Self-regulatory organizations; proposed rule changes: Chicago Stock Exchange, Inc.,
[Federal Register: June 1, 2006 (Volume 71, Number 105)]
[Notices]
[Page 31241-31242]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01jn06-119]
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-53859; File No. SR-CHX-2006-18]
Self-Regulatory Organization; Chicago Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change Waiving a Notice Provision Relating to the Renewal of Trading Permits
May 24, 2006.
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 May 10, 2006, the Chicago Stock Exchange, Inc. (``CHX'' or ``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.
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Exchange proposes to amend its rules to waive for 2006 the 60- day notice requirement relating to the cancellation of trading permits that were issued as a result of the Exchange's demutualization. The text of this proposed rule change is available on the Exchange's Web site at http://www.chx.com/rules/proposed_rules.htm and at the
Commission's Public Reference Room.
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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 change and discussed any comments it received regarding the proposal. The text of these statements 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 Change
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Purpose
At the time of the Exchange's demutualization on February 9, 2005, the Exchange issued trading permits to each member that held a CHX membership on the previous day. Pursuant to CHX Article II, Rule 3, each of these trading permits had a one-year term (through February 8, 2006) and was to be automatically renewed at the end of that term for another year (through February 8, 2007), unless the participant \3\ gave the Exchange at least 60 days' notice that the trading permit should be allowed to expire.
\3\ See CHX Article I, Rule 1(l) for the definition of a ``participant.''
Although some Exchange participants that wanted certain trading permits to expire provided the 60 days' notice contemplated by the Exchange's rules, a few participants did not. Because this is the first year of this new requirement and it appears to have created confusion among some of the Exchange's participants, the Exchange believes that it would be appropriate to waive the 60-day notice requirement in 2006. Therefore, the Exchange proposes Interpretation and Policy .01 to CHX Article II, Rule 3, which would allow for 2006 a trading permit to expire if a participant provided notice of waiver of renewal with respect to such trading permit during the 60 days preceding February 9, 2006, even though the participant did not provide the full 60 days' prior notice required by the Exchange's rules. 2. Statutory Basis
The CHX believes that the proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.\4\ The CHX believes that the proposal is consistent with Section 6(b)(5) of the Act \5\ in that it is 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 by permitting the Exchange to waive, on a one-time basis, a rule provision relating to the renewal of trading permits that caused confusion among some of the Exchange's participants.
\4\ 15 U.S.C. 78(f)(b).
\5\ 15 U.S.C. 78f(b)(5).
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.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others
No written comments were either solicited or received.
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Date of Effectiveness of the Proposed Rule Change 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.
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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 rule-comments@sec.gov. Please include
File Number SR-CHX-2006-18 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File No. SR-CHX-2006-18. 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 changes 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 inspection and copying in the Commission's Public Reference Room. 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-2006-18 and should be submitted on or before June 22, 2006.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.\6\
\6\ 17 CFR 200.30-3(a)(12).
J. Lynn Taylor, Assistant Secretary.
[FR Doc. E6-8437 Filed 5-31-06; 8:45 am]
BILLING CODE 8010-01-P
