Self-regulatory organizations; proposed rule changes: Pacific Exchange, Inc.,
[Federal Register: February 11, 2005 (Volume 70, Number 28)]
[Notices]
[Page 7316-7318]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11fe05-119]
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-51145; File No. SR-PCX-2005-02]
Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Market Maker Cleanup Order Administrative Change
February 7, 2005.
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 January 21, 2005, the Pacific Exchange, Inc.
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(``PCX'' 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 PCX. The Exchange filed this proposal pursuant to Section 19(b)(3)(A) of the Act,\3\ and Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective upon filing with the Commission. 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.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6).
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Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The PCX, through its wholly-owned subsidiary PCX Equities, Inc. (``PCXE'' or ``Corporation''), proposes to amend its rules governing the Archipelago Exchange (``ArcaEx''), the equities trading facility of PCXE. With this filing, PCX proposes to delete PCXE Rule 7.23(a)(6) in order to conform to a previous rule change. The text of the proposed rule change is available on the PCX's Web site (http://www.pacificex.com), at
the PCX's Office of the Secretary, 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 PCX 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 PCX has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
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Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
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Purpose
On October 23, 2003, the Exchange filed a rule proposal with the Commission to amend its rules governing Market Maker obligations on ArcaEx.\5\ Specifically, the Exchange proposed to modify PCXE Rule 7.25(b) to eliminate the stipulation that Market Makers must become Odd Lot Dealers in the securities in which they are registered. In addition, the Exchange proposed to modify PCXE Rule 7.34(b) to eliminate the requirement that Market Makers must maintain one Cleanup Order for all of the securities in which they are registered. The amendment was intended to facilitate additional Market Maker participation on ArcaEx and to further enhance order interaction, provide greater depth in liquidity, and foster price competition. The Commission approved the proposed rule change on February 3, 2004.\6\
\5\ See SR-PCX-2003-59.
\6\ See Securities Exchange Act Release No. 49176 (February 3, 2004), 69 FR 6356 (February 10, 2004) (Order approving SR-PCX-2003- 59).
At this time, the Exchange proposes to delete PCXE Rule 7.23(a)(6) to conform to the previous rule change, which the Exchange inadvertently failed to delete as part of the filing in October 2003.\7\ PCXE Rule 7.23(a) details the obligations of Market Makers and subsection (6) requires Market Makers to maintain one Cleanup order in each security in which the Market Maker is registered as such for each Market Order Auction. The Exchange proposes to delete this provision as obsolete given the aforementioned rule change that was approved by the Commission.
\7\ See supra note 5.
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Statutory Basis
The Exchange believes that the proposed rule change is consistent with section 6(b) of the Act,\8\ in general, and furthers the objectives of section 6(b)(5),\9\ in particular, because it is designed to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments and perfect the mechanisms of a free and open market and to protect investors and the public interest.
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
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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.
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Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
Written comments on the proposed rule change were neither solicited nor received.
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Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
Because the foregoing rule change does not: (1) Significantly affect the protection of investors or the public interest; (2) impose any significant burden on competition; and (3) 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, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act\10\ and Rule 19b-4(f)(6) thereunder.\11\ At any time within 60 days of the filing of such 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.
\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6).
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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 rule-comments@sec.gov. Please include
File Number SR-PCX-2005-02 on the subject line.
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609.
All submissions should refer to File Number SR-PCX-2005-02. This file number should beincluded 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
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available for inspection and copying in the Commission's Public Reference Section, 450 Fifth Street, NW., Washington, DC 20549. 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-PCX-2005-02 and should be submitted on or before March 4, 2005.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.\12\ Margaret H. McFarland, Deputy Secretary.
\12\ 17 CFR 200.30-3(a)(12).
[FR Doc. E5-582 Filed 2-10-05; 8:45 am]
BILLING CODE 8010-01-P
