46816 Federal Register / Vol. 74, No. 175 / Friday, September 11, 2009 / Notices 

8 15 U.S.C. 78o–3(b)(6). 

9 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a et seq. 

3 17 CFR 240.19b–4. 

since the rule’s enactment, and (2) 

update the ‘‘subject market’’ language to 

make it consistent with the language 

used in the SEC’s Firm Quote Rule (Rule 

602 of Regulation NMS), specifically 

that, if at the time an order for the 

purchase or sale of the quoted security 

is presented the member is in the 

process of effecting a transaction and 

immediately after the completion of 

such transaction communicates a 

revised quotation size, such member 

shall not be obligated to purchase or sell 

the quoted security in an amount greater 

than such revised quotation size. 

FINRA will announce the 

implementation date of the proposed 

rule change in a Regulatory Notice to be 

published no later than 90 days 

following Commission approval. 

2. Statutory Basis 

FINRA believes that the proposed rule 

change is consistent with the provisions 

of Section 15A(b)(6) of the Act,8 which 

requires, among other things, that 

FINRA rules must be designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade and, in 

general, to protect investors and the 

public interest. FINRA believes that 

adopting the proposed rules as part of 

the Consolidated FINRA Rulebook will 

continue to enhance market quality by 

providing for increased reliability and 

usefulness of quotation information. 

FINRA notes that the proposed rules 

have been in operation for numerous 

decades and believes that they have 

since proven effective in achieving the 

statutory mandates. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA does not believe that the 

proposed rule change will result in 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 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 

• 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–FINRA–2009–055 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–FINRA–2009–055. 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, 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 FINRA. 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–FINRA– 

2009–055 and should be submitted on 

or before October 2, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–21883 Filed 9–10–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60614; File No. SR–NYSE– 

2009–90] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by New York 

Stock Exchange LLC To Modify 

Rebates Payable to Designated Market 

Makers 

September 2, 2009. 

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 August 

31, 2009, New York Stock Exchange 

LLC (‘‘NYSE’’ or ‘‘Exchange’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule changes as described in 

Items I, II and III below, which items 

have been prepared by the Exchange. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule changes from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend its 

schedule of rebates payable to 

Designated Market Makers (‘‘DMMs’’), 

with effect from September 1, 2009. The 

text of the proposed rule change is 

available on the Exchange’s Web site 

(http://www.nyse.com), at the 

Exchange’s Office of the Secretary, and 

at the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of 

and basis for the proposed rule change 

and discussed any comments it received 


cprice-sewell on DSKGBLS3C1PROD with NOTICES
Federal Register / Vol. 74, No. 175 / Friday, September 11, 2009 / Notices 46817 

4The Capital Commitment Schedule has been 

implemented since this language was included in 

the Price List and the language is now moot. 

5The following is an example of how the DMM 

Quoted Size will be calculated: 

• The numerator is calculated as follows: if the 

DMM quotes at the NBBO for an average of 1000 

shares for 60% of the time over the course of the 

month in stock ABC, then the numerator would be 

600 shares = (1000 shares × 60% of the time over 

the course of the month); 

• The denominator is calculated as follows: if the 

NYSE was at the NBBO for an average of 10,000 

shares for 70% of the time over the course of the 

month, then the NYSE Quoted Size is 7,000 shares 

= (10,000 shares × 70% of the time over the course 

of the month); 

• The DMM Quoted Size Ratio is 8.5% = 600/ 

7000. 

6When providing liquidity on market-at-the-close 

and limit-at-the-close transactions, DMMs will 

continue to receive a rebate of $0.0005 per share. 

Rebates do not apply to executions at the open. 

7 15 U.S.C. 78f. 

8 15 U.S.C. 78f(b)(4). 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The NYSE 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 

1. Purpose 

The Exchange proposes to revise its 

schedule of rebates paid to DMMs for 

providing liquidity on the Exchange, 

with effect from September 1, 2009. 

Currently, DMMs receive: 

• A rebate of $0.0030 per share when 

adding liquidity in round lots of active 

securities (i.e., securities with an 

average daily consolidated volume 

(‘‘ADV’’) in the previous month equal to 

or greater than 1,000,000 shares per 

month) (‘‘More Active Securities’’) if the 

More Active Security has a stock price 

of $1.00 or more; and 

• A rebate of $0.0035 per share when 

adding liquidity in round lots of 

securities that have an ADV of less than 

1,000,000 shares per month in the 

previous month (‘‘Less Active 

Securities’’) if the Less Active Security 

has a stock price of $1.00 or more. Each 

DMM also receives all of the market 

data quote revenue (the ‘‘Quoting 

Share’’) received by the Exchange from 

the Consolidated Tape Association 

under the Revenue Allocation Formula 

of Regulation NMS with respect to any 

Less Active Security (regardless of 

whether the stock price exceeds $1.00) 

in any month in which the DMM meets 

the quoting requirement of Rule 

104(a)(1)(A) for that specific security. 

DMMs are entitled to the foregoing 

rebates when (i) posting displayed and 

non-displayed orders on Display Book, 

including s-quote and s-quote reserve 

orders; (ii) when providing liquidity on 

non-displayed interest using the Capital 

Commitment Schedule; or, prior to the 

implementation of the Capital 

Commitment Schedule, using the 

following message activities: price 

improvement, size improvement (PRIN 

FILL), matching away market quotes; 4

(iii) when executing trades in the crowd 

and at Liquidity Replenishment Points; 

and (iv) when providing liquidity on 

market-at-the-close and limit-at-theclose transactions. Rebates do not apply 

to executions at the open. 

Commencing September 1, 2009, the 

schedule of rebates for DMMs described 

above will be replaced with a new 

schedule of rebates. Under the revised 

schedule of rebates, DMMs will receive: 

• A rebate of $0.0025 per share when 

adding liquidity in round lots of More 

Active Securities if the More Active 

Security has a stock price of $1.00 or 

more and the DMM quotes at the 

National Best Bid or Offer (‘‘NBBO’’) in 

the applicable security at least 10% of 

the time in the applicable month (‘‘More 

Active Securities Quoting 

Requirement’’); 

• A rebate of $0.0030 per share when 

adding liquidity in round lots of More 

Active Securities if the More Active 

Security has a stock price of $1.00 or 

more and the DMM meets both (i) the 

More Active Securities Quoting 

Requirement and (ii) the More Active 

Securities Quoted Size Ratio 

Requirement. A DMM will meet the 

‘‘More Active Securities Quoted Size 

Ratio Requirement’’ when the DMM 

Quoted Size Ratio for an applicable 

month is 15% of the NYSE Quoted Size. 

The ‘‘NYSE Quoted Size’’ will be 

calculated by multiplying the average 

number of shares quoted on the NYSE 

at the NBBO by the percentage of time 

the NYSE had a quote posted at the 

NBBO. The ‘‘DMM Quoted Size Ratio’’ 

will be calculated by multiplying the 

average number of shares of the 

applicable security quoted at the NBBO 

by the DMM by the percentage of time 

during which the DMM quoted at the 

NBBO; 5

• A rebate of $0.0015 per share when 

adding liquidity in round lots of More 

Active Securities if the More Active 

Security has a stock price of $1.00 or 

more and the DMM does not meet the 

More Active Securities Quoting 

Requirement in the applicable security 

in the applicable month; 

• A rebate of $0.0035 per share when 

adding liquidity in round lots of Less 

Active Securities, if the Less Active 

Security has a stock price of $1.00 or 

more and the DMM quotes at the NBBO 

in the applicable security at least 15% 

of the time in the applicable month (the 

‘‘Less Active Securities Quoting 

Requirement’’). Each DMM will also 

receive all of the Quoting Share the 

Exchange receives from the 

Consolidated Tape Association under 

the Revenue Allocation Formula of 

Regulation NMS with respect to any 

Less Active Security (regardless of 

whether the stock price exceeds $1.00) 

in any month in which the DMM meets 

the Less Active Securities Quoting 

Requirement for that specific security); 

and 

• A rebate of $0.0015 per share when 

adding liquidity in round lots of Less 

Active Securities if the Less Active 

Security has a stock price of $1.00 or 

more and the DMM does not meet the 

Less Active Securities Quoting 

Requirement in the applicable security 

in the applicable month. 

Rebates under the new rebate 

schedule will be applied when (i) 

posting displayed and non-displayed 

orders on Display Book, including squote and s-quote reserve orders; (ii) 

when providing liquidity on nondisplayed interest using the Capital 

Commitment Schedule, and (iii) when 

executing trades in the crowd and at 

Liquidity Replenishment Points.6

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the provisions of Section 6 7 of the Act 

in general and Section 6(b)(4) of the 

Act 8 in particular, in that it is designed 

to provide for the equitable allocation of 

reasonable dues, fees and other charges 

among its members and other persons 

using its facilities. The Exchange 

believes that the proposal does not 

constitute an inequitable allocation of 

dues, fees and other charges as 

providing credits to DMMs when they 

add liquidity to the market assists in the 

effective operation of the NYSE’s market 

model. The removal of the reference to 

the types of messages for which the 

associated executions qualified for 

rebates prior to the implementation of 

the Capital Commitment Schedule is not 

a substantive change as the Capital 

Commitment Schedule has been 

implemented. 

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 purpose of the Act. 


cprice-sewell on DSKGBLS3C1PROD with NOTICES
46818 Federal Register / Vol. 74, No. 175 / Friday, September 11, 2009 / Notices 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 240.19b–4(f)(2). 

11 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. 

4See Securities Exchange Act Release No. 34– 

58968 (November 17, 2008), 73 FR 64647 (SR– 

NYSEArca–2008–111). 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 9 of the Act and Rule 19b– 

4(f)(2) 10 thereunder. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–NYSE–2009–90 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–2009–90. 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 on official business days between 

the hours of 10 a.m. and 3 p.m. Copies 

of such filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–NYSE– 

2009–90 and should be submitted on or 

before October 2, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–21884 Filed 9–10–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60621; File No. SR– 

NYSEArca–2009–77] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing of Proposed 

Rule Change Amending NYSE Arca 

Options Rule 5.3(j) 

September 3, 2009. 

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 August 

19, 2009, NYSE Arca, Inc. (‘‘NYSE 

Arca’’ or the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) 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 

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 amend the 

definition of Futures-Linked Securities 

for the trading of options on IndexLinked Securities. The text of the 

proposed rule change is attached as 

Exhibit 5 to the 19b–4 form. A copy of 

this filing is available on the Exchange’s 

Web site at www.nyse.com, at the 

Exchange’s principal office and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

NYSE Arca Rules [sic] 5.3(j) 

designates the listing and trading of 

options on equity index-linked 

securities (‘‘Equity Index-Linked 

Securities’’), commodity-linked 

securities (‘‘Commodity-Linked 

Securities’’), currency-linked securities 

(‘‘Currency-Linked Securities’’), fixed 

income index-linked securities (‘‘Fixed 

Income Index-Linked Securities’’), 

futures-linked securities (‘‘FuturesLinked Securities’’) and multifactor 

index-linked securities (‘‘Multifactor 

Index-Linked Securities’’), collectively 

known as ‘‘Index-Linked Securities’’ (as 

defined in NYSE Arca Equities Rule 

5.2(j)(6)) that are principally traded on 

a national securities exchange and an 

‘‘NMS Stock’’ (as defined in Rule 600 of 

Regulation NMS under the Securities 

and Exchange Act of 1934). The 

Exchange proposes to amend the 

definition of Futures-Linked Securities 

for the trading of options on IndexLinked Securities to include products 

linked to CBOE Volatility Index (VIX) 

Futures. This proposal is substantially 

similar to the previously approved 

NYSE Arca Equities Rule 5.2(j)(6)(v).4

Specifically, the Exchange proposes to 

add the CBOE Volatility Index (VIX) 

Futures to the definition of a Futures 

Reference Asset in NYSE Arca Rule 

5.3(j)(1)(E). 

Index-Linked Securities are designed 

for investors who desire to participate in 

a specific market segment by providing 

exposure to one or more identifiable 


cprice-sewell on DSKGBLS3C1PROD with NOTICES