[Federal Register Volume 75, Number 121 (Thursday, June 24, 2010)]
[Notices]
[Pages 36143-36144]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-15242]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62301; File No. SR-ISE-2010-49]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change Related to Do-Not-Route Orders
June 16, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is
hereby given that on June 14, 2010, the International Securities
Exchange, LLC (the ``Exchange'' or the ``ISE'') filed with the
Securities and Exchange Commission (the ``SEC'' or the ``Commission'')
the proposed rule change as described in Items I, II, and III 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.
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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
The Exchange proposes to adopt a do-not-route order type. The text
of the rule amendment is as follows (additions are in italics):
Rule 715. Types of Orders
(a) through (l) no change.
(m) Do-Not-Route Orders. A do-not-route order is a market or limit
order that is to be executed in whole or in part on the Exchange only.
Due to prices available on another options exchange (as provided in
Chapter 19 (Order Protection; Locked and Crossed Markets)), any balance
of a do-not-route order that cannot be executed upon entry, or placed
on the Exchange's limit order book, will be automatically cancelled.
Supplementary Material to Rule 715
.01 no change.
* * *
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 these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in sections A, B and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
(1) Purpose--The Exchange's rules related to intermarket linkage
provide, among other things, that transactions not be executed at
prices that are inferior to the national best bid or offer (the
``trade-through rule'').\3\ Currently, the Exchange cancels marketable
non-customer orders that cannot be executed because its prices are
inferior to the national best bid or offer, while such marketable
customer orders are presented to the primary market maker for
handling.\4\ The Exchange is proposing to adopt a do-not-route order so
that customers may indicate that they want their orders canceled if
they are marketable, but not executable on the Exchange. If a customer
order is not marked as a do-not-route order, it would continue to be
presented to the primary market maker for handling if it is marketable
but not executable on the Exchange. A do-not-route order is a market or
limit order. This order type is commonly offered on other exchanges.\5\
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\3\ ISE Rule 1901 (Order Protection).
\4\ ISE Rule 714 (Automatic Execution of Orders).
\5\ E.g., NYSE Arca Rule 6.62(p) (PNP Orders are not routable
orders); NASDAQ OMX PHLX Rule 1066(c)(8) (Immediate or Cancel Orders
are not routable orders); and CBOE Rule 6.53(s) (CBOE Only orders
are not routable orders).
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(2) Basis--The basis under the Securities Exchange Act of 1934
(``Exchange 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, and to remove
impediments to and perfect the mechanism for a free and open market and
a national market system, and in general, to protect investors and the
public interest. In particular, the proposal will give customers
greater control over where their orders are executed if they so choose.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Exchange Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received from Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days after the date of the filing, or such
shorter time as the Commission may designate, it has become effective
pursuant to Section 19(b)(3)(A) of the Act \6\ and Rule 19b-4(f)(6)
thereunder.\7\
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\6\ 15 U.S.C. 78s(b)(3)(A).
\7\ 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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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:
[[Page 36144]]
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 Number SR-ISE-2010-49 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-ISE-2010-49. 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 the
filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-ISE-2010-49 and should be submitted on or before July
15, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-15242 Filed 6-23-10; 8:45 am]
BILLING CODE 8011-01-P