[Federal Register Volume 75, Number 187 (Tuesday, September 28, 2010)]
[Notices]
[Pages 59753-59755]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-24178]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62963; File No. SR-NYSEAmex-2010-71]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Amex LLC Amending NYSE
Amex Equities Rule 36
September 21, 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 September 14, 2010, the NYSE Amex LLC (``NYSE Amex'' or the
``Exchange'') 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 Exchange. 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 amend NYSE Amex Equities Rule 36
(``Communications Between Exchange and Members' Offices'') to
incorporate the provisions of its current Wireless Policy. The text of
the proposed rule change is available at the Exchange, the Commission's
Public Reference Room, and http://www.nyse.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
NYSE Amex proposes to amend NYSE Amex Equities Rule 36
(``Communications Between Exchange and Members' Offices'') to
incorporate
[[Page 59754]]
the provisions of its current Wireless Policy into Supplementary
Material .70 of the Rule.\3\ The Wireless Policy was previously
approved by the Commission.\4\
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\3\ The Exchange notes that parallel changes are proposed to the
rules of its affiliate, The New York Stock Exchange LLC. See SR-
NYSE-2010-53.
\4\ See Securities Exchange Act Release No. 59627 (March 25,
2009), 74 FR 14834 (April 1, 2009) (SR-NYSEAmex-2009-02). The
Wireless Policy was attached as an exhibit to that proposed rule
change.
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Background
Current NYSE Amex Equities rules permit a Floor broker to
communicate information to a customer using a wired telephone line,\5\
NYSE Amex approved portable telephones,\6\ or through a written
electronic communication from the Floor brokers' hand-held device as
permitted by the NYSE Amex's ``Wireless Data Communications
Initiatives.'' Wireless communications can be sent and received
directly to and from a Floor broker's hand-held device and orders
entered from off the Floor may be transmitted directly to a hand-held
device, bypassing the booth. Floor brokers may send order-related
messages and information (e.g., cancellations and administrative
messages, as well as market probes and market looks) back to the
customer directly through the hand-held device.
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\5\ NYSE Amex Equities Rule 36.20.
\6\ NYSE Amex Equities Rule 36.21.
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Pursuant to the Exchange's Wireless Policy, a record must be
established and maintained for transmissions that are sent: (1) From a
member's off-Floor location to a booth terminal and then retransmitted
from the booth terminal to a member's hand-held device; or (2) directly
to the hand-held device, bypassing the booth. Orders sent from off-
Floor to the booth or the hand-held device are first sent through a
secured network and routed to an Exchange-wired database that captures
and records the orders. Likewise, order-related messages or information
generated from the Floor broker's booth or hand-held device are
transmitted back to the Exchange-wired databases via the secured
wireless network, where the information is captured and recorded, and
then sent off-Floor to the customer via the Exchange's secured network.
The Exchange records all of the information sent to and transmitted
from the hand-held devices.
Proposed Amendments to NYSE Amex Equities Rule 36
The Exchange proposes to revise NYSE Amex Equities Rule 36 to
incorporate the provisions of its Wireless Policy, previously approved
by the Commission, in Supplementary Material .70 of the Rule. In
addition, the Exchange is making certain clarifying changes as part of
the incorporation of the Wireless Policy into the Rule.
First, the Exchange proposes to clarify the language in
Supplementary Material .70 and the Wireless Policy by using consistent
terminology when referring to the hand-held devices in the proposed
rule change. Thus, for example, references in paragraph (a) of the
current Supplementary Material to ``wireless trading devices'' would be
changed to ``wireless hand-held devices.'' The use of consistent
terminology would make clear that the Exchange is referencing the same
type of device in both paragraphs of the proposed rule.
Second, the Exchange is clarifying that Floor brokers may send
order-related messages outside their member organizations only to
customers. In this regard, the Exchange is clarifying the rule text to
provide that order-related messages and information include market
looks. The Exchange also notes that a customer must be specifically
enabled by the Floor broker to receive communications from the Floor
broker's hand-held device.
For purposes of this proposed rule change, the term ``customer''
means a person who the Floor broker reasonably believes is receiving
the order-related message(s) in consideration of a securities
transaction or potential securities transaction with the Floor broker.
Whether such a belief is reasonable is based on the relevant facts and
circumstances including, without limitation: Whether the customer is a
bona fide market participant; any prior history of the customer
entering orders with the Floor broker for execution on the Exchange;
and acknowledgement by the customer (including by negative consent)
that the customer is receiving order-related messages in consideration
of a securities transaction or potential securities transaction with
the Floor broker. A Floor broker may provide order-related messages to
a customer pursuant to proposed Supplementary Material .70
notwithstanding the fact that the customer's receipt of particular
messages does not lead to an order with the Floor broker.
Third, the Exchange is clarifying that the Wireless Policy does not
allow Floor brokers to retransmit datafeeds received on hand-held
devices or send orders to another hand-held device.\7\
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\7\ However, Floor brokers are permitted to provide their
customers with specific data points from datafeeds made available on
the hand-held devices.
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Fourth, the Exchange is clarifying that Floor brokers may send
trade reports on their hand-held devices.
Finally, the Exchange is clarifying that the Wireless Policy
applies not only to member organizations but also to employees of
member organizations.
As proposed, Supplementary Material .70 is substantially similar to
the Exchange's Wireless Policy as previously filed with and approved by
the Commission.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \8\ 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 instant proposal is in keeping
with these principles because the incorporation of the Wireless Policy
in the Exchange's rules promotes transparency and makes clear what type
of information may be communicated to and from hand-held devices.
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\8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change 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 from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \9\ and Rule 19b-
4(f)(6) thereunder.\10\
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
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.
NYSE Amex has satisfied this requirement.
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[[Page 59755]]
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \11\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6) \12\ permits the Commission to
designate a shorter time if such action is consistent with the
protection of investors and the public interest. NYSE Amex requests
that the Commission waive the 30-day operative delay so that the
proposal may become operative immediately upon filing. The Commission
notes that the proposed rule change codifies into rule text an existing
policy and provides certain other clarifications. For this reason, the
Commission believes that waiving the 30-day operative delay \13\ is
consistent with the protection of investors and the public interest.
Therefore, the Commission designates the proposal operative upon
filing.
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\11\ 17 CFR 240.19b-4(f)(6).
\12\ 17 CFR 240.19b-4(f)(6).
\13\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within the 60-day period beginning on the date of the
filing of the proposed rule change, the Commission summarily may
temporarily suspend 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 (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-NYSEAmex-2010-71 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-2010-71.
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,\14\ 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 website 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-NYSEAmex-2010-71 and should
be submitted on or before October 19, 2010.
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\14\ The text of the proposed rule change is available on the
Commission's Web site at http://www.sec.gov/rules/sro.shtml.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-24178 Filed 9-27-10; 8:45 am]
BILLING CODE 8010-01-P