Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NYSE Amex LLC To Adopt a Policy Relating to Its Treatment of Trade Reports That It Determines To Be Inconsistent With the Prevailing Market, 18597-18600 [E9-9240]
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Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Notices
Fact-Sheet-on-PresidentialMemorandum-on-Scientific-Integrity/.
FOR FURTHER INFORMATION CONTACT: For
information regarding this Notice,
please contact
scientificintegrity@ostp.eop.gov.
In his
March 9, 2009 memorandum on
Scientific Integrity, the President states
that ‘‘science and the scientific process
must inform and guide decisions of my
Administration on a wide range of
issues’’ and assigns the Director of the
Office of Science and Technology Policy
(the Director) responsibility for ensuring
scientific integrity throughout the
executive branch. To this end, the
memorandum requires the Director to
submit within 120 days a set of
recommendations for Presidential action
to ensure scientific integrity. If possible,
for each comment you submit, please
note to which of the six principles
below your comment relates. This will
assist in properly categorizing the
public comments and responding to the
President’s memorandum on Scientific
Integrity. The six principles from the
memorandum are as follows:
(a) The selection and retention of
candidates for science and technology
positions in the executive branch
should be based on the candidate’s
knowledge, credentials, experience, and
integrity;
(b) Each agency should have
appropriate rules and procedures to
ensure the integrity of the scientific
process within the agency;
(c) When scientific or technological
information is considered in policy
decisions, the information should be
subject to well-established scientific
processes, including peer review where
appropriate, and each agency should
appropriately and accurately reflect that
information in complying with and
applying relevant statutory standards.
(d) Except for information that is
properly restricted from disclosure
under procedures established in
accordance with statute, regulation,
Executive Order, or Presidential
Memorandum, each agency should
make available to the public the
scientific or technological findings or
conclusions considered or relied on in
policy decisions;
(e) Each agency should have in place
procedures to identify and address
instances in which the scientific process
or the integrity of scientific and
technological information may be
compromised; and
(f) Each agency should adopt such
additional procedures, including any
appropriate whistleblower protections,
as are necessary to ensure the integrity
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SUPPLEMENTARY INFORMATION:
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of scientific and technological
information and processes on which the
agency relies in its decision-making or
otherwise uses or prepares.
Comments from the public will help
the OSTP determine what should be
included in these recommendations.
Respondents are invited to suggest: (1)
Recommendations that would be
responsive to the aims of the President,
(2) specific implementing strategies, and
(3) data and empirical evidence related
to the effectiveness of strategies to
promote scientific integrity. Comments
submitted are encouraged to:
• Be as succinct as possible (1000
words or less recommended);
• Specify which of the prior six
principles (a–f) are being addressed
with each comment;
• Explain views and reasoning
clearly; and
• Describe how the success of
particular strategies might be evaluated
or measured.
M. David Hodge,
Operations Manager, OSTP.
[FR Doc. E9–9307 Filed 4–22–09; 8:45 am]
BILLING CODE 3170–W9–P
SECURITIES AND EXCHANGE
COMMISSION
[File No. 500–1]
Act Manufacturing, Inc., Aerovox, Inc.
(n/k/a New Bedford Capacitor, Inc.),
Agility Capital, Inc., Air Water
International Corp. (f/k/a Universal
Communications Systems, Inc.),
Allegiant Physician Services, Inc., and
Alpha Microsystems, Inc. (n/k/a NQL,
Inc.); Order of Suspension of Trading
April 21, 2009.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Act
Manufacturing, Inc. because it has not
filed any periodic reports since the
period ended September 30, 2001.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Aerovox,
Inc. (n/k/a New Bedford Capacitor, Inc.)
because it has not filed any periodic
reports since the period ended March
31, 2001.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Agility
Capital, Inc. because it has not filed any
periodic reports since the period ended
June 30, 2002.
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18597
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Air Water
International Corp. (f/k/a Universal
Communications Systems, Inc.) because
it has not filed any periodic reports
since the period ended June 30, 2006.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Allegiant
Physician Services, Inc. because it has
not filed any periodic reports since the
period ended June 30, 1996.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Alpha
Microsystems, Inc. (n/k/a NQL, Inc.)
because it has not filed any periodic
reports since the period ended
September 30, 2001.
The Commission is of the opinion that
the public interest and the protection of
investors require a suspension of trading
in the securities of the above-listed
companies.
Therefore, it is ordered, pursuant to
Section 12(k) of the Securities Exchange
Act of 1934, that trading in the
securities of the above-listed companies
is suspended for the period from 9:30
a.m. EDT on April 21, 2009, through
11:59 p.m. EDT on May 4, 2009.
By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. E9–9418 Filed 4–21–09; 4:15 pm]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59778; File No. SR–
NYSEAmex–2009–12]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NYSE
Amex LLC To Adopt a Policy Relating
to Its Treatment of Trade Reports That
It Determines To Be Inconsistent With
the Prevailing Market
April 16, 2009.
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 6,
2009, NYSE Amex LLC (‘‘NYSE Amex’’
or ‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Notices
below, which Items have been prepared
by the Exchange. The Exchange has
designated this proposal as eligible for
immediate effectiveness pursuant to
Securities Exchange Act Rule 19b–
4(f)(6).3 The Commission is publishing
this notice to solicit comments on the
proposal from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to adopt a
policy relating to its treatment of trade
reports that it determines to be
inconsistent with the prevailing market.
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.
sroberts on PROD1PC70 with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Trades in listed securities
occasionally occur at prices that deviate
significantly from prevailing market
prices and those trades sometimes
establish a high, low or last sale price
for a security that does not reflect the
true market for the security.
The Consolidated Tape Association
(‘‘CTA’’) offers each Participant in the
CTA Plan the discretion to append an
indicator (an ‘‘Aberrant Report
Indicator’’) to a trade report to indicate
that the market believes that the trade
price in a trade executed on that market
does not accurately reflect the
prevailing market for the security. The
CTA recommends that data recipients
should exclude the price of any trade to
which the Aberrant Report Indicator has
been appended from any calculation of
the high, low and last sale prices for the
security.
During the course of surveillance by
the Exchange or as a result of
notification by another market, listed
company or market participant, the
Exchange may become aware of trade
prices that do not accurately reflect the
3 17
CFR 240.19b–4(f)(6).
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prevailing market for a security. In such
a case, the Exchange proposes to adopt
as policies that it:
• May determine to append an
Aberrant Report Indicator to any trade
report with respect to any trade
executed on the Exchange that the
Exchange determines to be inconsistent
with the prevailing market; and
• Shall discourage vendors and other
data recipients from using prices to
which the Exchange has appended the
Aberrant Report Indicator in any
calculation of the high, low or last sale
price of a security.
The Exchange will urge vendors to
disclose the exclusion from high, low or
last sale price data of any aberrant
trades excluded from high, low or last
sale price information they disseminate
and to provide to data users an
explanation of the parameters used in
the Exchange’s aberrant trade policy.
Upon initial adoption of the Aberrant
Report Indicator, the Exchange will also
contact all of its listed companies to
explain the aberrant trade policy and
will notify users of the information that
these are still valid trades. The
Exchange will inform the affected listed
company each time the Exchange or
another market appends the Aberrant
Report Indicator to a trade in an NYSE
Amex listed stock and will remind the
users of the information that these are
still valid trades in that they were
executed and not unwound as in the
case of a clearly erroneous trade.
While the CTA disseminates its own
calculations of high, low and last sale
prices, vendors and other data
recipients—and not the Exchange—
frequently determine their own
methodology by which they wish to
calculate high, low and last sale prices.
Therefore, the Exchange shall endeavor
to explain to those vendors and other
data recipients the deleterious effects
that can result from including in the
calculations a trade to which the
Aberrant Report Indicator has been
appended.
In making the determination to
append the Aberrant Report Indicator,
the Exchange shall consider all factors
related to a trade, including, but not
limited to, the following:
• Material news released for the
security;
• Suspicious trading activity;
• System malfunctions or
disruptions;
• Locked or crossed markets;
• A recent trading halt or resumption
of trading in the security;
• Whether the security is in its initial
public offering;
• Volume and volatility for the
security;
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• Whether the trade price represents
a 52-week high or low for the security;
• Whether the trade price deviates
significantly from recent trading
patterns in the security;
• Whether the trade price reflects a
stock-split, reorganization or other
corporate action;
• The validity of consolidated tape
trades and quotes in comparison to
national best bids and offers; and
• The general volatility of market
conditions.
In addition, the Exchange proposes
that its policy shall be to consult with
other markets (in the case of executions
that take place across multiple markets)
and to seek a consensus as to whether
the trade price is consistent with the
prevailing market for the security.
In determining whether trade prices
are inconsistent with the prevailing
market, the Exchange proposes that
Exchange policy shall be to follow the
following general guidelines: The
Exchange will determine whether a
trade price does not reflect the
prevailing market for a security if the
trade occurs during regular trading
hours (i.e., 9:30 a.m. to 4 p.m.) and
occurs at a price that deviates from the
‘‘Reference Price’’ by an amount that
meets or exceeds the following
thresholds:
Trade price
Numerical
threshold
Between $0 and $15.00 ......
Between $15.01 and $50.00
In excess of $50.00 .............
Seven percent.
Five percent.
Three percent.
The ‘‘Reference Price’’ refers to (a) if
the primary market for the security is
open at the time of the trade, the
national best bid or offer for the
security, or (b) if the primary market for
the security is not open at the time of
the trade, the first executable quote or
print for the security on the primary
market after execution of the trade in
question. However, if the circumstances
suggest that a different Reference Price
would be more appropriate, the
Exchange will use the different
Reference Price. For instance, if the
national best bid and offer for the
security are so wide apart as to fail to
reflect the market for the security, the
Exchange might use as the Reference
Price a trade price or best bid or offer
that was available prior to the trade in
question.
If the Exchange determines that a
trade price does not reflect the
prevailing market for a security and the
trade represented the last sale of the
security on the Exchange during a
trading session, the Exchange may also
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Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Notices
determine to remove that trade’s
designation as the last sale. The
Exchange may do so either on the day
of the trade or at a later date, so as to
provide reasonable time for the
Exchange to conduct due diligence
regarding the trade, including the
consideration of input from markets and
other market participants.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the objectives of Section 6 4 of the Act
in general and furthers the objectives of
Section 6(b)(5) 5 in particular, in that it
is designed to promote just and
equitable principles of trade, to remove
impediments, and to 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
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.
4 15
U.S.C. 78f.
U.S.C. 78f(b)(5).
6 The Commission notes that, in the filing’s
purpose section, the Exchange provided a more
complete statutory basis for the proposed rule
change, as follows:
The Exchange believes that the proposed rule
change is consistent with Section 6(b) of the
Securities Exchange Act of 1934 (the ‘‘Act’’), in
general, and furthers the objectives of Section
6(b)(5) of the Act, in particular in that it is designed
to promote just and equitable principles of trade, to
foster cooperation and coordination with persons
engaged in regulating, clearing, settling, processing
information with respect to, and facilitating
transactions in securities, 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.
In particular, the Aberrant Report Indicator is
consistent with the protection of investors and the
public interest in that the Exchange will seek to
ensure a proper understanding of the Aberrant
Report Indicator among securities market
participants by: (i) Urging vendors to disclose the
exclusion from high, low or last sale price data of
any aberrant trades excluded from high, low or last
sale price information they disseminate and to
provide to data users an explanation of the
parameters used in the Exchange’s aberrant trade
policy; (ii) informing the affected listed company
each time the Exchange or another market appends
the Aberrant Report Indicator to a trade in an NYSE
Amex listed stock; and (iii) reminding the users of
the information that these are still valid trades in
that they were executed and not unwound as in the
case of a clearly erroneous trade.
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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
Pursuant to Section 19(b)(3)(A) of the
Act 7 and Rule 19b–4(f)(6) thereunder,8
the Exchange has designated this
proposal as one that effects a change
that: (A) does not significantly affect the
protection of investors or the public
interest; (B) does not impose any
significant burden on competition; and
(C) by its terms, does not 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.
A proposed rule change filed under
19b–4(f)(6) normally may not become
operative for 30 days after the date of
filing.9 However, Rule 19b–4(f)(6)(iii) 10
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 and
designate the proposed rule change to
become operative upon filing.
The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest
because the proposal is substantially
similar to a proposal previously
approved by the Commission.11 The
Commission believes that the
Exchange’s proposal to append an
Aberrant Report Indicator to certain
trade reports is a reasonable means to
alert investors and others that the
Exchange believes that the trade price
for a trade executed in its market does
not accurately reflect the prevailing
market for the security. In addition, the
Commission notes that the Exchange
7 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
9 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule
19b–4(f)(6)(iii) requires a self-regulatory
organization to give the Commission written notice
of its intent to file 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. The Exchange has
satisfied this requirement.
10 Id.
11 See Securities Exchange Act Release No. 58736
(October 6, 2008), 73 FR 60380 (October 10, 2008)
(SR–NYSE–2008–91). See also Securities Exchange
Act Release No. 59151 (December 23, 2008), 74 FR
158 (January 2, 2009) (SR–NASDAQ–2008–100).
8 17
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18599
will use objective numerical thresholds
in determining whether a trade report is
eligible to have an Aberrant Trade
Indicator appended to it. The
Commission further notes that the
Exchange’s appending the Aberrant
Trade Indicator to a trade report has no
effect on the validity of the underlying
trade. Finally, waiving the 30-day
operative delay will allow the Exchange
to apply the proposed change to
aberrant trades immediately.12 Based on
the above, the Commission designates
the proposal to become 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 the 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 rulecomments@sec.gov. Please include File
Number SR–NYSEAmex–2009–12 on
the subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–NYSEAmex–2009–12. 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
12 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
impact of the proposed rule on efficiency,
competition, and capital formation. 15 U.S.C. 78c(f).
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Federal Register / Vol. 74, No. 77 / Thursday, April 23, 2009 / Notices
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 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 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–
NYSEAmex–2009–12 and should be
submitted on or before May 14, 2009.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–9240 Filed 4–22–09; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59779; File No. SR–Phlx–
2009–32]
Self-Regulatory Organizations;
NASDAQ OMX PHLX, Inc.; Notice of
Filing of Amendment No. 1 to
Proposed Rule Change Relating to the
Exchange’s Enhanced Electronic
Trading Platform for Options, Phlx XL
II
April 16, 2009.
sroberts on PROD1PC70 with NOTICES
On April 3, 2009, NASDAQ OMX
PHLX, Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to implement several
enhancements to its electronic options
trading system, Phlx XL. The proposed
rule change was published for comment
in the Federal Register on April 14,
2009.3 Pursuant to Section 19(b)(1) of
the Act,4 and Rule 19b–4 thereunder,5
notice is hereby given that on April 15,
2009, Phlx filed with the Commission
13 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 59721
(April 7, 2009), 74 FR 17245 (April 14, 2009).
4 15 U.S.C. 78s(b)(1).
5 17 CFR 240.19b–4.
1 15
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16:59 Apr 22, 2009
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Amendment No. 1 to the proposed rule
change as described in Item I below.
The Commission is publishing this
notice of Amendment No. 1 to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
Amendment No. 1 to the Proposed Rule
Change
The Exchange is filing Amendment
No. 1 to clarify and correct discrete
portions of File No. SR–Phlx–2009–32,
which proposes to implement several
enhancements to its electronic options
trading system, Phlx XL, with the
enhanced system to be named Phlx XL
II. The text of the proposed rule change
is available on the Exchange’s Web site
at https://
nasdaqomxphlx.cchwallstreet.com/
NASDAQOMXPHLX/Filings/, at the
principal office of the Exchange, and at
the Commission’s Public Reference
Room.
Changes to the ‘‘Purpose’’ Section of the
Previously Submitted Form 19b–4
References to ‘‘page numbers’’ mean
the page numbers in the previously
submitted Form 19b–4 for SR–Phlx–
2009–32. In addition to the proposed
changes below, the Exchange proposes
conforming changes to the previously
submitted Exhibit 1 to SR–Phlx–2009–
32.
1. Delete from footnote 3 the Federal
Register citation to ‘‘44612’’ and replace
it with ‘‘46612.’’
2. Add a closing parenthesis to
footnote 6 after the phrase, ‘‘the
‘‘Linkage Plan,’’.’’
3. Delete the following phrase from
the third sentence of the first full
paragraph on page 12:
‘‘a number of contracts with a size
equal to the size of the interest at other
markets at prices better than interest on
the Exchange,’’
Replace the deleted phrase with the
following:
‘‘all marketable contracts on the
Exchange to such better priced away
markets,’’
4. Delete the following phrase from
the first sentence of the first full
paragraph on page 15:
‘‘conduct a Provisional Opening’’
Replace the deleted phrase with the
following:
‘‘open as many contracts as possible’’
5. Delete the final sentence of the first
full paragraph on page 15 which states:
‘‘The Exchange opening price will
always be equal to or better than the
OQR.’’
6. Delete the following sentence from
footnote 39:
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‘‘The duration of the brief period will
be published in an Options Trader
Alert, which will be available on the
Exchange’s web site.’’
This is consistent with footnote 65.
The brief period is not on a timer.
7. Add the following at the end of
footnote 44 on page 20:
‘‘All references to a ‘‘Quote Exhaust
Timer’’ in the Phlx XL II system and in
the proposed rules mean a system pause
for a brief period. Phlx XL II
participants will not receive any
notification that a Quote Exhaust Timer
has been initiated.’’
8. In the seventh line of the second
paragraph on page 24, delete ‘‘B’’ in
parentheses and replace it with ‘‘E’’ in
parentheses and delete the ‘‘C’’ in
parentheses and replace it with ‘‘F’’ in
parentheses.
9. Delete the following sentences from
Page 30 under Example II ‘‘After the
Quote Exhaust Timer’’:
‘‘The initiating order buys 20
contracts from Market Maker 1 at 2.70
and the Phlx XL II system will
contemporaneously route the
unexecuted balance of the initiating
order to the away market, 10 to buy at
2.70. This should result in a buy of 10
contracts at 2.65 on the away market.
The disseminated PBBO is 2.20 bid,
2.70 offer, with a size of 20x5’’
Replace the deleted sentences with
the following:
‘‘The initiating order has 30
unexecuted contracts to buy. The Phlx
XL II system will route 10 contracts to
buy at 2.65 to the ABBO market, which
is the best available price and size. The
remaining balance is posted in the
PBBO at the ABBO price.
The disseminated PBBO is 2.65 bid,
2.70 offer, with a size of 20x25.’’
10. Delete the following phrase from
the second sentence of the last
paragraph on page 34 (and continuing to
page 35):
‘‘a number of contracts that will
satisfy interest at’’
Replace the deleted phrase with the
following:
‘‘all marketable contracts on the
Exchange to’’
11. Delete the following phrase from
the second sentence of the first full
paragraph on page 35:
‘‘a number of contracts that will
satisfy interest at other markets at prices
better than’’
Replace the deleted phrase with the
following:
‘‘any remaining contracts to away
markets at’’
12. Delete the word ‘‘or’’ from the
third line of the first full paragraph on
page 38, and replace it with the phrase
‘‘if the Exchange Auction Price is no
more than’’
E:\FR\FM\23APN1.SGM
23APN1
]]>Agencies
[Federal Register Volume 74, Number 77 (Thursday, April 23, 2009)]
[Notices]
[Pages 18597-18600]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-9240]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-59778; File No. SR-NYSEAmex-2009-12]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Amex LLC To Adopt a
Policy Relating to Its Treatment of Trade Reports That It Determines To
Be Inconsistent With the Prevailing Market
April 16, 2009.
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 6, 2009, NYSE Amex LLC (``NYSE Amex'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II
[[Page 18598]]
below, which Items have been prepared by the Exchange. The Exchange has
designated this proposal as eligible for immediate effectiveness
pursuant to Securities Exchange Act Rule 19b-4(f)(6).\3\ The Commission
is publishing this notice to solicit comments on the proposal from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 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 proposes to adopt a policy relating to its treatment
of trade reports that it determines to be inconsistent with the
prevailing market.
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
Trades in listed securities occasionally occur at prices that
deviate significantly from prevailing market prices and those trades
sometimes establish a high, low or last sale price for a security that
does not reflect the true market for the security.
The Consolidated Tape Association (``CTA'') offers each Participant
in the CTA Plan the discretion to append an indicator (an ``Aberrant
Report Indicator'') to a trade report to indicate that the market
believes that the trade price in a trade executed on that market does
not accurately reflect the prevailing market for the security. The CTA
recommends that data recipients should exclude the price of any trade
to which the Aberrant Report Indicator has been appended from any
calculation of the high, low and last sale prices for the security.
During the course of surveillance by the Exchange or as a result of
notification by another market, listed company or market participant,
the Exchange may become aware of trade prices that do not accurately
reflect the prevailing market for a security. In such a case, the
Exchange proposes to adopt as policies that it:
May determine to append an Aberrant Report Indicator to
any trade report with respect to any trade executed on the Exchange
that the Exchange determines to be inconsistent with the prevailing
market; and
Shall discourage vendors and other data recipients from
using prices to which the Exchange has appended the Aberrant Report
Indicator in any calculation of the high, low or last sale price of a
security.
The Exchange will urge vendors to disclose the exclusion from high,
low or last sale price data of any aberrant trades excluded from high,
low or last sale price information they disseminate and to provide to
data users an explanation of the parameters used in the Exchange's
aberrant trade policy. Upon initial adoption of the Aberrant Report
Indicator, the Exchange will also contact all of its listed companies
to explain the aberrant trade policy and will notify users of the
information that these are still valid trades. The Exchange will inform
the affected listed company each time the Exchange or another market
appends the Aberrant Report Indicator to a trade in an NYSE Amex listed
stock and will remind the users of the information that these are still
valid trades in that they were executed and not unwound as in the case
of a clearly erroneous trade.
While the CTA disseminates its own calculations of high, low and
last sale prices, vendors and other data recipients--and not the
Exchange--frequently determine their own methodology by which they wish
to calculate high, low and last sale prices. Therefore, the Exchange
shall endeavor to explain to those vendors and other data recipients
the deleterious effects that can result from including in the
calculations a trade to which the Aberrant Report Indicator has been
appended.
In making the determination to append the Aberrant Report
Indicator, the Exchange shall consider all factors related to a trade,
including, but not limited to, the following:
Material news released for the security;
Suspicious trading activity;
System malfunctions or disruptions;
Locked or crossed markets;
A recent trading halt or resumption of trading in the
security;
Whether the security is in its initial public offering;
Volume and volatility for the security;
Whether the trade price represents a 52-week high or low
for the security;
Whether the trade price deviates significantly from recent
trading patterns in the security;
Whether the trade price reflects a stock-split,
reorganization or other corporate action;
The validity of consolidated tape trades and quotes in
comparison to national best bids and offers; and
The general volatility of market conditions.
In addition, the Exchange proposes that its policy shall be to
consult with other markets (in the case of executions that take place
across multiple markets) and to seek a consensus as to whether the
trade price is consistent with the prevailing market for the security.
In determining whether trade prices are inconsistent with the
prevailing market, the Exchange proposes that Exchange policy shall be
to follow the following general guidelines: The Exchange will determine
whether a trade price does not reflect the prevailing market for a
security if the trade occurs during regular trading hours (i.e., 9:30
a.m. to 4 p.m.) and occurs at a price that deviates from the
``Reference Price'' by an amount that meets or exceeds the following
thresholds:
------------------------------------------------------------------------
Trade price Numerical threshold
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Between $0 and $15.00................... Seven percent.
Between $15.01 and $50.00............... Five percent.
In excess of $50.00..................... Three percent.
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The ``Reference Price'' refers to (a) if the primary market for the
security is open at the time of the trade, the national best bid or
offer for the security, or (b) if the primary market for the security
is not open at the time of the trade, the first executable quote or
print for the security on the primary market after execution of the
trade in question. However, if the circumstances suggest that a
different Reference Price would be more appropriate, the Exchange will
use the different Reference Price. For instance, if the national best
bid and offer for the security are so wide apart as to fail to reflect
the market for the security, the Exchange might use as the Reference
Price a trade price or best bid or offer that was available prior to
the trade in question.
If the Exchange determines that a trade price does not reflect the
prevailing market for a security and the trade represented the last
sale of the security on the Exchange during a trading session, the
Exchange may also
[[Page 18599]]
determine to remove that trade's designation as the last sale. The
Exchange may do so either on the day of the trade or at a later date,
so as to provide reasonable time for the Exchange to conduct due
diligence regarding the trade, including the consideration of input
from markets and other market participants.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 \4\ of the Act in general and furthers
the objectives of Section 6(b)(5) \5\ in particular, in that it is
designed to promote just and equitable principles of trade, to remove
impediments, and to 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\
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\4\ 15 U.S.C. 78f.
\5\ 15 U.S.C. 78f(b)(5).
\6\ The Commission notes that, in the filing's purpose section,
the Exchange provided a more complete statutory basis for the
proposed rule change, as follows:
The Exchange believes that the proposed rule change is
consistent with Section 6(b) of the Securities Exchange Act of 1934
(the ``Act''), in general, and furthers the objectives of Section
6(b)(5) of the Act, in particular in that it is designed to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating
transactions in securities, 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.
In particular, the Aberrant Report Indicator is consistent with
the protection of investors and the public interest in that the
Exchange will seek to ensure a proper understanding of the Aberrant
Report Indicator among securities market participants by: (i) Urging
vendors to disclose the exclusion from high, low or last sale price
data of any aberrant trades excluded from high, low or last sale
price information they disseminate and to provide to data users an
explanation of the parameters used in the Exchange's aberrant trade
policy; (ii) informing the affected listed company each time the
Exchange or another market appends the Aberrant Report Indicator to
a trade in an NYSE Amex listed stock; and (iii) reminding the users
of the information that these are still valid trades in that they
were executed and not unwound as in the case of a clearly erroneous
trade.
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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
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
Pursuant to Section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)
thereunder,\8\ the Exchange has designated this proposal as one that
effects a change that: (A) does not significantly affect the protection
of investors or the public interest; (B) does not impose any
significant burden on competition; and (C) by its terms, does not
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.
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under 19b-4(f)(6) normally may not
become operative for 30 days after the date of filing.\9\ However, Rule
19b-4(f)(6)(iii) \10\ 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 and designate the proposed rule change
to become operative upon filing.
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\9\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires a self-regulatory organization to give the
Commission written notice of its intent to file 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. The Exchange has satisfied this requirement.
\10\ Id.
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The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because the proposal is substantially similar to a proposal previously
approved by the Commission.\11\ The Commission believes that the
Exchange's proposal to append an Aberrant Report Indicator to certain
trade reports is a reasonable means to alert investors and others that
the Exchange believes that the trade price for a trade executed in its
market does not accurately reflect the prevailing market for the
security. In addition, the Commission notes that the Exchange will use
objective numerical thresholds in determining whether a trade report is
eligible to have an Aberrant Trade Indicator appended to it. The
Commission further notes that the Exchange's appending the Aberrant
Trade Indicator to a trade report has no effect on the validity of the
underlying trade. Finally, waiving the 30-day operative delay will
allow the Exchange to apply the proposed change to aberrant trades
immediately.\12\ Based on the above, the Commission designates the
proposal to become operative upon filing.
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\11\ See Securities Exchange Act Release No. 58736 (October 6,
2008), 73 FR 60380 (October 10, 2008) (SR-NYSE-2008-91). See also
Securities Exchange Act Release No. 59151 (December 23, 2008), 74 FR
158 (January 2, 2009) (SR-NASDAQ-2008-100).
\12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the impact of the proposed rule on
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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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 the 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-NYSEAmex-2009-12 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEAmex-2009-12. 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
[[Page 18600]]
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 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 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-NYSEAmex-2009-12 and should
be submitted on or before May 14, 2009.
For the Commission, by the Division of Trading and Markets,
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. E9-9240 Filed 4-22-09; 8:45 am]
BILLING CODE 8010-01-P
