Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NYSE Amex LLC Proposing To Extend the Operation of Its New Market Model Pilot Currently Scheduled To Expire on March 30, 2010, Until the Earlier of Securities and Exchange Commission Approval To Make Such Pilot Permanent or September 30, 2010, 14223-14225 [2010-6376]

Download as PDF Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Notices of the Act and Rule 19b–4(f)(6)(iii) thereunder.17 A proposed rule change filed under Rule 19b–4(f)(6) 18 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b-4(f)(6)(iii),19 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest. The Commission notes that because the pilot program will expire on March 30, 2010, waiver of the operative delay is necessary so that no interruption of the pilot program will occur. In addition, the Commission notes that the Exchange has requested extension of the pilot to allow the Exchange time to formally request permanent approval. Therefore, the Commission designates the proposal operative upon filing.20 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: srobinson on DSKHWCL6B1PROD 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 17 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) requires the self-regulatory organization to submit to the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. 18 17 CFR 240.19b–4(f)(6). 19 17 CFR 240.19b–4(f)(6)(iii). 20 For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). VerDate Nov<24>2008 16:24 Mar 23, 2010 Jkt 220001 Number SR–NYSE–2010–25 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. 14223 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–61725; File No. SR– NYSEAmex–2010–28] Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NYSE Amex LLC Proposing To Extend the Operation of Its New Market Model All submissions should refer to File Pilot Currently Scheduled To Expire on Number SR–NYSE–2010–25. This file March 30, 2010, Until the Earlier of number should be included on the subject line if e-mail is used. To help the Securities and Exchange Commission Approval To Make Such Pilot Commission process and review your Permanent or September 30, 2010 comments more efficiently, please use only one method. The Commission will March 17, 2010. post all comments on the Commission’s Pursuant to Section 19(b)(1) 1 of the Internet Web site (https://www.sec.gov/ Securities Exchange Act of 1934 (the rules/sro.shtml). Copies of the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 submission, all subsequent notice is hereby given that on March 15, amendments, all written statements 2010, NYSE Amex LLC (the ‘‘Exchange’’ or ‘‘NYSE Amex’’) filed with the with respect to the proposed rule Securities and Exchange Commission change that are filed with the (the ‘‘Commission’’) the proposed rule Commission, and all written change as described in Items I and II communications relating to the below, which Items have been prepared proposed rule change between the Commission and any person, other than by the self-regulatory organization. The Commission is publishing this notice to those that may be withheld from the solicit comments on the proposed rule public in accordance with the change from interested persons. provisions of 5 U.S.C. 552, will be available for Web site viewing and I. Self-Regulatory Organization’s printing in the Commission’s Public Statement of the Terms of Substance of Reference Section on official business the Proposed Rule Change days between the hours of 10 a.m. and NYSE Amex LLC (the ‘‘Exchange’’ or 3 p.m. Copies of such filing also will be ‘‘NYSE Amex’’) proposes to extend the available for inspection and copying at operation of its New Market Model Pilot the principal office of the Exchange. All currently scheduled to expire on March comments received will be posted 30, 2010, until the earlier of Securities without change; the Commission does and Exchange Commission approval to not edit personal identifying make such pilot permanent or information from submissions. You September 30, 2010. The text of the should submit only information that proposed rule change is available at the you wish to make available publicly. All Exchange, the Commission’s Public submissions should refer to File Reference Room, and https:// Number SR–NYSE–2010–25 and should www.nyse.com. be submitted on or before April 14, II. Self-Regulatory Organization’s 2010. Statement of the Purpose of, and For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.21 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–6377 Filed 3–23–10; 8:45 am] BILLING CODE 8011–01–P 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. 1 15 U.S.C.78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 2 15 21 17 PO 00000 CFR 200.30–3(a)(12). Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\24MRN1.SGM 24MRN1 14224 Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Notices A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to extend the operation of its New Market Model Pilot (‘‘NMM Pilot’’) that was adopted pursuant to its merger with the New York Stock Exchange LLC.4 The NMM Pilot was approved by the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) to operate until October 1, 2009. The Exchange filed to extend the operation of the Pilot to November 30, 2009 5 and then to March 30, 2010.6 The Exchange now seeks to extend the operation of the NMM Pilot from March 30, 2010, until the earlier of Securities and Exchange Commission approval to make such pilot permanent or September 30, 2010. The Exchange notes that parallel changes are proposed to be made to the rules of New York Stock Exchange LLC.7 srobinson on DSKHWCL6B1PROD with NOTICES Background 8 In December 2008, NYSE Amex implemented significant changes to its market rules, execution technology and the rights and obligations of its market participants all of which were designed to improve execution quality on the Exchange. These changes are all elements of the Exchange’s enhanced market model that it implemented through the NMM Pilot. As part of the NMM Pilot, NYSE Amex eliminated the function of specialists on the Exchange creating a 4 NYSE Euronext acquired The Amex Membership Corporation (‘‘AMC’’) pursuant to an Agreement and Plan of Merger, dated January 17, 2008 (the ‘‘Merger’’). In connection with the Merger, the Exchange’s predecessor, the American Stock Exchange LLC (‘‘Amex’’), a subsidiary of AMC, became a subsidiary of NYSE Euronext called NYSE Alternext US LLC. Securities Exchange Act Release No. 58673 (September 29, 2008), 73 FR 57707 (October 3, 2008) (SR–NYSE–2008–60 and SR– Amex–2008–62) (approving the Merger). Subsequently NYSE Alternext US LLC was renamed NYSE Amex LLC and continues to operate as a national securities exchange registered under Section 6 of the Securities Exchange Act of 1934, as amended (the ‘‘Act’’). NYSE Alternext US LLC was subsequently renamed NYSE Amex LLC. See Securities Exchange Act Release No. 59575 (March 13, 2009), 74 FR 11803 (March 19, 2009) (SR– NYSEALTR–2009–24). 5 See Securities Exchange Act Release No. 60758 (October 1, 2009), 74 FR (October 7, 2009) (SR– NYSEAmex–2009–65). 6 See Securities Exchange Act Release No. 61030 (November 19, 2009), 74 FR 62365 (November 27, 2009) (SR–NYSEAmex–2009–83). 7 See SR–NYSE–2010–25. 8 The information contained herein is a summary of the NMM Pilot. For a fuller description of the pilot see Securities Exchange Act Release No. 58845 (October 24, 2008), 73 FR 64379 (October 29, 2008) (SR–NYSE–2008–46). VerDate Nov<24>2008 16:24 Mar 23, 2010 Jkt 220001 new category of market participant, the Designated Market Maker or DMM.9 The DMMs, like specialists, have affirmative obligations to make an orderly market, including continuous quoting requirements and obligations to re-enter the market when reaching across to execute against trading interest. Unlike specialists, DMMs have a minimum quoting requirement 10 in their assigned securities and no longer have a negative obligation. DMMs are also no longer agents for public customer orders.11 In addition, the Exchange implemented a system change that allowed DMMs to create a schedule of additional non-displayed liquidity at various price points where the DMM is willing to interact with interest and provide price improvement to orders in the Exchange’s system. This schedule is known as the DMM Capital Commitment Schedule (‘‘CCS’’).12 CCS provides the Display Book® 13 with the amount of shares that the DMM is willing to trade at price points outside, at and inside the Exchange BBO. CCS interest is separate and distinct from other DMM interest in that it serves as the interest of last resort. The NMM Pilot further modified the logic for allocating executed shares among market participants having trading interest at a price point upon execution of incoming orders. The modified logic rewards displayed orders that establish the Exchange’s best bid or Exchange’s best offer. During the operation of the NMM Pilot orders or portions thereof that establish priority 14 retain that priority until the portion of the order that established priority is exhausted. Where no one order has established priority, shares are distributed among all market participants on parity. The NMM Pilot was originally scheduled to end operation on October 1, 2009, or such earlier time as the Commission may determine to make the rules permanent. The Exchange filed to extend the operation of the Pilot on two 9 See NYSE Amex Equities Rule 103. NYSE Amex Equities Rule, 104. 11 See NYSE Amex Equities Rule 60; See also 104 and 1000. 12 See NYSE Amex Equities Rule 1000. 13 The Display Book® system is an order management and execution facility. The Display Book system receives and displays orders to the DMMs, contains the order information, and provides a mechanism to execute and report transactions and publish the results to the Consolidated Tape. The Display Book system is connected to a number of other Exchange systems for the purposes of comparison, surveillance, and reporting information to customers and other market data and national market systems. 14 See NYSE Amex Equities Rule 72(a)(ii). 10 See PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 occasions 15 in order to prepare a rule filing seeking permission to make the above described changes permanent. The Exchange is currently still preparing such formal submission but does not expect that filing to be completed and approved by the Commission before March 30, 2010. Proposal To Extend the Operation of the NMM Pilot NYSE Amex established the NMM Pilot to provide incentives for quoting, to enhance competition among the existing group of liquidity providers and add a new competitive market participant. The Exchange believes that the NMM Pilot allows the Exchange to provide its market participants with a trading venue that utilizes an enhanced market structure to encourage the addition of liquidity, facilitate the trading of larger orders more efficiently and operates to reward aggressive liquidity providers. As such, the Exchange believes that rules governing the NMM Pilot should be made permanent. Through this filing the Exchange seeks to extend the current operation of the NMM Pilot until September 30, 2010, in order to allow the Exchange time to formally submit a filing to the Commission to convert the pilot rules to permanent rules. 2. Statutory Basis The basis under the Securities Exchange Act of 1934 (the ‘‘Act’’) for this proposed rule change is the requirement under Section 6(b)(5) that an exchange have rules that are designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, to protect investors and the public interest. The Exchange believes that the instant filing is consistent with these principles because the NMM Pilot provides its market participants with a trading venue that utilizes an enhanced market structure to encourage the addition of liquidity, facilitate the trading of larger orders more efficiently and operates to reward aggressive liquidity providers. Moreover, the instant filing requesting an extension of the NMM Pilot will permit adequate time for: (i) The Exchange to prepare and submit a filing to make the rules governing the NMM Pilot permanent rules; (ii) public notice and comment; 15 See Securities Exchange Act Release Nos. 60758 (October 1, 2009), 74 FR [sic] (October 7, 2009) (SR–NYSEAmex–2009–65) (extending Pilot to November 30, 2009); 61030 (November 19, 2009), 74 FR 62365 (November 27, 2009) (SR–NYSEAmex– 2009–83) (extending Pilot to March 30, 2010). E:\FR\FM\24MRN1.SGM 24MRN1 Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Notices and (iii) completion of the 19b–4 approval process. 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 The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 16 and Rule 19b–4(f)(6) thereunder.17 Because the proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; or (iii) become operative prior to 30 days from the date on which it was filed, 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 and Rule 19b–4(f)(6)(iii) thereunder.18 A proposed rule change filed under Rule 19b–4(f)(6) 19 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b–4(f)(6)(iii),20 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest. The 16 15 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(6). 18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) requires the self-regulatory organization to submit to the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. 19 17 CFR 240.19b–4(f)(6). 20 17 CFR 240.19b–4(f)(6)(iii). srobinson on DSKHWCL6B1PROD with NOTICES 17 17 VerDate Nov<24>2008 16:24 Mar 23, 2010 Jkt 220001 Commission notes that because the pilot program will expire on March 30, 2010, waiver of the operative delay is necessary so that no interruption of the pilot program will occur. In addition, the Commission notes that the Exchange has requested extension of the pilot to allow the Exchange time to formally request permanent approval. Therefore, the Commission designates the proposal operative upon filing.21 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 rulecomments@sec.gov. Please include File Number SR–NYSEAmex–2010–28 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–2010–28. 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 21 For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 14225 public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Section 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–2010–28 and should be submitted on or before April 14, 2010. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.22 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–6376 Filed 3–23–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–61737; File No. SR–ISE– 2010–22] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Permit Concurrent Listing of $3.50 and $4 Strikes for Classes in the $0.50 Strike and $1 Strike Programs March 18, 2010. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on March 10, 2010, the International Securities Exchange, LLC (the ‘‘Exchange’’ or the ‘‘ISE’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which items have been prepared by the Exchange. The Exchange has filed the proposal as a ‘‘non-controversial’’ proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 3 and Rule 19b–4(f)(6) thereunder.4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 22 17 CFR 200.30–3(a)(12). 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). 1 15 E:\FR\FM\24MRN1.SGM 24MRN1

Agencies

[Federal Register Volume 75, Number 56 (Wednesday, March 24, 2010)]
[Notices]
[Pages 14223-14225]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-6376]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61725; File No. SR-NYSEAmex-2010-28]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NYSE Amex LLC Proposing To 
Extend the Operation of Its New Market Model Pilot Currently Scheduled 
To Expire on March 30, 2010, Until the Earlier of Securities and 
Exchange Commission Approval To Make Such Pilot Permanent or September 
30, 2010

March 17, 2010.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on March 15, 2010, NYSE Amex LLC (the ``Exchange'' or ``NYSE 
Amex'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the self-regulatory 
organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    NYSE Amex LLC (the ``Exchange'' or ``NYSE Amex'') proposes to 
extend the operation of its New Market Model Pilot currently scheduled 
to expire on March 30, 2010, until the earlier of Securities and 
Exchange Commission approval to make such pilot permanent or September 
30, 2010. The text of the proposed rule change is available at the 
Exchange, the Commission's Public Reference Room, and https://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.

[[Page 14224]]

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to extend the operation of its New Market 
Model Pilot (``NMM Pilot'') that was adopted pursuant to its merger 
with the New York Stock Exchange LLC.\4\ The NMM Pilot was approved by 
the Securities and Exchange Commission (``SEC'' or ``Commission'') to 
operate until October 1, 2009. The Exchange filed to extend the 
operation of the Pilot to November 30, 2009 \5\ and then to March 30, 
2010.\6\ The Exchange now seeks to extend the operation of the NMM 
Pilot from March 30, 2010, until the earlier of Securities and Exchange 
Commission approval to make such pilot permanent or September 30, 2010.
---------------------------------------------------------------------------

    \4\ NYSE Euronext acquired The Amex Membership Corporation 
(``AMC'') pursuant to an Agreement and Plan of Merger, dated January 
17, 2008 (the ``Merger''). In connection with the Merger, the 
Exchange's predecessor, the American Stock Exchange LLC (``Amex''), 
a subsidiary of AMC, became a subsidiary of NYSE Euronext called 
NYSE Alternext US LLC. Securities Exchange Act Release No. 58673 
(September 29, 2008), 73 FR 57707 (October 3, 2008) (SR-NYSE-2008-60 
and SR-Amex-2008-62) (approving the Merger). Subsequently NYSE 
Alternext US LLC was renamed NYSE Amex LLC and continues to operate 
as a national securities exchange registered under Section 6 of the 
Securities Exchange Act of 1934, as amended (the ``Act''). NYSE 
Alternext US LLC was subsequently renamed NYSE Amex LLC. See 
Securities Exchange Act Release No. 59575 (March 13, 2009), 74 FR 
11803 (March 19, 2009) (SR-NYSEALTR-2009-24).
    \5\ See Securities Exchange Act Release No. 60758 (October 1, 
2009), 74 FR (October 7, 2009) (SR-NYSEAmex-2009-65).
    \6\ See Securities Exchange Act Release No. 61030 (November 19, 
2009), 74 FR 62365 (November 27, 2009) (SR-NYSEAmex-2009-83).
---------------------------------------------------------------------------

    The Exchange notes that parallel changes are proposed to be made to 
the rules of New York Stock Exchange LLC.\7\
---------------------------------------------------------------------------

    \7\ See SR-NYSE-2010-25.
---------------------------------------------------------------------------

Background \8\
---------------------------------------------------------------------------

    \8\ The information contained herein is a summary of the NMM 
Pilot. For a fuller description of the pilot see Securities Exchange 
Act Release No. 58845 (October 24, 2008), 73 FR 64379 (October 29, 
2008) (SR-NYSE-2008-46).
---------------------------------------------------------------------------

    In December 2008, NYSE Amex implemented significant changes to its 
market rules, execution technology and the rights and obligations of 
its market participants all of which were designed to improve execution 
quality on the Exchange. These changes are all elements of the 
Exchange's enhanced market model that it implemented through the NMM 
Pilot.
    As part of the NMM Pilot, NYSE Amex eliminated the function of 
specialists on the Exchange creating a new category of market 
participant, the Designated Market Maker or DMM.\9\ The DMMs, like 
specialists, have affirmative obligations to make an orderly market, 
including continuous quoting requirements and obligations to re-enter 
the market when reaching across to execute against trading interest. 
Unlike specialists, DMMs have a minimum quoting requirement \10\ in 
their assigned securities and no longer have a negative obligation. 
DMMs are also no longer agents for public customer orders.\11\
---------------------------------------------------------------------------

    \9\ See NYSE Amex Equities Rule 103.
    \10\ See NYSE Amex Equities Rule, 104.
    \11\ See NYSE Amex Equities Rule 60; See also 104 and 1000.
---------------------------------------------------------------------------

    In addition, the Exchange implemented a system change that allowed 
DMMs to create a schedule of additional non-displayed liquidity at 
various price points where the DMM is willing to interact with interest 
and provide price improvement to orders in the Exchange's system. This 
schedule is known as the DMM Capital Commitment Schedule (``CCS'').\12\ 
CCS provides the Display Book[supreg] \13\ with the amount of shares 
that the DMM is willing to trade at price points outside, at and inside 
the Exchange BBO. CCS interest is separate and distinct from other DMM 
interest in that it serves as the interest of last resort.
---------------------------------------------------------------------------

    \12\ See NYSE Amex Equities Rule 1000.
    \13\ The Display Book[supreg] system is an order management and 
execution facility. The Display Book system receives and displays 
orders to the DMMs, contains the order information, and provides a 
mechanism to execute and report transactions and publish the results 
to the Consolidated Tape. The Display Book system is connected to a 
number of other Exchange systems for the purposes of comparison, 
surveillance, and reporting information to customers and other 
market data and national market systems.
---------------------------------------------------------------------------

    The NMM Pilot further modified the logic for allocating executed 
shares among market participants having trading interest at a price 
point upon execution of incoming orders. The modified logic rewards 
displayed orders that establish the Exchange's best bid or Exchange's 
best offer. During the operation of the NMM Pilot orders or portions 
thereof that establish priority \14\ retain that priority until the 
portion of the order that established priority is exhausted. Where no 
one order has established priority, shares are distributed among all 
market participants on parity.
---------------------------------------------------------------------------

    \14\ See NYSE Amex Equities Rule 72(a)(ii).
---------------------------------------------------------------------------

    The NMM Pilot was originally scheduled to end operation on October 
1, 2009, or such earlier time as the Commission may determine to make 
the rules permanent. The Exchange filed to extend the operation of the 
Pilot on two occasions \15\ in order to prepare a rule filing seeking 
permission to make the above described changes permanent. The Exchange 
is currently still preparing such formal submission but does not expect 
that filing to be completed and approved by the Commission before March 
30, 2010.
---------------------------------------------------------------------------

    \15\ See Securities Exchange Act Release Nos. 60758 (October 1, 
2009), 74 FR [sic] (October 7, 2009) (SR-NYSEAmex-2009-65) 
(extending Pilot to November 30, 2009); 61030 (November 19, 2009), 
74 FR 62365 (November 27, 2009) (SR-NYSEAmex-2009-83) (extending 
Pilot to March 30, 2010).
---------------------------------------------------------------------------

Proposal To Extend the Operation of the NMM Pilot
    NYSE Amex established the NMM Pilot to provide incentives for 
quoting, to enhance competition among the existing group of liquidity 
providers and add a new competitive market participant. The Exchange 
believes that the NMM Pilot allows the Exchange to provide its market 
participants with a trading venue that utilizes an enhanced market 
structure to encourage the addition of liquidity, facilitate the 
trading of larger orders more efficiently and operates to reward 
aggressive liquidity providers. As such, the Exchange believes that 
rules governing the NMM Pilot should be made permanent. Through this 
filing the Exchange seeks to extend the current operation of the NMM 
Pilot until September 30, 2010, in order to allow the Exchange time to 
formally submit a filing to the Commission to convert the pilot rules 
to permanent rules.
2. Statutory Basis
    The basis under the Securities Exchange Act of 1934 (the ``Act'') 
for this proposed rule change is the requirement under Section 6(b)(5) 
that an exchange have rules that are designed to promote just and 
equitable principles of trade, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system and, 
in general, to protect investors and the public interest. The Exchange 
believes that the instant filing is consistent with these principles 
because the NMM Pilot provides its market participants with a trading 
venue that utilizes an enhanced market structure to encourage the 
addition of liquidity, facilitate the trading of larger orders more 
efficiently and operates to reward aggressive liquidity providers. 
Moreover, the instant filing requesting an extension of the NMM Pilot 
will permit adequate time for: (i) The Exchange to prepare and submit a 
filing to make the rules governing the NMM Pilot permanent rules; (ii) 
public notice and comment;

[[Page 14225]]

and (iii) completion of the 19b-4 approval process.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \16\ and Rule 19b-4(f)(6) thereunder.\17\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; or (iii) become operative prior to 
30 days from the date on which it was filed, 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 and Rule 19b-
4(f)(6)(iii) thereunder.\18\
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    \16\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \17\ 17 CFR 240.19b-4(f)(6).
    \18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the self-regulatory organization to submit to the 
Commission written notice of its intent to file the proposed rule 
change, along with a brief description and text of the proposed rule 
change, at least five business days prior to the date of filing of 
the proposed rule change, or such shorter time as designated by the 
Commission. The Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\20\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative immediately upon filing.
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    \19\ 17 CFR 240.19b-4(f)(6).
    \20\ 17 CFR 240.19b-4(f)(6)(iii).
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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. 
The Commission notes that because the pilot program will expire on 
March 30, 2010, waiver of the operative delay is necessary so that no 
interruption of the pilot program will occur. In addition, the 
Commission notes that the Exchange has requested extension of the pilot 
to allow the Exchange time to formally request permanent approval. 
Therefore, the Commission designates the proposal operative upon 
filing.\21\
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    \21\ For purposes only of waiving the operative delay for this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. See 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 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-2010-28 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-2010-28. 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 Web site 
viewing and printing in the Commission's Public Reference Section 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-2010-28 and should be submitted on or before 
April 14, 2010.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\22\
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    \22\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-6376 Filed 3-23-10; 8:45 am]
BILLING CODE 8011-01-P
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