[Federal Register Volume 75, Number 249 (Wednesday, December 29, 2010)]
[Notices]
[Pages 82117-82119]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-32734]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63601; File No. SR-NYSEAmex-2010-124]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Amex LLC Extending the
Operation of the Pilot Program That Allows Nasdaq Stock Market
Securities to be Traded on the Exchange Pursuant to a Grant of Unlisted
Trading Privileges
December 22, 2010.
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 December 20, 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 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 500 to
extend the operation of the pilot program that allows Nasdaq Stock
Market (``Nasdaq'') securities to be traded on the Exchange pursuant to
a grant of unlisted trading privileges. The pilot is currently
scheduled to expire on January 31, 2011; the Exchange proposes to
extend it until the earlier of Securities and Exchange Commission
(``SEC'' or ``Commission'') approval to make such pilot permanent or
August 1, 2011. The text of the proposed rule change is available at
the principal office of the Exchange, on the Commission's Web site at
http://www.sec.gov, at 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
Statutory Basis for, the Proposed Rule Change
1. Purpose
NYSE Amex Equities Rules 500-525, as a pilot program, govern the
trading of any Nasdaq-listed security on the Exchange pursuant to
unlisted trading privileges (``UTP Pilot Program'').\3\ The Exchange
hereby seeks to extend the operation of the UTP Pilot Program,
currently scheduled to expire on January 31, 2011, until the earlier of
[[Page 82118]]
Commission approval to make such pilot permanent or August 1, 2011.
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\3\ See Securities Exchange Act Release No. 62479 (July 9,
2010), 75 FR 41264 (July 15, 2010) (SR-NYSEAmex-2010-31) (Notice of
Filing of Amendment Nos. 2 and 3, and Order Granting Accelerated
Approval to a Proposed Rule Change, as Modified by Amendment Nos. 1,
2, and 3 Thereto, To Adopt as a Pilot Program a New Rule Series for
the Trading of Securities Listed on the Nasdaq Stock Market Pursuant
to Unlisted Trading Privileges). See also Securities Exchange Act
Release No. 62857 (September 7, 2010), 75 FR 55837 (September 14,
2010) (SR-NYSEAmex-2010-89) (Notice of Filing and Immediate
Effectiveness of Proposed Rule Change To Extend the Pilot Program
That Allows Nasdaq Stock Market Securities To Be Traded on the
Exchange Pursuant to UTP).
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The UTP Pilot Program includes any security listed on Nasdaq that
(i) is designated as an ``eligible security'' under the Joint Self-
Regulatory Organization Plan Governing the Collection, Consolidation
and Dissemination of Quotation and Transaction Information for Nasdaq-
Listed Securities Traded on Exchanges on an Unlisted Trading Privilege
Basis, as amended (``UTP Plan''),\4\ and (ii) has been admitted to
dealings on the Exchange pursuant to a grant of unlisted trading
privileges in accordance with Section 12(f) of the Securities Exchange
Act of 1934, as amended (the ``Act''),\5\ (collectively, ``Nasdaq
Securities'').\6\
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\4\ See Securities Exchange Act Release No. 58863 (October 27,
2008), 73 FR 65417 (November 3, 2008) (Notice of filing and
immediate effectiveness of Amendment No. 20 to the UTP Plan). The
Exchange's predecessor, the American Stock Exchange LLC, joined the
UTP Plan in 2001. See Securities Exchange Act Release No. 55647
(April 19, 2007), 72 FR 2091 (April 27, 2007) (S7-24-89). In March
2009, the Exchange changed its name to NYSE Amex LLC. See Securities
Exchange Act Release No. 59575 (March 13, 2009), 74 FR 11803 (March
19, 2009) (SR-NYSEALTR-2009-24).
\5\ 15 U.S.C. 78l.
\6\ ``Nasdaq Securities'' is included within the definition of
``security'' as that term is used in the NYSE Amex Equities Rules.
See NYSE Amex Equities Rule 3. In accordance with this definition,
Nasdaq Securities are admitted to dealings on the Exchange on an
``issued,'' ``when issued,'' or ``when distributed'' basis. See NYSE
Amex Equities Rule 501.
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The Exchange notes that its New Market Model Pilot (``NMM Pilot''),
which, among other things, eliminated the function of specialists on
the Exchange and created a new category of market participant, the
Designated Market Maker (``DMM''),\7\ is also scheduled to end on
January 31, 2011.\8\ The timing of the operation of the UTP Pilot
Program was designed to correspond to that of the NMM Pilot. In
approving the UTP Pilot Program, the Commission acknowledged that the
rules relating to DMM benefits and duties in trading Nasdaq Securities
on the Exchange pursuant to the UTP Pilot Program are consistent with
the Act \9\ and noted the similarity to the NMM Pilot, particularly
with respect to DMM obligations and benefits.\10\ Furthermore, the UTP
Pilot Program rules pertaining to the assignment of securities to DMMs
are substantially similar to the rules implemented through the NMM
Pilot.\11\ The Exchange has similarly filed to extend the operation of
the NMM Pilot until the earlier of Commission approval to make the NMM
Pilot permanent or August 1, 2011.\12\
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\7\ See NYSE Amex Equities Rule 103.
\8\ See Securities Exchange Act Release No. 60758 (October 1,
2009), 74 FR 51639 (October 7, 2009) (SR-NYSEAmex-2009-65). See also
Securities Exchange Act Release Nos. 61030 (November 19, 2009), 74
FR 62365 (November 27, 2009) (SR-NYSEAmex-2009-83); 61725 (March 17,
2010), 75 FR 14223 (March 24, 2010) (SR-NYSEAmex-2010-28); and 62820
(September 1, 2010), 75 FR 54935 (September 9, 2010) (SR-NYSEAmex-
2010-86).
\9\ 15 U.S.C. 78.
\10\ See supra note 1, at 41271.
\11\ Id.
\12\ See SR-NYSEAmex-2010-122.
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Extension of the UTP Pilot Program in tandem with the NMM Pilot,
both from January 31, 2011 until the earlier of Commission approval to
make such pilots permanent or August 1, 2011, will provide for the
uninterrupted trading of Nasdaq Securities on the Exchange on a UTP
basis and thus continue to encourage the additional utilization of, and
interaction with, the NYSE Amex Equities market, and provide market
participants with improved price discovery, increased liquidity, more
competitive quotes and greater price improvement for Nasdaq Securities.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the requirements of the Act and the rules and regulations
thereunder applicable to a national securities exchange. In particular,
the Exchange believes that its proposal is consistent with (i) Section
6(b) of the Act,\13\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\14\ in particular, in that it is designed to
prevent fraudulent and manipulative acts and practices, 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; (ii)
Section 11A(a)(1) of the Act,\15\ in that it seeks to ensure the
economically efficient execution of securities transactions and fair
competition among brokers and dealers and among exchange markets; and
(iii) Section 12(f) of the Act,\16\ which governs the trading of
securities pursuant to UTP consistent with the maintenance of fair and
orderly markets, the protection of investors and the public interest,
and the impact of extending the existing markets for such securities.
Under the UTP Pilot Program Nasdaq Securities trade on the Exchange
pursuant to rules governing the trading of Exchange-Listed securities
that previously have been approved by the Commission. NYSE Amex made
certain minor modifications to the operation of these rules, and added
certain new rules, to accommodate the trading of Nasdaq Securities on a
UTP basis; the Commission also approved all of these modifications and
additions.
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\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(5).
\15\ 15 U.S.C. 78k-1(a)(1).
\16\ 15 U.S.C. 78l(f).
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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
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \17\ and Rule 19b-4(f)(6) thereunder.\18\
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; and (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 \19\ and Rule 19b-
4(f)(6) thereunder.\20\
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\17\ 15 U.S.C. 78s(b)(3)(A)(iii).
\18\ 17 CFR 240.19b-4(f)(6).
\19\ 15 U.S.C. 78s(b)(3)(A).
\20\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's 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 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
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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-2010-124 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-2010-124. 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, 100 F
Street, NE., Washington, DC 20549, 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-2010-124 and should be submitted on or before January 19,
2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\21\
Florence E. Harmon,
Deputy Secretary.
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\21\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2010-32734 Filed 12-28-10; 8:45 am]
BILLING CODE 8011-01-P