16838 Federal Register / Vol. 72, No. 65 / Thursday, April 5, 2007 / Notices 

3See Securities Exchange Act Release No. 54561 

(October 2, 2006), 71 FR 59844 (October 11, 2006). 

4See Securities Exchange Act Release No. 55427 

(March 8, 2007), 72 FR 12644 (March 16, 2007). 

5 15 U.S.C. 78f(b)(4). 

6 15 U.S.C. 78s(b)(3)(A)(ii). 

7 17 CFR 240.19b–4(f)(2). 8 17 CFR 200.30–3(a)(12). 

Exchange, LLC (‘‘ISE’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II and III below, which Items 

have been substantially prepared by the 

Exchange. 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 ISE is proposing to amend its 

Schedule of Fees to extend a fee waiver 

related to the ISE Stock Exchange (‘‘ISE 

Stock’’). The text of the proposed rule 

change is available at http:// 

www.iseoptions.com and 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 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 purpose of this proposed rule 

change is to extend a fee waiver related 

to the trading of equity securities on ISE 

Stock, a facility of the Exchange. The 

Exchange currently waives all execution 

fees in an effort to promote trading on 

ISE Stock.3 The fee waiver is scheduled 

to expire on April 1, 2007.4 In an effort 

to continue the promotion of ISE Stock, 

the Exchange proposes to extend the 

waiver of all execution fees until May 1, 

2007. 

2. Statutory Basis 

The basis under the Act for this 

proposed rule change is the requirement 

under Section 6(b)(4) 5 that the 

Exchange provide for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members and 

issuers and other persons using its 

facilities. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange believes that the 

proposed rule change does not 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 

The Exchange has not solicited, and 

does not intend to solicit, comments on 

this proposed rule change. The 

Exchange has not received any 

unsolicited written comments from 

members or other interested parties. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing proposed rule change 

has become effective pursuant to 

Section 19(b)(3)(A)(ii) of the Act 6 and 

Rule 19b–4(f)(2) thereunder,7 because it 

establishes or changes a due, fee, or 

other charge imposed by the Exchange. 

Accordingly, the proposal will take 

effect upon filing with the Commission. 

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–ISE–2007–23 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–ISE–2007–23. 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. Copies of such filing also will be 

available for inspection and copying at 

the principal office of the ISE. 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–ISE–2007–23 and should be 

submitted on or before April 26, 2007. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E7–6371 Filed 4–4–07; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55557; File No. SR–ISE–

2006–78] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Order Granting Approval of 

Proposed Rule Change Relating to the 

Facilitation Mechanism 

March 29, 2007. 

On December 13, 2006, the 

International Securities Exchange, LLC 

(‘‘ISE’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

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

Securities Exchange Act of 1934 


jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 72, No. 65 / Thursday, April 5, 2007 / Notices 16839 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 55236 

(February 2, 2007), 72 FR 6633. 

4 In approving this proposed rule change, the 

Commission has considered the proposed rule’s 

impact on efficiency, competition, and capital 

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

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

6The Exchange confirmed that, in addition to 

orders solicited pursuant to paragraph (e) of ISE 

Rule 716, the last sentence of Supplement .05 to ISE 

Rule 716 also applies to orders solicited pursuant 

to paragraph (d) of ISE Rule 716. Telephone 

conversation on March 28, 2007 between Joseph 

Ferraro, Associate General Counsel, ISE and 

Jennifer Dodd, Special Counsel, Division of Market 

Regulation, Commission. 

7 15 U.S.C. 78s(b)(2). 

8 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 In Partial Amendment No. 2 (‘‘Amendment No. 

2’’), the Exchange clarified the application of 

proposed amendments to NYSE Rule 326 to make 

explicit the ability of the Exchange to restrict the 

growth or business of a member organization, 

respectively, when its tentative net capital declines 

below the early warning notification amount 

required by the Exchange Act Rule 15c3–1(a)(7)(ii). 

4Exchange Act Release No. 54255 (July 31, 2006), 

71 FR 45086 (August 8, 2006). 

5See letter from Thomas Petrone, Managing 

Director, Citigroup Global Markets, Inc. to Nancy M. 

Morris, Secretary, Commission, dated September 

13, 2006. 

6See Partial Amendment No. 3 dated February 1, 

2007 (‘‘ Amendment No. 3’’). Amendment No. 3 

proposed amended language to Rules 325 and 326 

to add an early warning notification more restrictive 

than Commission/CFTC requirements. The text of 

Amendment No. 3 is available at the NYSE, the 

Commission’s Public Reference Room, and http:// 

www.nyse.com. 

7 7 U.S.C. 1 et seq. 

8The CFTC rules became effective on September 

30, 2004. See 69 FR 49784 (Aug. 12, 2004). The 

Commission also recently proposed amendments to 

Exchange Act Rule 15c3–1 and Rule 17a–11 to 

conform provisions of its net capital rule to the 

CTFC amendments. See Exchange Act Release No. 

54575 (October 5, 2006), 71 FR 60636 (October 13, 

2006). 

9 17 CFR 240.15c3–1. 

10Exchange Act Release No. 49830 (June 8, 2004), 

69 FR 34425 (June 21, 2004). 

(‘‘Act’’),1 and Rule 19b-4 thereunder,2 to 

amend ISE Rule 716(d) to allow an 

Electronic Access Member (‘‘EAM’’) to 

execute a transaction through the 

Exchange’s Facilitation Mechanism 

wherein the EAM has solicited interest 

from other parties to execute against a 

block-sized order it represents as agent, 

in addition to facilitating such orders 

with orders from the EAM’s proprietary 

account. The proposed rule change was 

published for comment in the Federal 

Register on February 12, 2007.3 The 

Commission received no comments on 

the proposal. This order approves the 

proposed rule change. 

The Commission finds that the 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder 

applicable to a national securities 

exchange 4 and, in particular, the 

requirements of Section 6(b)(5) of the 

Act.5 Specifically, the Commission 

believes that the proposed rule change 

is consistent with the Act because it is 

a reasonable modification designed to 

provide additional flexibility for the 

Exchange’s members to obtain blocksized executions on behalf of their 

customers. The Commission notes that 

Supplementary Material .01 to ISE Rule 

716 provides that the use of the 

Facilitation Mechanism does not alter a 

member’s best execution duty to obtain 

the best price for its customer. The 

Commission also notes that 

Supplementary Material .05 to ISE Rule 

716 requires that any solicited contra 

orders entered by Exchange members to 

trade against agency orders may not be 

for the account of an ISE market maker 

that is assigned to the options class.6

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,7 that the 

proposed rule change (SR–ISE–2006–78) 

be, and hereby is approved. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E7–6377 Filed 4–4–07; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55559; File No. SR–NYSE–

2005–03] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing of Amendment No. 3 to and 

Order Granting Accelerated Approval 

of Proposed Rule Change, as 

Amended Related to Exchange Rule 

325 (Capital Requirements for Member 

Organizations) and Rule 326 (Growth 

Capital Requirement, Business 

Reduction Capital Requirement, 

Unsecured Loans and Advances) 

March 29, 2007. 

I. Introduction 

On January 5, 2005, the New York 

Stock Exchange LLC (‘‘NYSE’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (‘‘SEC’’ or 

the ‘‘Commission’’), pursuant to Section 

19(b)(1) of the Securities Exchange Act 

of 1934 (the ‘‘Exchange Act’’),1 and Rule 

19b–4 thereunder,2 the proposed rule 

change relating to Exchange Rules 325 

and 326. The NYSE filed Amendment 

No. 1 to the proposed rule change on 

February 13, 2006. The NYSE filed 

Amendment No. 2 to the proposed rule 

change on March 17, 2006.3 The 

proposed rule change was published in 

the Federal Register on August 8, 2006.4

The Commission received one comment 

on the proposal.5 On February 1, 2007, 

the Exchange filed Amendment No. 3 to 

the proposed rule change.6

This order provides notice of 

Amendment No. 3 to the proposed rule 

change and approves the proposed rule 

change as amended on an accelerated 

basis. 

II. Description of the Proposal 

The proposed rule change consists of 

amendments to Rule 325 and Rule 326 

to reflect Commission amendments 

under the Exchange Act, including 

amendments to Exchange Act Rule 

15c3–1 that established an alternative 

method of computing net capital for 

broker-dealers, and to reflect 

amendments to Commodity Futures 

Trading Commission rules (‘‘CFTC’’) 

under the Commodities Exchange Act 7

with respect to minimum net capital 

requirements for futures commission 

merchants.8

The Commission’s net capital rule, 

Exchange Act Rule 15c3–1, imposes 

minimum financial requirements on 

broker-dealers.9 To help insure that 

broker-dealers maintain sufficient liquid 

assets to satisfy promptly the claims of 

customers and cover potential market 

and credit risks, the net capital rule 

requires broker-dealers to maintain 

different minimum levels of capital 

based upon the nature of their business 

and whether they handle customer 

funds or securities. 

On June 8, 2004, the Commission 

adopted rule amendments under the 

Exchange Act, including amendments to 

Exchange Act Rule 15c3–1, that 

established a voluntary, alternative 

method of computing net capital for 

certain large broker-dealers that are part 

of consolidated supervised groups 

referred to as consolidated supervised 

entities (‘‘CSEs’’).10 Under the 

Commission amendments, a brokerdealer may use this alternative method 

only if its ultimate holding company 

agrees to compute group-wide allowable 

capital and allowances for market, 

credit, and operational risk in 

accordance with the standards adopted 

by the Basel Committee on Banking 

Supervision, and consents to groupwide Commission supervision. The 

alternative method of computing net 

capital permits a broker-dealer to use 


jlentini on PROD1PC65 with NOTICES