Federal Register / Vol. 74, No. 194 / Thursday, October 8, 2009 / Notices 51917 

11 15 U.S.C. 78s(b)(3)(A). 

12 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

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

the Commission written notice of its intent to file 

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 satisfied this 

requirement. 

13 17 CFR 240.19b–4(f)(6). 

14 17 CFR 240.19b–4(f)(6). 

15For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposal’s impact on efficiency, competition, and 

capital formation. 15 U.S.C. 78c(f). 

16See Securities Exchange Act Release No. 60706 

(September 22, 2009) 74 FR 49416 (September 28, 

2009) (NYSEArca–2009–36). 17 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 17 CFR 240.19b–4(f)(6). 

19(b)(3)(A) of the Act 11 and Rule 19b– 

4(f)(6) thereunder.12

A proposed rule change filed 

pursuant to Rule 19b–4(f)(6) under the 

Act 13 normally does not become 

operative for 30 days after the date of its 

filing. However, Rule 19b–4(f)(6) 14

permits the Commission to designate a 

shorter time if such action is consistent 

with the protection of investors and the 

public interest. The Exchange requests 

that the Commission waive the 30-day 

operative delay so that it may 

implement the new rule on October 5, 

2009, the same date as the other equities 

exchanges. The Commission believes 

that waiving the 30-day operative delay 

is consistent with the protection of 

investors and the public interest 

because it will allow the Exchange to 

begin applying the new rule on the same 

date as the other equities exchanges.15

Application of the new rule on this date 

should help foster transparency and 

consistency among those exchanges that 

adopt clearly erroneous execution rules 

substantially similar to those previously 

approved by the Commission.16 For 

these reasons, the Commission 

designates that the proposed rule 

change become operative on October 5, 

2009. 

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–CBOE–2009–071 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–CBOE–2009–071. 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 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–CBOE–2009–071 and 

should be submitted on or before 

October 29, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–24248 Filed 10–7–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60759; File No. SR–BATS– 

2009–030] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend BATS Rule 

11.17, Entitled ‘‘Clearly Erroneous 

Executions’’ 

October 1, 2009. 

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 

September 28, 2009, BATS Exchange, 

Inc. (‘‘Exchange’’ or ‘‘BATS’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been prepared by the Exchange. BATS 

has designated the proposed rule change 

as constituting a rule change under Rule 

19b–4(f)(6) under the Act,3 which 

renders the proposal effective upon 

filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange is proposing to amend 

BATS Rule 11.17, entitled ‘‘Clearly 

Erroneous Executions,’’ to modify the 

Exchange’s rule regarding clearly 

erroneous executions. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.batstrading.com, at the 

principal office of the Exchange, 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 

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 

Exchange has prepared summaries, set 

forth in Sections A, B, and C below, of 

the most significant parts of such 

statements. 

mstockstill on DSKH9S0YB1PROD with NOTICES

51918 Federal Register / Vol. 74, No. 194 / Thursday, October 8, 2009 / Notices 

4For purposes of this Rule, ‘‘removed from the 

Consolidate Tape’’ means that a subsequent 

message will be sent to the Consolidated Tape 

indicating that a previously executed trade has been 

cancelled. 

5BATS Rule 1.5(n) defines a Member as ‘‘any 

registered broker or dealer that has been admitted 

to membership in the Exchange.’’ 

6BATS Rule 11.17(b). 

7Regular Trading Hours last from 9:30 a.m. until 

4:00 p.m. (Eastern Time). BATS Rule 1.5(w). 

8The Pre-Opening Session begins at 8:00 a.m. and 

concludes 9:30 a.m. (Eastern Time). BATS Rule 

1.5(r). 

9The After Hours Trading Session begins at 4:00 

p.m. and concludes at 5:00 p.m. (Eastern Time). 

BATS Rule 1.5(c). 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

BATS Rule 11.17 in order to modify the 

Exchange’s rule regarding clearly 

erroneous executions. The proposed 

changes are part of a market-wide effort 

designed to provide transparency and 

finality with respect to clearly erroneous 

executions. This effort seeks to achieve 

consistent results for participants across 

U.S. equities exchanges while 

maintaining a fair and orderly market, 

protecting investors and protecting the 

public interest. The proposed changes 

are more fully discussed below. 

Definition 

The Exchange will maintain the 

meaning of the definition of a clearly 

erroneous execution, but proposes to 

add clarifying language with respect to 

cancelled trades. The proposed change 

identifies that a transaction made in 

clearly erroneous error and agreed to be 

canceled by both parties or determined 

by the Exchange to be clearly erroneous 

will be removed ‘‘from the Consolidated 

Tape.’’ 4 A trade will only be removed 

from the Consolidated Tape when the 

determination is deemed final and any 

applicable appeals have been exhausted. 

Member Initiated Review Requests 

The Exchange proposes to amend 

BATS Rule 11.17 to update the 

procedures for requesting a review of a 

clearly erroneous transaction. The 

Exchange currently requires requests for 

review of a clearly erroneous execution 

to be made both by electronic mail 

(‘‘e-mail’’) and telephone. The proposed 

amended rule would require that 

requests for review be made by e-mail 

or ‘‘other electronic means specified 

from time to time by the Exchange.’’ 

Requiring requests for review to be 

made via e-mail creates a standard 

format that can easily be logged and 

tracked. Due to the evolution of 

electronic systems, however, it is 

possible that the Exchange will develop 

a more efficient means of electronic 

submission, and thus, has proposed 

language with a broader scope. The 

Exchange will publish the e-mail 

address or other electronic means to be 

used for all clearly erroneous filings in 

a circular distributed to Members.5

In order to be consistent with the 

clearly erroneous execution rules of 

other exchanges, the language of the 

proposed rule slightly differs from the 

current rule with respect to the 

information that must be included with 

a request for review. The only 

substantive difference between the 

current rule and proposed rule in this 

regard, however, is that the Exchange 

will no longer request that a Member 

indicate a requested resolution of the 

matter (i.e., break or adjust) and will 

require a Member to include the factual 

basis for the request. 

The proposed rule also requires the 

Exchange to notify the counterparty to 

a trade upon receipt of a timely filed 

request for review that satisfies the 

numerical guidelines set forth within 

the Rule (the ‘‘Numerical Guidelines’’). 

This proposed language eliminates the 

requirement that counterparties be 

notified of every request for a ruling and 

instead requires notice only when a 

request is filed in a timely manner and 

satisfies the Numerical Guidelines. This 

change alleviates the burden on the 

Exchange of notifying the counterparty 

when a request for review does not 

merit a ruling. 

The Exchange proposes to amend 

BATS Rule 11.17 to allow an Officer of 

the Exchange or such other employee 

designee (‘‘Officer’’) of the Exchange to 

request additional information from 

each party to a transaction under 

review. Parties to the review will have 

30 minutes from the time of the request 

to provide additional supporting 

information. 

Routed Executions 

The Exchange proposes to give other 

market centers an additional thirty (30) 

minutes from the receipt of their 

participant’s timely filing to request a 

ruling, but no longer than sixty (60) 

minutes from the time of the execution 

under review. This provision accounts 

for those executions initially directed to 

an away market center and subsequently 

routed by that away market center to the 

Exchange. For example, assume an 

order is initially routed by a participant 

to Market Center A and subsequently 

routed to BATS where the order is 

executed at a price outside of the 

Numerical Guidelines. This provision 

generally requires Market Center A to 

file with the Exchange within 30 

minutes from the time it receives its 

participant’s timely filed request for 

review. This provision caps the filing 

deadline for an away market center at 60 

minutes from the time of the execution 

under review. 

Threshold Factors 

Currently, the Exchange’s Clearly 

Erroneous Execution rule does not 

identify specific numeric guidelines for 

determining what constitutes a clearly 

erroneous transaction. The current rule 

simply provides that an Exchange 

Official ‘‘shall review the transaction 

under dispute and determine whether it 

is clearly erroneous, with a view toward 

maintaining a fair and orderly market 

and the protection of investors and the 

public interest.’’ 6 The Exchange 

proposes adding certain numerical 

thresholds to the Rule that explicitly 

state what constitutes a clearly 

erroneous execution. 

Numerical Guidelines 

The proposed numerical guidelines 

state that a transaction executed during 

Regular Trading Hours 7 or the PreOpening 8 and After Hours Trading 

Sessions 9 may be found to be clearly 

erroneous only if the price of the 

transaction to buy is greater, or less in 

the case of a sale, than the reference 

price by an amount that equals or 

exceeds the numerical guidelines for a 

particular transaction category. The 

execution time of the transaction under 

review determines whether the 

guidance threshold is Regular Trading 

Hours or Pre-Opening or After Hours 

Trading Sessions (which occur before 

and after the Regular Trading Hours). 

The Reference Price shall be equal to the 

Consolidated Last Sale immediately 

prior to the execution under review, 

unless unusual circumstances are 

present. The proposed guidelines for 

sales greater than $0.00 up to and 

including $25.00 are 10% for Regular 

Trading Hours and 20% for the PreOpening and After Hours Trading 

Sessions. The proposed guidelines for 

sales greater than $25.00 up to and 

including $50.00 are 5% for Regular 

Trading Hours and 10% for the PreOpening and After Hours Trading 

Sessions. The proposed guidelines for 

sales greater than $50.00 are 3% for 

Regular Trading Hours and 6% for the 

Pre-Opening and After Hours Trading 

Sessions. A filing involving five or more 

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Federal Register / Vol. 74, No. 194 / Thursday, October 8, 2009 / Notices 51919 

securities by the same Member will be 

aggregated into a single filing called a 

‘‘Multi-Stock Event.’’ In the case of a 

Multi-Stock Event, the proposed 

guidelines are 10% for Regular Trading 

Hours and 10% for the Pre-Opening and 

After Hours Trading Sessions. In the 

case of Leveraged ETF/ETN securities, 

the above guidelines are to be 

multiplied by the leverage multiplier of 

the security. Executions that do not 

meet or exceed the Numerical 

Guidelines will not be eligible for 

review under this section. The following 

chart summarizes the proposed 

Numerical Guidelines. 

Reference price 

Regular trading hours numerical guidelines 

(subject transaction’s % difference from the 

reference price): 

Pre-opening and after hours trading session 

numerical guidelines 

(subject transaction’s % difference from the 

reference price): 

Greater than $0.00 up to and including $25.00 10% .................................................................. 20%. 

Greater than $25.00 up to and including 

$50.00.

5% .................................................................... 10%. 

Greater than $50.00 .......................................... 3% .................................................................... 6%. 

Multi-Stock Event—Filings involving five or 

more securities by the same Member will be 

aggregated into a single filing.

10% .................................................................. 10%. 

Leveraged ETF/ETN securities ......................... Regular Trading Hours Numerical Guidelines 

multiplied by the leverage multiplier (i.e., 2×).

Regular Trading Hours Numerical Guidelines 

multiplied by the leverage multiplier (i.e., 

2×). 

Establishing Numerical Guidelines 

within the Rule brings regulatory 

transparency and consistency in the 

application of the rules of the Exchange. 

These Numerical Guidelines represent 

the general consensus approach and 

were developed based on the collective 

experiences of a market-wide group. 

The Exchange believes that the 

Thresholds established are fair and 

appropriate and apply evenly to all 

participants. 

Unusual Circumstances 

The Exchange further proposes that in 

Unusual Circumstances the Exchange 

may, in its discretion and with a view 

toward maintaining a fair and orderly 

market and the protection of investors 

and the public interest, use a Reference 

Price other than the consolidated last 

sale. Unusual Circumstances may 

include periods of extreme market 

volatility, sustained illiquidity, or 

widespread system issues. Other 

Reference Prices that the Exchange may 

use would include the consolidated 

inside price, the consolidated opening 

price, the consolidated prior close, or 

the consolidated last sale prior to a 

series of executions. 

The following example explains the 

use of a Reference Price equal to the 

consolidated last sale prior to a series of 

executions. 

ABC has a consolidated last sale of 

$10.00. During Regular Trading Hours 

Customer A enters a market order to buy 

10,000 shares, although it had intended 

a market order for 1,000 shares. The size 

of the order is such that the order 

sweeps the BATS Book, which reflects 

1,000 shares of liquidity offered at each 

of following prices. Executions occur, 

moving through the depth of Book, as 

follows: 

Trade #1—1,000 shares @ $10.00 (9,000 

remaining) 

Trade #2—1,000 shares @ $10.20 (8,000 

remaining) 

Trade #3—1,000 shares @ $10.40 (7,000 

remaining) 

Trade #4—1,000 shares @ $10.60 (6,000 

remaining) 

Trade #5—1,000 shares @ $10.80 (5,000 

remaining) 

Trade #6—1,000 shares @ $11.00 (4,000 

remaining) 

Trade #7—1,000 shares @ $11.20 (3,000 

remaining) 

Trade #8—1,000 shares @ $11.40 (2,000 

remaining) 

Trade #9—1,000 shares @ $11.60 (1,000 

remaining) 

Trade #10—1,000 shares @ $11.80 (complete) 

Thus, to be eligible for review, a 

transaction must be at a price that is at 

least 10% higher than the consolidated 

last sale prior to the series of executions. 

Customer A could request a ruling for 

trades #6 through #10, priced at $11.00 

and above, but trades #1 through #5 

would not be eligible for review. 

Under the proposed rule the Exchange 

may also use a higher numerical 

guideline if, after market participants 

have been alerted to erroneous activity, 

the price of the security returns toward 

its prior trading range but continues to 

trade beyond the price it would have 

normally been broken. 

Joint Market Rulings 

In the interest of achieving 

consistency across markets, the 

Exchange proposes that, in events that 

involve other markets, the Exchange 

would have the ability to use a different 

Reference Price and/or Numerical 

Guideline. In these instances the 

Reference Price would be determined 

based on a consensus among the 

Exchanges where the transactions 

occurred. Furthermore, when a ruling is 

made across markets, the Exchange may 

determine that the ruling is not eligible 

for appeal because immediate finality is 

necessary to maintain a fair and orderly 

market and to protect investors and the 

public interest. 

Additional Factors 

The proposed amendments to BATS 

Rule 11.17 also enumerate some 

additional factors that an Officer may 

consider when determining whether an 

execution is clearly erroneous. These 

factors include, but are not limited to, 

system malfunctions or disruptions, 

volume and volatility for the security, 

derivative securities products that 

correspond to greater than 100% in the 

direction of a tracking index, news 

released for the security, whether 

trading in the security was recently 

halted/resumed, whether the security is 

an initial public offering, whether the 

security was subject to a stock-split, 

reorganization, or other corporate 

action, overall market conditions, PreOpening or After Hours Trading Session 

executions, validity of the consolidated 

tapes trades and quotes, consideration 

of primary market indications, and 

executions inconsistent with the trading 

pattern in the stock. Each additional 

factor shall be considered with a view 

toward maintaining a fair and orderly 

market, the protection of investors and 

the public interest. 

Numerical Guidelines Applicable to 

Volatile Market Openings 

The proposed Rule would give the 

Exchange the ability to expand the 

Numerical Guidelines applicable to 

transactions occurring between 9:30 

a.m. and 10 a.m. based on the 

disseminated value of the S&P 500 

Futures at 9:15 a.m. When the S&P 

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51920 Federal Register / Vol. 74, No. 194 / Thursday, October 8, 2009 / Notices 

10 15 U.S.C. 78f(b). 

Futures are up or down from 3% up to 

but not including 5% at 9:15 a.m., the 

Numerical Guidelines are doubled. 

When the S&P Futures are up or down 

5% or greater at 9:15 a.m., the 

Numerical Guidelines are tripled. The 

Exchange believes that the S&P 500 

Futures contract is an appropriate and 

reliable barometer of market activity 

prior to the market opening due to its 

broad based market coverage and deep 

liquidity. Using the S&P 500 Futures 

disseminated value at 9:15 a.m. as the 

barometer of market activity, the 

Exchange is providing a transparent 

means of offering adjusted guidelines in 

times of volatile market activity. 

Outlier Transactions 

The proposed amendments to BATS 

Rule 11.17 provide that an Officer may 

consider requests for review received 

after 30 minutes, but not longer than 60 

minutes after the execution in question 

in the case of an Outlier Transaction. An 

Outlier Transaction is a transaction 

where the execution price of the 

security is greater than three times the 

current Numerical Guidelines. In 

addition, if the execution price of the 

security breaches the 52-week high or 

low, then the Exchange may consider 

Additional Factors to determine if the 

transaction qualifies for review or if the 

Exchange shall decline to act. 

Review Procedures 

Initial Determination: The Exchange 

proposes removing language that 

currently allows an Officer to modify 

one or more of the terms of a transaction 

under review. Under the proposed rule, 

the Officer of the Exchange will only 

have the authority to break the trades or 

rule to let the trades stand. This change 

attempts to remove the subjectivity from 

the rule that is necessitated by an 

adjustment. The Exchange also proposes 

adding language stating that a 

determination shall be made generally 

within 30 minutes of receipt of the 

complaint, but in no case later than the 

start of Regular Trading Hours on the 

following trading day. Rulings made 

outside of 30 minutes by an Officer will 

not fail for lack of timeliness. The 

guideline simply provides participants 

an appropriate expectation that a ruling 

will generally be made within 30 

minutes, and in no case later than the 

start of Regular Trading Hours on the 

following trading day. 

Appeals: The Exchange proposes to 

amend the appeals procedure for trades 

that are deemed to be clearly erroneous. 

First, the Exchange will no longer 

accept appeal requests via facsimile. 

Similar to the proposed language for an 

initial request for a ruling, all appeal 

requests must be made via e-mail or 

other electronic means specified by the 

Exchange. 

The current rule provides that the 

Exchange shall review and render a 

decision upon an appeal within a 

timeframe prescribed by the Exchange. 

The proposed rule offers more definite 

guidelines to ensure the expedient 

resolution of appeals. It requires the 

Exchange to review appeals as soon as 

practicable, but generally on the same 

day as the executions under review. 

Appeals received between 3 Eastern 

Time and the close of trading of the 

After Hours Trading Session should be 

made as soon as practicable, but in no 

case later than the trading day following 

the date of the execution under review. 

Appeals will not fail for lack of 

timeliness. This revised provision 

provides participants a reasonable 

expectation of when a ruling on appeal 

will generally be made. 

Further, the proposed rule declares 

that any determination made by an 

Officer or by the CEE Panel shall be 

rendered without prejudice as to the 

right of the parties to the transaction to 

submit their dispute to arbitration. This 

provision simply clarifies the fact that 

nothing in the proposed rule limits or 

impedes the rights of the parties to 

arbitrate their dispute. 

System Disruption and Malfunctions 

Within the System Disruptions and 

Malfunctions section of current BATS 

Rule 11.17, after an Officer determines 

that a trade was clearly erroneous he 

may declare the transaction null and 

void or modify the trade to attempt to 

achieve an equitable rectification of the 

error. The proposed Rule eliminates the 

Exchange’s ability to modify a clearly 

erroneous execution. The Exchange 

must either uphold or nullify the 

execution based upon the findings of 

the Officer reviewing the execution. The 

proposed Rule provides that, in the 

event of a disruption or a malfunction, 

an Officer of the Corporation or other 

senior level employee designee will rely 

on the proposed Numerical Guidelines 

in determining whether an execution is 

clearly erroneous. However, the Officer 

or senior level employee may also use 

a lower Numerical Guideline if 

necessary to maintain a fair and orderly 

market, protect investors, and protect 

the public interest. The proposed rule 

also adds that actions taken under these 

circumstances must be taken within 30 

minutes of detection of the erroneous 

transaction in the ordinary case, and by 

no later than the start of Regular Trading 

Hours on the day following the date of 

the execution under review when 

extraordinary circumstances exist. 

Officers Acting on Their Own Motion 

The Exchange proposes to add a 

section to the Rule that will grant an 

Officer of the Exchange or other senior 

level employee designee the ability to 

act on his or her own motion to review 

potentially erroneous executions. Under 

the current rule, an Officer of the 

Exchange or other senior level employee 

designee has the ability to act upon his 

or her own motion only in the event of 

a system disruption or malfunction. The 

proposed rule would allow an Officer of 

the Corporation or other senior level 

employee designee to review executions 

and rely on the Numerical Guidelines, 

under any circumstance. In 

extraordinary circumstances an Officer 

or senior level employee designee may 

apply a lower Numerical Guideline if it 

is determined that such action is 

necessary to maintain a fair and orderly 

market or protect investors and the 

public interest. In some instances the 

Exchange may detect a single execution 

that breaches the Numerical Guidelines 

but is not the subject of a ruling request. 

This provision gives the Exchange the 

ability to review such executions. 

Additionally, in practice, clearly 

erroneous executions commonly involve 

multiple parties and multiple 

executions. In such instances, all 

affected parties may not request a 

ruling. The Exchange proposes this 

provision to permit an Officer of the 

Exchange or other senior level employee 

designee to rule on a group of 

transactions related to the same 

occurrence or event as a whole, without 

a formal request for a ruling from every 

affected party. 

As noted above, the proposed rule is 

the result of a market-wide effort to 

harmonize the clearly erroneous rules of 

U.S. equities exchanges so that market 

participants receive more uniform 

rulings regarding their executions on 

different exchanges. To best achieve 

such harmonization, the Exchange 

believes that the rules those national 

securities exchanges that are amending 

their rules should be amended as of the 

same date, and such implementation is 

currently planned for October 5, 2009. 

2. Statutory Basis 

The rule change proposed in this 

submission is consistent with the 

requirements of the Act and the rules 

and regulations thereunder that are 

applicable to a national securities 

exchange, and, in particular, with the 

requirements of Section 6(b) of the 

Act.10 Specifically, the proposed change 

is consistent with Section 6(b)(5) of the 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 74, No. 194 / Thursday, October 8, 2009 / Notices 51921 

11 15 U.S.C. 78f(b)(5). 

12 15 U.S.C. 78s(b)(3)(A). 

13 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

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

the Commission written notice of its intent to file 

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 satisfied this 

requirement. 

14 17 CFR 240.19b–4(f)(6). 

15 17 CFR 240.19b–4(f)(6). 

16For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposal’s impact on efficiency, competition, and 

capital formation. 15 U.S.C. 78c(f). 

17See Securities Exchange Act Release No. 60706 

(September 22, 2009) 74 FR 49416 (September 28, 

2009) (NYSEArca–2009–36). 

18 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

Act,11 because it would promote just 

and equitable principles of trade, 

remove impediments to, and perfect the 

mechanism of, a free and open market 

and a national market system. The 

proposed rule change provides 

transparency and finality for 

participants and creates consistent 

results across U.S. equities exchanges 

with respect to clearly erroneous 

executions. This proposed change 

further promotes the maintenance of a 

fair and orderly market, the protection 

of investors and the protection of the 

public interest. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change imposes any 

burden on competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has neither solicited 

nor received written comments on 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 12 and Rule 19b– 

4(f)(6) thereunder.13

A proposed rule change filed 

pursuant to Rule 19b–4(f)(6) under the 

Act 14 normally does not become 

operative for 30 days after the date of its 

filing. However, Rule 19b–4(f)(6) 15

permits the Commission to designate a 

shorter time if such action is consistent 

with the protection of investors and the 

public interest. The Exchange requests 

that the Commission waive the 30-day 

operative delay so that it may 

implement the new rule on October 5, 

2009, the same date as the other equities 

exchanges. The Commission believes 

that waiving the 30-day operative delay 

is consistent with the protection of 

investors and the public interest 

because it will allow the Exchange to 

begin applying the new rule on the same 

date as the other equities exchanges.16

Application of the new rule on this date 

should help foster transparency and 

consistency among those exchanges that 

adopt clearly erroneous execution rules 

substantially similar to those previously 

approved by the Commission.17 For 

these reasons, the Commission 

designates that the proposed rule 

change become operative on October 5, 

2009. 

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–BATS–2009–030 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–BATS–2009–030. 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 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–BATS–2009–030 and 

should be submitted on or before 

October 29, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–24247 Filed 10–7–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60782; File No. SR– 

NYSEAmex–2009–69] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NYSE 

Amex LLC Amending NYSE Amex 

Equities Rule 128 Governing Clearly 

Erroneous Executions for NYSE Amex 

Equities 

October 2, 2009. 

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 October 

2, 2009, NYSE Amex LLC (‘‘Exchange’’ 

or ‘‘NYSE Amex’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. NYSE Amex has 

designated the proposed rule change as 

constituting a rule change under Rule 

mstockstill on DSKH9S0YB1PROD with NOTICES