[Federal Register Volume 75, Number 99 (Monday, May 24, 2010)]
[Notices]
[Pages 28842-28843]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-12423]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62130; File No. SR-CHX-2010-10]
Self-Regulatory Organizations; Proposed Rule Change by Chicago
Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change To
Establish a Trading Halt for Individual Stocks Contained in the
Standard & Poor's 500 Index
May 19, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\, and Rule 19b-4 \2\ thereunder, notice is hereby given
that on May 19, 2010, the Chicago Stock Exchange, Inc. (``CHX'' or the
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II
and III below, which Items have been prepared by the CHX. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
CHX proposes to amend Article 20, Rule 2 to amend its rules to
create circuit breakers regarding the trading of individual securities.
The text of this proposed rule change is available on the Exchange's
Web site at (http://www.chx.com) and in the Commission's Public
Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the CHX included statements
concerning the purpose of and basis for the proposed rule changes and
discussed any comments it received regarding the proposal. The text of
these statements
[[Page 28843]]
may be examined at the places specified in Item IV below. The CHX 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 Changes
1. Purpose
The CHX is proposing to amend Article 20, Rule 2 to allow the
Exchange to pause trading in an individual stock when the primary
listing market for such stock issues a trading pause. The primary
listing markets for U.S. stocks are in the process of amending their
rules so that they may, from time to time, issue a trading pause for an
individual security if the price of such security moves 10% or more
from a sale in a preceding five-minute period. The Exchange is
proposing this rule change in consultation with U.S. listing markets
and Commission staff to provide for uniform marketwide trading pause
standards for individual securities in the S&P 500[supreg] Index that
experience rapid price movement for a Pilot Period expiring on December
10, 2010. The Exchange is not currently the primary listing market for
any securities to be included in the Pilot, and thus, will not be
instituting any trading pauses on its own initiative at this time.\3\
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\3\ The Exchange anticipates discussion during the Pilot period
about the potential expansion of individual stock circuit breakers
to a broader group of securities. To the extent that it appears that
the Exchange may become the primary listing exchange for any
securities affected by an individual circuit breaker, it will adopt
the necessary rules to support that framework. See, e.g., proposed
NYSE Rule 80C.
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As proposed, the Exchange will pause trading in that stock until
trading has resumed on the primary listing market or notice has been
received from the primary listing market that trading may resume. If,
however, trading has not resumed on the primary listing market and ten
minutes have passed since the individual stock trading pause message
has been received from the responsible single plan processor, the
Exchange may resume trading in such stock.
The Exchange believes that the foregoing proposal is substantially
similar to the submissions of other U.S. equities exchanges concerning
circuit breaker provisions for individual securities and which are
under consideration by the Commission.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act in general,\4\ and furthers the objectives
of Section 6(b)(5) in particular,\5\ in that it is designed to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in facilitating transaction in
securities, to remove impediments and perfect the mechanisms of a free
and open market, and, in general, to protect investors and the public
interest. The proposed rule change is also designed to support the
principles of Section 11A(a)(1) \6\ of the Act in that it seeks to
assure fair competition among brokers and dealers and among exchange
markets. The Exchange believes that the proposed rule meets these
requirements in that it promotes transparency and uniformity across
markets concerning decisions to pause trading in a security when there
are significant price movements.
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\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(5).
\6\ 15 U.S.C. 78k-1(a)(1).
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B. Self-Regulatory Organization's Statement of 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 Regarding the
Proposed Rule Changes Received From Members, Participants or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Changes and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
A. By order approve such proposed rule change, or
B. Institute proceedings to determine whether the proposed rule
change should be disapproved.\7\
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\7\ The Commission notes that the exchange has requested
accelerated approval of the filing.
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposal is
consistent with the Act. Comments may be submitted by any of the
following methods:
Electronic Comments
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File No. SR-CHX-2010-10 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 No. SR-CHX-2010-10. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing 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 will
also be available for inspection and copying at the principal office of
the CHX. All comments received will be posted without change; the
Commission does not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File No. SR-CHX-
2010-10 and should be submitted on or before June 3, 2010.\8\
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\8\ The Commission believes that a 10-day comment period is
reasonable, given the urgency of the matter. It will provide
adequate time for comment.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-12423 Filed 5-21-10; 8:45 am]
BILLING CODE 8010-01-P