[Federal Register Volume 75, Number 61 (Wednesday, March 31, 2010)]
[Notices]
[Pages 16222-16224]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7106]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-61774; File No. SR-NYSEAmex-2010-24]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Amex LLC Relating to
Exchange Liability
March 24, 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 5, 2010, 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 Exchange has
designated the proposed rule change as constituting a ``non-
controversial'' rule change under paragraph (f)(6) of Rule 19b-4 under
the Act,\3\ which renders the proposal effective upon receipt by the
Commission. 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.
\3\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes new Rule 905NY regarding the Exchange's
liability for system outages. The text of the proposed rule change is
attached as Exhibit 5 to the 19b-4 form. A copy of this filing is
available on the Exchange's Web site at http:www.nyse.com, on the
Commission's Web site at http://www.sec.gov, at the Exchange's
principal office and at 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 self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change
[[Page 16223]]
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
The purpose of this filing is to clarify that that [sic] the
Exchange will generally not be held liable for any losses, expenses,
damages or claims arising out of the use of its facilities, except to
the extent that such losses, expenses, damages or claims are
attributable to the willful misconduct, gross negligence, bad faith or
fraudulent or criminal acts of the Exchange or its officers, employees
or agents acting within the scope of their authority.
Currently, NYSE Amex Rule 60 limits the liability of the Exchange
for claims arising out of use of NYSE Amex's Post Execution Reporting
(``PER'') and NYSE Alternext Options Switch (``AMOS'') systems. NYSE
Amex Rule 63 describes the Exchange's liability in general. These rules
were intended to cover both the options and equities trading platforms
of NYSE Amex. However, neither of these rules were revised following
adoption of the Section 900NY rules governing the trading of options
contracts.
The Exchange now proposes to adopt new NYSE Amex Rule 905NY to
clarify that the Exchange (i) is generally not liable for losses,
expenses, damages, or claims, arising out of the use of its facilities,
but (ii) will assume some limited liability for damages arising out of
the use of the NYSE Amex options trading platform under certain
prescribed circumstances and capped at certain prescribed amounts. The
proposed rule is substantially similar in scope to NYSE Amex Rules 60
and 63, but is modeled off NYSE Arca options Rule 14.2, Liability of
Exchange. To the extent that a conflict may arise between the proposed
Rule 905NY and either Rule 60 or 63, the new rule would take
precedence. The Exchange is in the process of reviewing Rules 60 and 63
for possible revision or deletion. NYSE Arca Rule 14.2 offers a
comprehensive and clear approach regarding liability, thus the Exchange
seeks to harmonize its approach regarding liability with that of NYSE
Arca.\4\
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\4\ This rule, as proposed shall apply only to the use of NYSE
Amex options systems and facilities.
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2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) \5\ of the Securities Exchange Act of 1934 (the ``Act''),
in general, and furthers the objectives of Section 6(b)(5) \6\ in
particular in that it is designed to promote just and equitable
principles of trade, to prevent fraudulent and manipulative acts, to
remove impediments to and to perfect the mechanism for a free and open
market and a national market system and, in general, to protect
investors and the public interest, by clarifying the extent of the
Exchange's liability for claims arising out of the use of its options
trading platform. Moreover, the proposed rule is based on NYSE Arca
Rule 14.2, Liability of Exchange.
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\5\ 15 U.S.C. 78f(b).
\6\ 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, if
consistent with the protection of investors and the public interest, it
has become effective pursuant to Section 19(b)(3)(A) of the Act \7\ and
Rule 19b-4(f)(6) thereunder.\8\
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange 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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The Exchange requested that the Commission waive the 30-day
operative delay period. The Commission notes that the proposal is
nearly identical to the rule of another self-regulatory
organization,\9\ and believes that no significant purpose is served by
delaying its operative date. The Commission therefore believes that it
is consistent with the protection of investors and the public interest
to waive the 30-day operative delay and designates the proposal as
operative upon filing.\10\
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\9\ See NYSE Arca Rule 14.2.
\10\ 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 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 (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-NYSEAmex-2010-24 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-2010-24. 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
[[Page 16224]]
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 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-2010-24 and should be submitted on or before April 21, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-7106 Filed 3-30-10; 8:45 am]
BILLING CODE 8011-01-P