600 Federal Register / Vol. 76, No. 3 / Wednesday, January 5, 2011 / Notices 

14 15 U.S.C. 78s(b)(3)(A). 

15 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

provide the Commission with 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 fulfilled this requirement. 

16The text of the proposed rule change is 

available on the Commission’s Web site at http:// 

www.sec.gov. 

17 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

that the instant filing is consistent with 

these principles because the NMM Pilot 

provides its market participants with a 

trading venue that utilizes an enhanced 

market structure to encourage the 

addition of liquidity, facilitate the 

trading of larger orders more efficiently 

and operates to reward aggressive 

liquidity providers. Moreover, the 

instant filing requesting an extension of 

the NMM Pilot will permit adequate 

time for: (i) The Exchange to prepare 

and submit a filing to make the rules 

governing the NMM Pilot permanent; 

(ii) public notice and comment; and (iii) 

completion of the 19b–4 approval 

process. 

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: (1) Does not significantly affect 

the protection of investors or the public 

interest; (2) does not impose any 

significant burden on competition; and 

(3) by its terms does not become 

operative for 30 days after the date of 

this filing, 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 14 and 

Rule 19b–4(f)(6) thereunder.15

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 

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 rulecomments@sec.gov. Please include File 

Number SR–NYSEAmex-2010–122 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-2010–122. 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 website 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.16 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–2010–122 and should be 

submitted on or before January 26, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–33259 Filed 1–4–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63614; File No. SR–NYSE– 

2010–84] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Making 

Permanent NYSE Rule 123C(9)(a)(1) 

and Amending Rule 123C(9)(a)(1)(iii) 

December 29, 2010. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that on December 

20, 2010, New York Stock Exchange 

LLC (‘‘NYSE’’ 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 self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to make 

permanent NYSE Rule 123C(9)(a)(1), 

which currently operates on a pilot 

basis. The Exchange also proposes to 

amend Rule 123C(9)(a)(1)(iii) to 

eliminate the requirement that only 

Floor brokers can represent interest after 

4:00 p.m. The text of the proposed rule 

change is available at the Exchange, the 

Commission’s Public Reference Room, 

http://www.sec.gov, 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 


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4The Exchange notes that parallel changes are 

proposed to be made to the rules of NYSE Amex 

LLC. See SR–NYSEAmex–2010–121. 

5See Securities Exchange Act Release Nos. 59755 

(April 13, 2009), 74 FR 18009 (April 20, 2009) (SR– 

NYSE–2009–18) (order granting approval of the 

Pilot); 60809 (October 9, 2009), 74 FR 53532 

(October 19, 2009) (SR–NYSE–2009–104) 

(extending the operation of the Pilot to December 

31, 2009); 61264 (December 31, 2009), 75 FR 1107 

(January 8, 2010) (SR–NYSE–2009–131) (extending 

the operation of the Pilot from December 31, 2009 

to March 1, 2010); 61612 (March 1, 2010), 75 FR 

10543 (March 8, 2010) (SR–NYSE–2010–11) 

(extending the operation of the Pilot from March 1, 

2010 to June 1, 2010); 62231 (June 4, 2010), 75 FR 

33872 (June 15, 2010) (SR–NYSE–2010–42) 

(extending the operation of the Pilot from June 1, 

2010 to December 1, 2010); and SR–NYSE–2010–79 

(filed November 30, 2010) (extending the operation 

of the Pilot from December 1, 2010 to June 1, 2011). 

6 In addition, the Exchange proposes to make a 

technical change to the text of Rule 123C(9)(a)(1)(v). 

7See SR–NYSE–2010–79 (filed November 30, 

2010) (extending the operation of the Pilot from 

December 1, 2010 to June 1, 2011). 

8Prior to implementation of this rule change, the 

Exchange will issue guidance in the form of an 

Information Memo that member organizations 

entering interest will be responsible for complying 

with Rule 123C(9)(a)(1)(iii). 

9 15 U.S.C. 78f(b)(5). 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 

19b–4(f)(6)(iii) requires that a self-regulatory 

organization 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 filing of the proposed rule change, or 

such shorter time as designated by the Commission. 

The Exchange has satisfied this requirement. 

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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to make 

permanent NYSE Rule 123C(9)(a)(1),4

which has operated on a pilot basis and 

allows the Exchange to temporarily 

suspend certain rule requirements at the 

close when extreme order imbalances 

may cause significant dislocation to the 

closing price (‘‘Extreme Order 

Imbalances Pilot’’ or ‘‘Pilot’’).5 The Pilot 

has recently been extended to June 1, 

2011. In addition, in connection with 

proposing to make the rule permanent, 

the Exchange proposes to amend Rule 

123C(9)(a)(1)(iii) to eliminate the 

requirement that only Floor brokers can 

represent interest after 4:00 p.m. and to 

make technical amendments related to 

the obligations of member firms entering 

interest pursuant to Rule 123C(9)(a)(1).6

Background 

Pursuant to NYSE Rule 123C(9)(a)(1), 

the Exchange may suspend NYSE Rule 

52 (Hours of Operation) to resolve an 

extreme order imbalance that may result 

in a price dislocation at the close as a 

result of an order entered into Exchange 

systems, or represented to a Designated 

Market Maker (‘‘DMM’’) orally at or near 

the close. NYSE Rule 123C(9)(a)(1) was 

intended to be and has been invoked to 

attract offsetting interest in rare 

circumstances where there exists an 

extreme imbalance at the close such that 

a DMM is unable to close the security 

without significantly dislocating the 

price. 

As a condition of the approval to 

operate the Pilot, the Exchange 

committed to provide the Commission 

with information regarding: (i) How 

often an NYSE Rule 52 temporary 

suspension pursuant to the Pilot was 

invoked during the six months 

following its approval; and (ii) the 

Exchange’s determination as to how to 

proceed with technical modifications to 

reconfigure Exchange systems to accept 

orders electronically after 4 p.m. As the 

Exchange has previously noted in filings 

with the Commission, the Pilot has been 

invoked on only five occasions in 

NYSE-listed securities.7

Proposal To Make Permanent the 

Operation of the Extreme Order 

Imbalance Rule 

The Exchange has completed and 

tested the system modifications 

necessary to accept orders electronically 

after 4 p.m. The Exchange therefore 

proposes to make Rule 123C(9)(a)(1), as 

amended, permanent beginning on 

January 3, 2011. 

Because the Exchange can now accept 

orders electronically after 4 p.m., the 

Exchange proposes to amend Rule 

123C(9)(a)(iii) to eliminate the 

restriction that only Floor brokers can 

represent offsetting interest in response 

to a solicitation of interest pursuant to 

the Rule. The Exchange further proposes 

to make technical changes to Rule 

123C(9)(a)(1)(iii) to identify what 

interest may be entered in response to 

a solicitation, i.e., it must be offsetting 

interest, a limit order priced no worse 

than the last sale, and irrevocable. 

Market participants sending in interest 

electronically in response to a 

solicitation after 4 p.m. are responsible 

for assuring compliance with all 

provisions of subsection (iii), including 

that such interest must be on the 

opposite side of the imbalance, must be 

limit priced no worse than the last sale, 

and must be irrevocable. Failure to 

abide by these requirements could 

subject a market participant to 

regulatory review and possible 

disciplinary action.8

The Exchange also proposes to amend 

Rule 123C(9)(a)(iv) to make clear that all 

offsetting interest solicited pursuant to 

the Rule will be executed consistent 

with Rule 72(c), which governs the 

allocation of executions among market 

participants. 

2. Statutory Basis 

The basis under the Act for this 

proposed rule change is the requirement 

under Section 6(b)(5) 9 that an Exchange 

have rules that are 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. The Exchange believes 

that this filing is consistent with these 

principles because the proposed rule 

change will increase the ability of 

market participants to enter trading 

interest designed to prevent significant 

dislocation to closing prices that could 

result from extreme order imbalances. 

The Exchange further believes that this 

filing is consistent with these principles 

in that it expands the field of market 

participants that can directly enter 

interest in response to a solicitation of 

offsetting interest after 4 p.m. pursuant 

to Rule 123C(9)(a)(1). 

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, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 10 and Rule 19b– 

4(f)(6)(iii) thereunder.11 The Exchange 

has asked the Commission to waive the 

30-day operative delay so that the 


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602 Federal Register / Vol. 76, No. 3 / Wednesday, January 5, 2011 / Notices 

12For 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). 

13 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.15c3–1. 

proposal may become operative 

immediately upon filing. 

The Exchange reports in connection 

with this proposal to make permanent 

Rule 123C(9)(a)(1) that it has completed 

testing of a functionality that would 

enable the electronic submission of 

orders after 4 p.m., and thus now 

proposes to remove the requirement that 

all interest entered after 4 p.m. in 

response to a DMM’s solicitation of 

interest to offset an extreme order 

imbalance must be represented by Floor 

brokers. The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest 

because doing so would allow the 

benefits of the new systems 

modifications allowing all market 

participants to enter orders 

electronically (rather than solely 

through a Floor broker) during a Rule 

123C(9)(a)(1) suspended close to be 

realized immediately.12 Accordingly, 

the Commission waives the 30-day 

operative delay requirement and 

designates the proposed rule change 

operative upon filing with the 

Commission. 

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 

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 rulecomments@sec.gov. Please include File 

Number SR–NYSE–2010–84 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–NYSE–2010–84. 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 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 

publicly available. All submissions 

should refer to File Number SR–NYSE– 

2010–84 and should be submitted on or 

before January 26, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–33254 Filed 1–4–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63623; File No. SR–OCC– 

2010–19] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing of Proposed Rule Change 

Relating to Stock Loan Programs 

December 30, 2010. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 notice is hereby given that on 

December 16, 2010, The Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission the proposed rule change 

as described in Items I and II below, 

which Items have been prepared 

primarily by OCC. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The proposed rule change would 

provide OCC’s clearing members with 

clarification regarding the regulatory 

treatment under Rule 15c3–1 2 of 

collateral and margin posted by clearing 

members participating in stock loan 

transactions through OCC’s Stock Loan/ 

Hedge Program or Market Loan Program. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

OCC 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. OCC 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 

The purpose of the proposed rule 

change is to provide OCC’s clearing 

members with clarification regarding 

the regulatory treatment under Rule 

15c3–1 of collateral and margin posted 

by clearing members participating in 

stock loan transactions through OCC’s 

Stock Loan/Hedge Program or Market 

Loan Program. 

1. Background 

OCC’s Stock Loan/Hedge Program, 

provided for in Article XXI of OCC’s ByLaws and Chapter XXII of OCC’s Rules, 

provides a means for OCC clearing 

members to submit broker-to-broker 

stock loan transactions to OCC for 

clearance. Broker-to-broker transactions 

are independently-executed stock loan 

transactions that are negotiated directly 

between two OCC clearing members. 

OCC’s Market Loan Program, provided 

for in Article XXIA of OCC’s By-Laws 

and Chapter XXIIA of OCC’s Rules, 

accommodates securities loan 

transactions executed through electronic 

trading platforms that match lenders 

and borrowers on an anonymous basis. 


jlentini on DSKJ8SOYB1PROD with NOTICES