[Federal Register Volume 69, Number 245 (Wednesday, December 22, 2004)]
[Notices]
[Pages 76808-76815]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-27941]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50854; File No. SR-PCX-2004-122]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the Pacific Exchange, Inc. Relating to the Implementation of 
a New Order Audit Trail System

December 14, 2004.
    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 14, 2004, the Pacific Exchange, Inc. (``PCX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'' or ``SEC'') the proposed rule change as described in 
Items I, II and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comment on the proposed rule change from interested persons.
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    \1\ 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 its rules relating to the 
systematization of orders in connection the requirement to design and 
implement a consolidated options audit trail system (``COATS''). The 
text of the proposed rule change appears below. Additions are 
italicized; deletions are in brackets.
* * * * *
Rule 6
Options Trading
Applicability, Definitions and References
    Rule 6.1(a)--No change.
    (b) Definitions. The following items as used in Rule 6 shall, 
unless the context otherwise indicates, have meanings herein specified:
    (1)-(38)--No change.
    (39) The term ``Electronic Order Capture System (``EOC'') means the 
Exchange's electronic audit trail and order tracking system that 
provides an accurate time-sequenced record of all orders and 
transactions on the Exchange pursuant to Section IV.B.e.(v) of the 
Commission's order Instituting Public Administrative Proceedings 
Pursuant to Section 19(h)(1) of the Securities Exchange Act of 1934, 
Making Findings and Imposing Remedial Sanctions. EOC records the 
receipt of an order and documents the life of the order through the 
process of execution, partial execution, or cancellation. This system 
includes the electronic communications interface between EOC booth 
terminals and then Floor Broker Hand Held applications. Each OTP Holder 
or OTP Firm's EOC booth terminal and each Floor Broker Hand Held 
Terminal contains an electronic order entry screen that displays the 
terms and conditions of each order received by that OTP Holder or OTP 
Firm. OTP Holders and OTP Firms may record the details of the order 
directly into the EOC system as described herein, or, in the 
alternative, into the Electronic Tablet described in subsection (b)(40) 
below.
    (40) The term ``Electronic Tablet'' means the Exchange's electronic 
method of recording orders that are hand written and transmitted to a 
Floor Broker's workstation for representation in order to create an 
accurate time-sequenced record of orders on the Exchange. The 
Electronic Tablet will automatically timestamp the receipt of an order 
when such order is transmitted to a Floor Broker's workstation for 
representation in the trading crowd and document the life of the order 
through the process of execution, partial execution or cancellation. 
This system includes the ability for a Floor Broker to hand write order 
information and automatically timestamp the report and provides a 
method to display report images at an OTP Holder or OTP Firm's 
workstation to manually key the order information for clearing 
purposes. Such clearing information will become part of the data 
required pursuant to Section IV.B.e.(v) of the commission's Order 
Instituting Public Administrative Proceedings Pursuant to Section 
19(h)(1) of the Securities Exchange Act of 1934, Making Findings and 
Imposing Remedial Sanctions. OTP Holders and OTP Firms may record the 
details of the order directly into the EOC system (as

[[Page 76809]]

described above in subsection (b)(39)) or, in the alternative, into the 
Electronic Tablet as described herein.
    (c)-(e)--No change.
* * * * *

Admission to and Conduct on the Options Trading Floor

    Rule 6.29a)-(g)--No change.
    (h)(1)-(2)--No change.
    (3) Requirements and Conditions.
    (A)--No change.
    (B) Orders transmitted by registered Exchange Market Makers may be 
entered directly to the trading posts. All other orders may b e entered 
directly to the trading posts only during outgoing telephone calls that 
are initiated at the option posts. Pursuant to Rule 6.67(c), all such 
orders must be immediately recorded into the EOC or the Electronic 
Tablet unless the exception set forth in Rule 6.67(d)(1)(A) applies, in 
which case the EOC/Electronic Tablet Contingency Reporting Procedures 
will be in effect in accordance with Rule 6.67(d)(2).
    (C)--No change.
    (4)--No change.
    (5) Floor Brokers.
    (A)-(B)--No change.
    (C) EOC or Electronic Tablet Ticket to Follow Procedures Pursuant 
to Rule 6.67(d)(1)(A). A Floor Broker in a trading crowd who receives a 
telephonic [a] order from an OTP Holder or OTP Firm representative 
located on the Trading Floor may represent that order immediately in 
the trading crowd, provided (a) that an order ticket for the order must 
be prepared and time stamped in the OTP Holder or OTP Firm booth before 
the order is transmitted telephonically to the Floor Broker and 
represented in the trading crowd; and (b) that the written, time-
stamped order ticket for the order must be taken to the Floor Broker in 
the trading crowd immediately after it has been prepared.
    (D)--No change.
    (6)-(10)--No change.
    Commentary:
    .01-.02--No change.
    .03 While on the Trading Floor, clerks must [shall] display at all 
times the badge(s) supplied to them by the Exchange. [Any Market-Maker 
clerk who writes up an option order on the Options Floor must give his 
employer a copy of that order before it is delivered; the employer must 
retain the copy on his person until it is executed.] A clerk receiving 
a phone order must immediately record the details of the order into EOC 
or the Electronic Tablet pursuant to Rule 6.67(c), except as otherwise 
provided in Rule 6.67(d)(1)(A). [must initial, must mark as opening or 
closing and must time-stamp the order.]
    .04--No change.
* * * * *

Fast Markets and Unusual Market Conditions

    Rule 6.28(a)--No change.
    (b)(1)--No change.
    (2) For orders excepted from EOC or the Electronic Tablet, pursuant 
to Rule 6.67(d)(1)(A), [T]the OBO may temporarily move less active 
issues to another post if the Book is extremely active. [Books left at 
the post may be separated and order shoes provided for the most active 
series to facilitate order flow. A special time stamp will be placed 
behind the Book to stamp incoming transactions before they go to Price 
Reporting.]
    (3)-(6)--No change.
    (c)-(d)--No change.
* * * * *

Appointment of Market Makers

    Rule 6.35--No change.
    Commentary:
    .01-.03--No change.
    .04 For the purposes of this rule, temporarily undertaking the 
obligations of a Primary Appointment with respect to non-Primary 
Appointment classes of option contracts at the request of an Exchange 
OTP Holder or OTP Firm shall not be deemed trading in non-Primary 
Appointment classes. In addition, a Market Makers' trades effected 
through a Floor Broker do not count for nor against the Market Maker's 
75% requirement, regardless of whether the trades are in issues within 
or without his Primary Appointment. Also, Market Makers who are 
solicited on an order on behalf of an account other than that of 
another Market Maker may accommodate such orders, provided that the 
orders are clearly announced in the trading crowd as solicited, and 
such transactions shall not count for nor against the 75% requirement. 
Such orders [trades] must [shall] be designed by the Market Maker with 
an ``S'' in the ``[o]Optional Data'' field [section] of [the] EOC or 
the Electronic Tablet or, for orders excepted from EOC or the 
Electronic Tablet pursuant to Rule 6.67(d)(1)(A), in the ``Optional 
Data'' section of the trade ticket.
    .05--No change.
* * * * *

Crossing Orders and Stock/Option Orders

    Rule 6.47(a)--No change.
    (b) Crossing of Facilitation Orders. A Floor Broker who holds an 
order for a public customer or a broker-dealer (``customer order'') and 
an order for the proprietary account of an OTP Holder OTP Firm that is 
representing that customer (the ``facilitation order'') may cross such 
orders only if the following procedures are followed.
    (1)--No change. (2) The option order tickets for both the 
[f]Facilitation orders and [the] customer orders must be entered into 
EOC or the Electronic Tablet and [display] all of the terms of such 
orders, including any contingencies involving, and all related 
transactions in, either options or underlying or related securities, 
must be displayed on EOC or the Electronic Tablet. If facilitation 
orders and customer orders are excepted from EOC or the Electronic 
Tablet, pursuant to Rule 6.67(d)(1)(A), then order tickets must display 
this same information. The Floor Broker must disclose all securities 
that are components of the customer order.
    (3)-(6)--No change.
    (c)--No change.
    (1)-(3)--No change.
    (4) ``Solicited'' must [shall] be entered [written] in the 
``Optional Data'' field of the EOC or the Electronic Tablet or, for 
orders excepted from EOC or the Electronic Tablet pursuant to Rule 
6.67(d)(1)(A), written in the ``Optional Data'' section of the trade 
ticket. [area on the order ticket of the solicited order. If the 
solicited order is for a market maker account, the order ticket shall 
be personally initialed by the solicited market maker, who must have in 
his possession a copy of such order ticket at all times such order is 
active.]
    (5)--No change.
    (d)-(e)--No change.
    (f)(1) Stock/Option and SSF/Option Orders. When a stock/option 
order is taken to a crowd for execution, the stock transaction or SSF 
transaction must be effected prior to the option transaction pursuant 
to Rule 6.47, Commentary .04. The following procedure applies to all 
executions of stock/option and SSF/option orders: [A]after an agreement 
with other OTP Holders or OTP Firms of the crowd has been reached as to 
the terms of the transaction, the option order must be entered into EOC 
or the Electronic Tablet or, for orders excepted from EOC or the 
Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), written on tickets 
[must be written up] and time stamped. However, the option transaction 
will [order tickets should] not be reported to Options Price Reporting 
Authority (``OPRA'') by EOC or Electronic Tablet or, for orders 
excepted from EOC or the Electronic Tablet, pursuant to Rule 
6.67(d)(1)(A), turned in to the Order Book Official at this time. The 
OTP Holders or OTP

[[Page 76810]]

Firms will [shall] attempt to immediately effect the transaction in the 
underlying or related security. If the stock transaction cannot be 
executed immediately or is effected at a price other than an [the] 
agreed-upon price, the OTP Holders or OTP Firms will [shall] not be 
held to the option transaction. If the stock transaction is effected at 
an [the] agreed-upon price, then all the OTP Holders or OTP Firms who 
participated in the option transaction will [shall] be held to their 
agreed-upon price. At the time the stock transaction is effected, the 
option transaction must be immediately entered into EOC or the 
Electronic Tablet and reported to OPRA or, for orders excepted from EOC 
or the Electronic tablet, pursuant to Rule 6.67(d)(1)(A), trade tickets 
must [should] be given to the Order Book Official.
    (f)(2)--No change.
    Commentary:
    .01-.06--No change.
* * * * *

Discretionary Transactions

    Rule 6.48.(a)-(b)--No change.
    (c) A Market Marker shall not exercise discretion in an account 
unless he has a direct interest in such account. Market Makers may not 
exercise discretion over any account other than: A joint account 
approved pursuant to Rule 6.39, or an account in which the Market Maker 
has a direct interest. For purposes of this Rule, the term ``direct 
interest'' in an account is limited in its meaning to include only a 
participation in the profits and losses in such account, or in the case 
of a partnership or corporation, a representative of such partnership 
or corporation who has a supervisory responsibility over such account. 
Only persons registered as Market Makers and subject to the performance 
obligations set forth in Rule 6.37, may exercise discretion over an 
account.
    (1) A Market Maker wishing to effect such discretionary 
transactions for accounts other than the Market Maker's personal 
account or a joint account must enter the order with a Floor Broker and 
the procedures set forth in Rule 6.85. The identification of the order 
as a discretionary order is required pursuant to [PCX] Rule 6.68(a)(5). 
[(7), ``Record of Orders.'']
    (A) The clearing acronym [name] of the Market Maker for whom the 
transaction is being executed must be [printed at the bottom of the 
ticket (B-6-1(c)),] entered into EOC or the Electronic Tablet, for 
orders excepted from EOC or the Electronic Tablet, pursuant to Rule 
6.67(d)(1)(A), written on the ticket along with the clearing acronym 
[badge number] of the Market Maker exercising discretion [(i.e. e.g., 
Joe Trader/MO7)]; and
    (B) A``D'' must be placed after the Market Maker's clearing acronym 
[number,] for whose account the trade is executed[, in the firm box 
(e.g., MO5 D)].

Solicited Transactions

    Rule 6.49(a)-(b)--No change.
    (c) ``Solicited'' must [shall] be entered [written] in the 
``Optional Data'' field of EOC or the Electronic Tablet for [area on 
the order ticket of] the Solicited order. For orders excepted from EOC 
or the Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), ``Solicited'' 
must be written in the ``Optional Data'' section on the order ticket of 
the Solicited order.
* * * * *

ORDER BOOK OFFICIALS

Order Book Official Defined
Obligations for Orders
    Rule 6.52(a)-(d)--No change.
    Commentary:
    .01.-.03--No change.
    .04 For purposes of this Section, orders excepted from EOC or the 
Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), will be within the 
custody of Order Book Officials only when they have been deposited, 
properly time-stamped and marked, in the proper receptacle.
    .05-No change.
* * * * *

Certain Types of Orders Defined

    Rule 6.62(a)-(b)--No change.
    (c) A contingency order is a limit or market order to buy or sell 
that is contingent upon a condition being satisfied. [while the order 
is at the Post.]
    (d)--No change.
    (e) Not held order. A not held order is an order that provides a 
broker with discretion as to price or time in executing the order. A 
``not held'' order must be designated as such in the ``Optional Data'' 
field of the EOC or the Electronic Tablet. For orders excepted from EOC 
or the Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), a [A] not 
held order [is an order that] is market ``not held'', ``NH'', ``take 
time'' or marked with some [that bears any] qualifying notation giving 
discretion as to the price or time at which such order is to be 
executed. The ``not held'' designation must appear in the ``special 
instructions'' portion of the order ticket. Orders that merely include 
a ``not held'' designation as part of the time stamp will not be deemed 
to be ``not held'' orders.
    (f)-(k)--No change.
* * * * *

Order Format and System Entry Requirements

[Orders Required to be in Written Form]
    Rule 6.67(a). Transmitted to the Floor. Each order transmitted to 
the Floor must be recorded legibly in a format [written form] that has 
been approved by the Exchange, and the OTP Holder receiving such order 
must record the time of its receipt on the Floor. Each such order must 
be in a legible format [written form] when transmitted [taken] to the 
post for attempted execution. Orders sent electronically through the 
Exchange's Member Firm Interface or orders entered into the Exchange's 
EOC or the Electronic Tablet are [deemed to be written] approved 
formats (as described in subsection (b) below) for transmitting orders 
for purposes of Rule 6.67.
    (b) Order Format Requirements. Orders sent to the Exchange for 
execution must comply with the order format requirements established by 
the Exchange relating to, among other things, option symbol, expiration 
month, exercise price, type of option (call or put), quantity of option 
contracts, clearing member organization, whether the order is to buy or 
sell, and whether the order is market or limit.
    [(b) Cancellations and changes. Each cancellation of, or change to, 
an order that has been transmitted to the Floor must be recorded 
legibly in a written form that has been approved by the Exchange, and 
the OTP Holder receiving such cancellation or change must record the 
time of its receipt on the Floor.] (c) EOC or Electronic Tablet Entry 
Requirement. Every OTP Holder or OTP Firm that receives an order for 
execution on the Exchange must immediately, prior to representation in 
the trading crowd, record the details of the order (including any 
modification of the terms of the order or cancellation of the order) 
into either the EOC or the Electronic Tablet, unless such order has 
been entered into the Exchange's other electronic order processing 
facilities (e.g., orders sent electronically through the Exchange's 
Member Firm Interface).
    (1) EOC. The details of each order required to be recorded upon 
receipt must include the data elements prescribed in Rule 6.68(a)(1) 
through (9), and such other information as may be required by the 
Exchange from time to time. The remaining elements prescribed in Rule 
6.68(a) shall be recorded as the events occur and/or during trade 
reporting procedures.

[[Page 76811]]

    (2) Electronic Tablet. The details of each order required to be 
recorded upon receipt must include the data elements prescribed in Rule 
6.68(a)(1) through (6), and such other information as may be required 
by the Exchange from time to time. The remaining elements prescribed in 
Rule 6.68(a) shall be recorded as the events occur and/or during trade 
reporting procedures.
    [(c) Executions. An OTP Holder transmitting from the Floor a report 
of the execution of an order must record the time at which a report of 
such execution is received by such OTP Holder.]
    (d)(1) Exceptions to EOC or Electronic Tablet Entry Requirements. 
The EOC or Electronic Tablet entry requirement provision of subsection 
(c) will not apply to the following:
    (A) Any EOC or Electronic Tablet system disruption or malfunction 
as confirmed by two Trading Officials or Exchange staff (as designated 
by the Chief Regulatory Officer).
    (2) EOC/Electronic Tablet Contingency Reporting Procedures. If the 
exception set forth in subsection (d)(1)(A) applies, then the following 
procedures must be followed.
    (A) OTP Holders and OTP Firms shall use a backup supply of tickets 
to record the details of all orders (the data elements of which are 
prescribed in Rule 6.68(a)(1) through (9)), received through non-
electronic means. The order ticket must be processed in accordance with 
Rule 6.2(h)(5)(C). All order events (i.e., receipt, changes, execution, 
partial execution, cancellation, or nothing done) must be immediately 
time stamped (a time stamp synchronized with the National Institute of 
Standards and Technology Atomic Clock in Boulder Colorado ``NIST 
Clock'' will be available at all OTP Holder and OTP Firm booths and 
trading posts).
    (B) During such circumstances, existing rules on manual processing 
of order tickets are applicable.
    (C) If there is an EOC or Electronic Tablet system disruption/
malfunction as set forth in subsection (1)(A), the EOC or Electronic 
Tablet order entry requirements in Rule 6.67(c) will be reinstated once 
the disruption/malfunction to the EOC or Electronic Tablet system has 
been corrected as determined by one Trading Official or Exchange staff 
(as the case may be). Once the disruption/malfunction to the EOC or 
Electronic Tablet system has been corrected, all OPT Holders and OTP 
Firms affected by the system disruption/malfunction must input all 
relevant orders into an EOC device via the ``as-of'' field, noting the 
times of events of the orders. The required information must be entered 
into EOC by such prescribed period of time, as determined by the 
Exchange, following the trade, but no later than the end of the trading 
day that such trade occurred (or on the day the order was received if 
no trade was executed). Any OTP Holder or OTP Firm who fails to follow 
such procedures will be subject to disciplinary action pursuant to Rule 
10.
    [(d) A Floor Broker may represent a telephonic order, with a ticket 
to follow, as provided in Rule 6.2(h)(4)(C).]
    [(e) Hand Signals. The following regulations govern the proper use 
of hand signals on the Options Trading Floor: (1) Hand signals may 
always be used to request and to relay information regarding current 
quotations and market size. Hand signals may also be used to increase 
or decrease the size of an order, to change the order's limit, to 
cancel an order or to activate a market order.
    Any cancellation of or change to an order relayed to a Floor Broker 
through the use of hand signals also must be relayed to the Floor 
Broker in a time stamped, written form immediately thereafter. All 
cancellations and changes of orders held by the Order Book Official 
must be in written form. Executing brokers who receive such 
communications must have a written order in their possession with all 
of the following information on the ticket:
    Underlying security ticker symbol
    Expiration month
    Striking price
    Volume
    Purchase or Sale Notation
    Whether Market or Limit Order
    (2) Cancellaiton of orders held by the Floor Broker must be in 
written form in accordance with current practice. A Floor Broker may 
cancel an order through the use of hand signals if it is followed 
immediately by written cancellation. (3) Any change to an order must be 
documented in writing outside of the crowd and the ticket time-stamped, 
before the revised order may be represented.] [(f) Any OTP Holder 
desiring to use an order form in a format other than that provided by 
the Exchange must submit such form to the Exchange and obtain its 
approval prior to using such form on the Floor.]
    (e) The system entry requirement prescribed in subsection (c), 
above, will be operative on or before January 10, 2005.
    Commentary .01: FLEX and Cabinet Trades are exempt from the EOC and 
Electronic Tablet Entry Requirements as set forth in Rule 6.67(c). Such 
trades shall be processed using manual time stamped order tickets. The 
PCX will maintain a separate record (i.e., spreadsheet) of quotes, 
orders and transactions related to such trades in the same format 
require pursuant to Section IV.B.e.(v) of the Commission's order 
Instituting Public Administrative Proceedings Pursuant to Section 
19(h)(1) of the Securities Exchange Act of 1934, Making Findings and 
Imposing Remedial Sanctions.
* * * * *

Record of Orders

    Rule 6.68(a). Every OTP Holder or OTP Firm must [shall] maintain 
and preserve for the period specified under SEC Rule 17a-4, a [written] 
record of every order and of any other instruction given or received 
for the purchase or sale of option contracts. The Exchange shall 
maintain and preserve all electronic orders on behalf of the OTP Holder 
or OTP Firm. Such record must [shall] show the terms and conditions 
(market order, limit order, etc.) of the order or instruction and of 
any modification or cancellation thereof, and in addition must [shall] 
include:
    [(1) the account designation for which such order is to be 
executed; (2) the date and time stamp indicating the time the order was 
entered and executed or cancelled; (3) the type of option and the 
underlying stock; (4) the expiration month, the exercise price, the 
number of option contracts and the execution price (premium); (5) 
whether the order is a purchase or a sale (writing) and whether the 
order is an opening or a closing transaction; (6) whether the order is 
solicited or unsolicited; and (7) whether the order is discretionary.]
    (1) CMTA Information and claring OTP Holder or Firm;
    (2) Option symbol, expiration month, exercise price, and type of 
option (call or put);
    (3) Side of market (buy or sell) and order type (customer, firm, 
firm market maker);
    (4) Quantity of option contracts;
    (5) Any limit price, stop price, or special conditions;
    (6) Opening or closing transaction;
    (7) Time in force;
    (8) Account origin code;
    (9) Solicited or unsolicited;
    (10) Order identification number;
    (11) Order entry date and time, or the date and time of any 
modification of the terms of the order or cancellation of the order;
    (12) Order execution time and price;
    (13) Identity of the executing broker and the other party to the 
transaction; and
    (14) Such other information as may be required by the Exchange.
    (b) Record Retention for Orders Excepted from EOC or the Electronic

[[Page 76812]]

Tablet Pursuant to Rule 6.67(d)(1)(A). In addition to the white 
(control) copy, and/or hard copy, which must be kept for the entire 
amount of time specified in Securities Exchange Act Rule 17a-4, the 
green (commission) copy must also be retained for a minimum of 48 hours 
from the trade date. In the case of those orders executed by 
independent Floor Brokers, it is their responsibility to retain the 
green (commission) copy, and the executing OTP Holder must retain the 
white or hard copy. Also, all such records must be readily available 
for use on the trading floor for the resolution of any problems 
relating to the execution of these orders.
* * * * *

Reporting Duties

    Rule 6.69(a)-(e)--No change.
    Commentary:
    .01 EOC or Electronic Tablet Reporting Procedure. The Exchange has 
established the following procedure for reporting of transactions 
pursuant to Rule 6.69. For each transaction on the Exchange in which an 
OTP Holder [he] participates as seller, that [a floor] OTP Holder will 
[shall] immediately record into EOC or the Electronic Tablet, [on a 
card or ticket in a form acceptable to the Committee his] its assigned 
broker initial code, the symbol of the underlying security, the type, 
expiration month and exercise price of the option contract sold, the 
transaction price, the number of contract units comprising the 
transaction, the name of the contra clearing member, and the assigned 
broker initial code of the contra OTP Holder or OTP Firm. OTP Holders 
or OTP Firms must report any [shall identify price reporting tickets 
which represent the] partial execution of a larger order into EOC or 
the Electronic Tablet [the manner prescribed by the Exchange. The card 
or ticket for a]Any agency order must [shall] also include the account 
origin code[,]. [as set forth in Commentary .02 below. This reporting 
card or ticket shall immediately be time-stamped at the station where 
option contracts of the class involved are traded and attached to the 
appropriate ``buy'' ticket. The card or ticket shall then be placed in 
the price reporting card box provided at the station. Before placing 
the tickets in the box, the OTP Holder shall use his best efforts to 
make sure that the Order Book Official with respect to option contracts 
of the class involved, or the Order Book Official clerk, is aware of 
the transaction and its price. In transactions when the buyer accepts 
tickets from the seller(s), it shall be the buyer's responsibility to 
time-stamp the tickets, use best efforts at securing the Order Book 
Staff's attention to the transaction, and submit the tickets into the 
box.] Any OTP Holder failing to immediately report a transaction in 
accordance with Rule 6.69 will [shall] be subject to [being fined] 
disciplinary action pursuant to Rule 10. [by the Exchange.]
    .02--Reserved.
    [.02 Reporting of Trade Information. The responsibility for time 
stamping and reporting of trades to the Order Book is as follows: (a) 
One buyer, multiple sellers--responsibility is with the buyer
    (b) One seller, multiple buyers--responsibility is with the 
seller(c) one buyer, one seller--responsibility is with the seller]
    .03 Origin Codes for Orders Excepted from EOC or the Electronic 
Tablet Pursuant to Rule 6.67(d)(1)(A). For purposes of Rule 6.69(d), 
trade information includes the proper account origin codes, which are 
as follows: ``C'' for non-broker-dealer customer accounts; ``F'' for 
firm proprietary accounts; ``M'' for Market Maker accounts; and ``B/D'' 
for firm orders of non-OTP Holder or OTP Firm broker-dealer accounts, 
stock specialist accounts, or customer account trades of the broker-
dealer or non-OTP Holder or OTP Firm broker-dealer. In addition, Market 
Maker clearing firms are directed to instruct their respective trading 
desks to identify Market Maker orders that are entered from off the 
floor and not entitled to Market Maker margin treatment by placing a 
``C'' after the Market Maker's number in the ``firm'' box on the 
ticket. Floor Brokers, when accepting an order by phone from a Market 
Maker, are similarly directed to identify that order in the same 
manner.
    .04--No change.
* * * * *

Priority and Order Allocation Procedures

    Rule 6.75(a)-(h)--No change.
    Commentary:
    .01-.03--No change.
    .04 Combination, Spread and Straddle Orders. Following are the 
proper trading procedures for combination, spread and straddle orders:
    (a) Announcing the Order. Any OTP Holder or OTP Firm holding a 
combination, spread, or straddle order must [write it on one ticket and 
must] bid or offer for each series in the order. For orders expected 
from EOC or the Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), such 
orders must be written on a ticket in accordance with Rule 
6.2(h)(5)(C). The OTP Holder or OTP Firm may express the order as it 
applies to each separate series or may express the order at its total 
or net debit/credit alone, so long as it is clear that the OTP Holder 
or OTP Firm is attempting to execute both series as a combination, 
spread, or straddle. The executing OTP Holder or OTP Firm must ensure 
that the trading crowd is aware of the request for a market and has an 
opportunity to participate in the transaction.
    (b)-(g)--No change.
* * * * *

Joint Accounts

    Rule 6.84(a)-(h)--No change.
    Commentary:
    .01-.02--No change.
    .03 Transactions on the Floor will be presumed to be for the 
proprietary account of the individual OTP Holder or OTP Firm unless the 
executing OTP Holder or OTP Firm enters the joint account symbol into 
EOC or the Electronic Tablet. For orders excepted from EOC or the 
Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), transactions on the 
Floor will be presumed to be for the proprietary account of the 
individual OTP Holder or OTP Firm unless the joint account symbol is 
given up and used on the trade ticket to represent the joint account as 
the executing OTP Holder or OTP Firm.
    .04 Any order of a joint account participant[,] that [which] is 
executed by a Floor Broker, must [shall] be in accordance with the 
procedures set forth in Rule 6.85, except that the joint account 
trading number with its alpha identification must be entered into EOC 
or the Electronic Tablet, or, for order excepted from EOC or the 
Electronic Tablet, pursuant to Rule 6.67(d)(1)(A), the joint account 
trading number with its alpha identification must [should] appear in 
the ``executing firm'' area. Additionally, a joint account may not bid, 
offer, purchase, sell, or enter orders in an option series in which a 
Floor Broker holds an order on behalf of the joint account or for the 
proprietary account of another participant in the joint account. Orders 
of joint account participants in a particular option series may not be 
concurrently represented[,] by one or more Floor Brokers.
    .05-.07--No change.
* * * * *

Market Maker Orders Executed By Floor Brokers

    Rule 6.85(a)-(c)--No change.
    Commentary:
    .01-.02--No change.
    .03 Orders Excepted from EOC or the Electronic Tablet Pursuant to 
Rule 6.67(d)(1)(A). Market Maker order

[[Page 76813]]

tickets should be prepared by the Market Maker, when possible. All 
orders must [shall] be recorded and time-stamped, pursuant to Rule 
6.67. Order tickets must [shall] include the acronym of the Market 
Maker entering the order in the area marked ``buying firm/selling 
firm,'' within the Market Maker's name printed at the bottom of the 
ticket. Order tickets must be marked to indicate whether the order is 
``GTC'' or day only. The acronym of the executing Floor Broker must 
[shall] be written in the are marked ``executing member.'' When 
utilizing a ``partial order'' ticket to facilitate the completion of an 
order, the control number of the original order ticket must be written 
on the partial order ticket. Except as provided in Rule 
6.2(h)(5)[(4)](C) (Ticket to Follow Rule), when a Floor Broker receives 
a verbal order from a Market Maker, or when a Floor Broker is requested 
by a Market Maker to alter an order in his possession in any way, the 
Floor Broker must [shall] immediately prepare an order ticket from 
outside the trading crowd and timestamp it.
* * * * *

Floor Broker Hand-held Terminals

    Rule 6.89(a)--No change.
    (b) Proprietary Brokerage Order Routing Terminals:
    (1)-(3)--No change.
    (4)(A)--No change.
    (B) Orders Excepted from EOC or the Electronic Tablet Pursuant to 
Rule 6.67(d)(1)(A). When an OTP Holder or OTP Firm executes an order 
that was received over a Terminal, the OTP Holder or OTP Firm must fill 
out and immediately time stamp a trading ticket [within one minute of 
the execution]. Exchange rules on record keeping and trade reporting 
are unchanged.
    (C)-(D)--No change.
    (5)-(7)--No change.

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 Exchange 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 Section s 
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

1. Purpose
    a. Background. The Exchange is proposing this rule change to comply 
with the requirement to implement COATS. In connection with the filing 
of this proposed rule change, the PCX withdraws SR-PCX-2002-57, and 
Amendment Nos. 1-4 thereto, which the Exchange previously filed to 
comply with the requirement to implement COATS.\3\
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release No. 48264 (July 31, 
2003), 68 FR 47124 (August 7, 2003) (SR-PCX-2002-57).
---------------------------------------------------------------------------

    Specifically, the Exchange is proposing to effect rule changes to 
support the implementation of its new audit trail system known as 
Electronic Order Capture System (``EOC''). The EOC is intended to 
fulfill one of the undertakings contained in the Commission's Order 
Instituting Public Administrative Proceedings Pursuant to Sections 
19(h)(1) of the Securities Exchange Act of 1934, Making Findings and 
Imposing Remedial Sanctions. (``Order'').\4\ Specifically, this rule 
filing is intended to respond to Section IV.B.e(v) of the Order, which 
requires, among other things, that the PCX incorporate into its audit 
trail all non-electronic orders such that the audit trail provides an 
accurate, time-sequenced record of electronic and other orders, 
quotations and transactions, beginning with the receipt of the order 
and documenting the life of the order through the process of execution, 
partial execution, or cancellation.\5\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 43268 (September 11, 
2000) and Administrative Proceeding File No. 3-10282.
    \5\ Id. at 13-14.
---------------------------------------------------------------------------

    Currently, the PCX operates two electronic order routing and 
execution system called Pacific Options Exchange Trading System 
(``POETS'') \6\ and PCX Plus,\7\ and other peripheral systems including 
the Pacific Options Processing System (``POPS'') \8\ and the Floor 
Broker Hand Held trading system,\9\ in conjunction with traditional 
open outcry trading with Floor Brokers and competing Market Makers. The 
Exchange's Member Firm Interface (``MFI'') enables OTP Holders and OTP 
Firms to send orders electronically to the Exchange for delivery to 
POETS, PCX Plus, a Floor Broker Hand Held Terminal, or to an OTP Holder 
or OTP Firm's default destination.\10\ While all executions using 
POETS, PCX Plus, and electronic hand-held devices carry immediately 
assigned system times, orders that are routed to the trading floor of 
the Exchange by telephone or sent to the OTP Holder or OTP Firm's 
printers located on the trading floor generally require manual trade 
ticket processing. Under the proposal, the EOC will eliminate the 
manual processing of order tickets and will further facilitate the 
creation and development of a comprehensive audit trail and automated 
surveillance systems for these orders that are currently processed 
manually.
---------------------------------------------------------------------------

    \6\ POETS is the Exchange's automated trading system comprised 
of an options order routing system, an automatic execution system 
(``Auto-Ex''), an on-line limit order book system (``Auto-Book''), 
and an automatic market quote update system (``Auto-Quote'').
    \7\ See Securities Exchange Act Release No. 47838 (May 13, 
2003), 68 FR 27129 (May 19, 2003) (Order approving PCX Plus).
    \8\ POPS is the Exchange's automated system that compares trade 
information entered by OTP Holders and Firms and submits trades to 
the Options Clearing Corporation for clearance and settlement.
    \9\ The Floor Broker Hand Held interface is an automated order 
delivery system that enables Floor Brokers to receive and execute 
orders electronically, and to report trade executions to the tape 
via the Options Price Reporting Authority (``OPRA'') and to POPS for 
clearing. See PCX Rule 6.89.
    \10\ An OTP Holder or OTT Firm's default destination may be 
either a particular firm booth or a remote entry site, to which 
orders that fail to meet the eligibility criteria necessary for 
Auto-Ex or Auto-Book will be delivered.
---------------------------------------------------------------------------

    b. Summary of Proposed Rule Changes. The Exchange is proposing to 
adopt changes to its rules regarding the record of orders (principally 
PCX Rules 6.67 and 6.68) to enhance the Exchange's audit trail and 
self-regulatory capabilities. The proposed changes to the text of the 
PCX rules are summarized below.
    1. EOC/Electronic Tablet. The Exchange is proposing to adopt new 
PCX Rule 6.67(c),\11\ which requires that every OTP holder or OTP Firm 
that receives an order for execution of the Exchange must immediately 
\12\ record the details of the order (including any modification of the 
terms of the order or cancellation of the order) into EOC, unless such 
order has been entered into the Exchange's other electronic order 
processing facilities \13\ (e.g., orders sent

[[Page 76814]]

electronically through the Exchange's MFI).\14\ OTP Holders and OTP 
Firms will have two ways to record the details of an order into EOC 
prior to representation in the trading crowd: (i) Direct entry into the 
EOC system, or (ii) entry to an Electronic Tablet that enables the user 
to hand-write the order information onto the tablet, which converts the 
information into an electronic format. The information from the 
Electronic Tablet is then transmitted to a Floor Broker's workstation 
for representation with an automatic timestamp for order receipt. A 
booth clerk will then key in the order information from the Electronic 
Tablet into the EOC system for clearing purposes in order for it to 
become part of the data required for COATS.
---------------------------------------------------------------------------

    \11\ Former Rules 6.67(b), (c) and (d) are being deleted as they 
are redundant and superfluous provisions pursuant to proposed Rules 
6.67(c), 6.67(d) and 6.67(d)(1).
    \12\ The Exchange commits that it will implement proactive and 
effective surveillance procedures for violations of Exchange rules 
and federal securities laws, including, but not limited to, rules 
prohibiting trading ahead and front running, related to the entry of 
customer orders into the EOC system.
    \13\ The EOC entry requirement will also apply to PCX Plus.
    \14\ The systemic entry requirement would not be applicable to 
transactions initiated on the Floor and executed by a registered 
Market Maker or a Lead Market Maker for their own account, as such 
trades that may be initiated on the Floor and that they are already 
reported to POETS via proprietary hand-held devices.
---------------------------------------------------------------------------

    The details of each order that will be required to be recorded upon 
receipt if directly entered into the EOC system include the 
following:\15\ (1) CMTA information/Clearing OTP Holder or Firm; (2) 
Option symbol, expiration month, exercise price, and type of option 
(call or put); (3) Side of market (buy or sell); (4) Quantity of option 
contracts; (5) Any limit price, stop price, or special conditions, (6) 
Opening or closing transaction; (7) Time in force; (8) Account origin 
code; and (9) Solicited or unsolicited.\16\
---------------------------------------------------------------------------

    \15\ The Exchange notes that certain data elements tied to 
execution, such as executing broker, contra broker, execution time 
and price are not required to be entered by this Rule, as they are 
not available at the time that order details are entered into EOC. 
The Exchange also notes that the order entry time and identification 
number are automatically assigned upon entry into EOC.
    \16\ The proposed rule also includes a provision that would 
require OTP Holders and OTP Firms to record such other information 
as may be required by the Exchange from time to time.
---------------------------------------------------------------------------

    The details of each order that will be required to be recorded upon 
receipt if entered into the Electronic Tablet include the following: 
(1) CMTA information/Clearing OTP Holder or Firm; (2) Option symbol, 
expiration month, exercise price, and type of option (call or put); (3) 
Side of market (buy or sell); (4) Quantity of option contracts; (5) Any 
limit kprice, stop price, or special conditions, and (6) Opening or 
closing transaction.
    Therefore, OTP Holders and OTP Firms may comply with proposed PCX 
Rule 6.67(c) in one of three ways: (1) Required order details may be 
transmitted via the Exchange's other electronic order processing 
facilities that electronically assign the time of receipt on the 
Exchange; (2) Order details may be routed to the OTP Holder or OTP Firm 
booth by telephone or be sent to the OTP Holder or OTP Firm's printer 
located on the Floor, and immediately entered into EOC (either directly 
into EOC or via the Electronic Tablet), which will electronically 
assign the time of receipt of the Exchange; or (3) Orders may be 
received during outgoing telephone calls that are initiated at the 
option post, and then immediately entered into the EOC (either directly 
into EOC or via the electronic Tablet), which will electronically 
assign the time of receipt of the Exchange pursuant to PCX Rule 
6.2(h)(3)(B).\17\
---------------------------------------------------------------------------

    \17\ The Exchange's order processing systems have been designed 
so that the clocking mechanisms do not deviate by more than three 
seconds from the Naval Observatory atomic clock in Washington, DC.
---------------------------------------------------------------------------

    The EOC device that is used to record the details of the order upon 
receipt on the Floor is an Exchange provided system.\18\ The EOC and 
the enhancements to the existing Floor Broker Hand Held Terminal 
applications will support the entry of all order types (including 
contingency and complex orders, i.e., multiple-leg option and stock/
option orders) and all required information, as well as provide quick 
entry templates to speed data entry. Once an OTP Holder or OTP Firm's 
booth clerk records the details of an order into EOC (or the Electronic 
Tablet) or in the case when a Floor Broker receives an order pursuant 
to PCX Rule 6.2(h)(3)(B), the order is routed electronically to a Floor 
Broker Hand Held Terminal for representation in the trading crowd.\19\ 
OTP Holders and OTP Firms will have the capability to track and display 
all orders that are submitted through the EOC, as all orders will be 
assigned a unique identifier that will be used throughout the life of 
the order.
---------------------------------------------------------------------------

    \18\ The EOC will not initially support the use of a OTP Holder 
or OTP Firm's proprietary system to comply with the proposed order 
entry requirements.
    \19\ Orders sent via the EOC interface to a Floor Broker in the 
trading crowd may subsequently be transmitted electronically to 
another Floor Broker on the Floor. When an order is transmitted from 
one OTP Holder or OTP Firm to another, the EOC will capture each 
phase of processing at the order moves from entry to execution.
---------------------------------------------------------------------------

    The Exchange believes that the implementation of EOC and the 
Electronic Tablet, as described above, will improve order information 
management features resulting in operational efficienies for OTP 
Holders and OTP Firms.
    2. Order Format Requirements. The Exchange's current rules 
governing the order format requirements in transmitting orders to the 
Exchange are set forth in PCX Rule 6.67(a). The Exchange is proposing 
to add interpretive language to make it clear that EOC and the 
Electronic Tablet are approved formats for transmitting orders for 
purposes of this Rule. In addition, proposed PCX Rule 6.67(b) requires 
that orders sent to the Exchange for execution must comply with the 
order format requirements established by the Exchange relating to, 
among other things, option symbol, expiration month, exercise price, 
type of option (call or put); quantity of option contracts, clearing 
member organization, whether the order is to buy or sell, and whether 
the order is market or limit.
    3. Exceptions to EOC Entry Requirement. An exception to the 
requirement for recording order information into EOC or the Electronic 
Tablet is contained in proposed PCX Rule 6.67(d). Under this proposed 
rule, if a disruption or malfunction to EOC or the Electronic Tablet or 
any other Exchange electronic order processing system occurs, the EOC 
or the Electronic Tablet entry reuqirement will be suspended upon the 
approval of two Trading Officials, and the EOC/Electronic Tablet 
Contingency Reporting Procedures will be in effect pursuant to PCX Rule 
6.67(d)(1)(A).\20\ If the Exchange is still able to process and 
disseminate quotes accurately, then any orders received by the Exchange 
will be processed manually through the use of paper tickets. In such 
circumstances, all other Exchange rules governing options trading will 
remain in effect. Accordingly, the Exchange intends to retain its 
existing rules that are applicable to the manual processing of order 
tickets. Minor changes have been made throughout the existing options 
trading rules to allow for manual processing of trade tickets when 
necessary.
---------------------------------------------------------------------------

    \20\ Under the proposed rule, OTP Holders and OTP Firms must use 
a backup supply of tickets to record the details of the order 
received through non-electronic means and time stamp the order of 
events. Once the disruption or malfunction has been corrected, as 
determined by one Floor Official, OTP Holders and OTP Firms must 
input all orders into the EOC device using the ``as-of'' field.
---------------------------------------------------------------------------

    4. Record of Orders. Current PCX Rule 6.68(a) requires OTP Holder 
and OTP Firms to maintain and preserve certain information items 
relating to the terms of each option order. The Exchange is proposing 
to make minor technical changes to the text by renaming and renumbering 
certain information items enumerated in the Rule for clarity. The 
Exchange is also proposing language to specify that the Exchange shall 
maintain

[[Page 76815]]

and preserve all electronic orders on behalf of OTP Holders and OTP 
Firms. The proposed rule change does not replace existing requirements 
for recording orders contained in this Rule.
    The Exchange is also proposing to amend PCX Rule 6.68(b) to make it 
clear that OTP Holders and OTP Firms must comply with their record 
keeping obligations for order excepted from the EOC/Electronic Tablet 
requirements.
    5. Reporting of Trade Information. The Exchange proposes to rescind 
current PCX Rule 6.69, Commentary .02, which relates to the trade 
reporting requirements of OTP Holders and OTP Firms. The Exchange 
believes that this rule is superfluous and that it is inconsistent with 
PCX Rule 6.69(b), which already requires that the OTP Holder or OTP 
Firm representing the sell side of a transaction is responsible for 
reporting the transaction to the Exchange in a form and manner 
presecribed by the Exchange. Therefore, because current PCX Rule 
6.69(b) accurately reflects the PCX's existing trade reporting 
requirements, the Exchange is proposing to eliminate Commentary .02 of 
this rule for clarity.
    Proposed new PCX Rule 6.69, Commentary .03 specifies the reporting 
procedures for orders that are manually processed when there is a 
disruption or malfunction with the EOC pursuant to proposed new PCX 
Rule 6.67(d)(A)(1). This proposed new rule was adopted from current PCX 
Rule 6.67, Commentary .01.
    6. Cabinet Trades and FLEX Options. The Exchange also proposes to 
add a Commentary .01 to PCX Rule 6.67, which states that Cabinet Trades 
\21\ and FLEX\22\ options are exempt from the EOC and Electronic Tablet 
Entry Requirements as set forth in PCX Rule 6.67(c). However, such 
trades will be processed using manual time stamped order tickets. The 
PCX will maintain a separate record of quotes, orders and transactions 
related to such trades in the same format as the COATS data and will 
make such information available upon Commission request.
---------------------------------------------------------------------------

    \21\ See PCX Rule 6.80.
    \22\ See PCX Rule 5.30(b)(4).
---------------------------------------------------------------------------

    7. Implementation Date. The system entry requirement proposed in 
this rule change will become completely operative on January 10, 
2005.\23\
---------------------------------------------------------------------------

    \23\ See proposed PCX Rule 6.67(f).
---------------------------------------------------------------------------

    8. Miscellaneous Changes. The Exchanges proposes to make several 
minor, non-substantive changes to the text of several existing PCX 
Rules to correct stylistic, grammatical and typographical errors and to 
conform the proposed rules to the new EOC and Electronic Table 
requirements.
2. Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) \24\ of the Act, in general, and further the 
objectives of Section 6(b)(5),\25\ 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. In addition, the Exchange believes that the proposed 
rule change is consistent with provisions of Section 11A(a)(1(B) of the 
Act,\26\ which states that new data processing and communications 
techniques create the opportunity for more efficient and effective 
market operations.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78f(b).
    \25\ 15 U.S.C. 78f(b)(5).
    \26\ 15 U.S.C. 78k-1(a)(i)(B).
---------------------------------------------------------------------------

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

    Written comments on the proposed rule change were neither solicited 
nor received.

III. 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.

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

    <bullet> Use the Commission's Internet comment from (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#c5b7b0a9a0b6e8a6aaa8a8a0abb1b685b6a0a6eba2aab3"><span class="__cf_email__" data-cfemail="ff8d8a939a8cd29c9092929a918b8cbf8c9a9cd1989089">[email protected]</span></a>. Please include 
File No. SR-PCX-2004-122 on the subject line.

Paper Comments

    <bullet> Send paper comments in triplicate to Jonathon G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File No. SR-PCS-2004-122. 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 inspection and 
copying in the Commission's Public Reference Room, 450 Fifth Street, 
NW., Washington, DC 20549. Copies of such filing will also be available 
for inspection and copying at the principal office of the PCX. 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-PCX-2004-122 and should be 
submitted on or before January 6, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\27\
---------------------------------------------------------------------------

    \27\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Lynn Taylor,
Assistant Secretary.
[FR Doc. 04-27941 Filed 12-21-04; 8:45 am]
BILLING CODE 8010-01-M


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