19732 Federal Register / Vol. 72, No. 75 / Thursday, April 19, 2007 / Notices 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5See Securities Exchange Act Release No. 54391 

(August 31, 2006), 71 FR 52836 (September 7, 2006) 

(SR–NSX–2006–08). 

6See Securities Exchange Act Release No. 54808 

(November 21, 2006), 71 FR 69163 (November 29, 

2006) (SR–NSX–2006–15). 

7 Id. 

8 In January 2007, NSX Securities’ application for 

registration as a broker-dealer was approved by the 

National Association of Securities Dealers, Inc. As 

of March 1, 2007, the Exchange had not yet begun 

using NSX Securities for routing services. 

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

10 15 U.S.C. 78f(b)(5). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55624; File No. SR–NSX–

2007–04] 

Self-Regulatory Organizations; 

National Stock Exchange, Inc.; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change To Extend 

the Effective Period for Rule 2.12 

Regarding Third-Party Routing 

Services in Respect of Orders Entered 

Into NSX BLADE 

April 12, 2007. 

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 April 3, 

2007, the National Stock Exchange, Inc. 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been 

substantially prepared by NSX. The 

Exchange has filed the proposal as a 

‘‘non-controversial’’ rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6) thereunder,4

which renders it 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 extend 

the effective period for Rule 2.12, which 

describes the terms under which the 

Exchange provides routing services 

procured from a third party with respect 

to orders entered into its new state of 

the art trading system, NSX BLADE. The 

text of the proposed rule change is 

available at NSX, the Commission’s 

Public Reference Room, and http:// 

www.nsx.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, 

NSX 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. NSX 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 is proposing to amend 

Exchange Rules 2.11 and 2.12 to extend 

the effective period for Rule 2.12 

(relating to the Exchange’s use of a third 

party to provide outbound routing of 

orders from the Exchange to other 

trading centers (‘‘Routing Services’’)) 

through June 30, 2007, and to delay the 

effectiveness of Rule 2.11 (relating to the 

outbound routing function of the 

Exchange’s affiliate, NSX Securities, 

LLC (‘‘NSX Securities’’)) until July 1, 

2007. 

Rule 2.11 provides for certain terms 

and conditions under which NSX 

Securities, an affiliate of the Exchange, 

will provide Routing Services. Rule 2.11 

was approved by the Commission in 

connection with the approval of the 

Exchange’s new trading rules relating to 

NSX BLADE on August 31, 2006.5 The 

Exchange subsequently filed and 

received approval for the addition of 

Rule 2.12, which provides for terms and 

conditions of the Exchange’s use of a 

third party to provide Routing Services.6

Rule 2.12 currently provides that it is 

effective through February 28, 2007, 

with Rule 2.11 becoming effective on 

March 1, 2007. In connection with the 

rule filing adding Rule 2.12,7 the 

Exchange requested this finite period of 

effectiveness so that the Exchange could 

offer routing services through NSX 

BLADE while NSX Securities completed 

its registration process as a brokerdealer with the National Association of 

Securities Dealers, Inc. (and thus 

became available to provide routing 

services),8 and while the Exchange 

evaluated its options for providing 

routing services to ETP Holders. 

In the instant rule filing, the Exchange 

is proposing to extend the effectiveness 

of Rule 2.12 through June 30, 2007, and 

to delay the effectiveness of Rule 2.11 

until July 1, 2007, in order to allow the 

Exchange more time to evaluate its 

options for providing routing services to 

ETP Holders. The ability to route orders 

entered into NSX BLADE to away 

markets for execution at the best 

available prices is a key feature of NSX’s 

new system. 

The Exchange intends to provide 

routing services in accordance with 

Rule 2.12 until June 30, 2007, unless the 

Exchange, with the Commission’s 

approval, amends Rule 2.12 before such 

date. During such time period, the 

Exchange intends to evaluate its options 

for providing routing services. At the 

conclusion of such time period, the 

Exchange may decide to (i) Continue the 

approach provided for in Rule 2.12 on 

a permanent basis, and not use NSX 

Securities as the outbound router (by 

filing a proposed rule change to delete 

Rule 2.11 and renumbering Rule 2.12); 

(ii) use the Exchange’s original approach 

of NSX Securities as an outbound router 

and discontinue the approach provided 

for in Rule 2.12 (by filing a proposed 

rule change to delete Rule 2.12) or (iii) 

file a proposed rule change to allow ETP 

Holders to use either NSX Securities or 

the approach provided for in proposed 

Rule 2.12 for outbound routing. 

2. Statutory Basis 

NSX believes the proposed rule 

change is consistent with Section 6(b) of 

the Act,9 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,10

in particular, which requires, among 

other things, that the rules of an 

exchange be 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. 

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 either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing rule change 

does not: (1) Significantly affect the 

protection of investors or the public 


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Federal Register / Vol. 72, No. 75 / Thursday, April 19, 2007 / Notices 19733 

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

12 17 CFR 240.19b–4(f)(6). 

13 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 date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. NSX has satisfied the five-day prefiling notice requirement. 

14 Id. 

15For the 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). 16 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Amendment No. 1, which supplemented the 

original filing, the NSX provided more information 

regarding the certification process and corrected a 

grammatical error. 

interest; (2) impose any significant 

burden on competition; and (3) become 

operative for 30 days after the date of 

this filing, or such shorter time as the 

Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act11 and Rule 19b–

4(f)(6) thereunder.12

A proposed rule change filed under 

19b–4(f)(6) normally may not become 

operative prior to 30 days after the date 

of filing.13 However, Rule 19b–

4(f)(6)(iii) 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 has requested that the 

Commission waive the 30-day operative 

delay. The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest 

because such waiver would permit the 

Exchange to immediately update the 

effective dates for NSX Rules 2.11 and 

2.12. For this reason, the Commission 

designates the proposed rule change to 

be operative upon filing with the 

Commission.15

At any time within 60 days of the 

filing of such 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–NSX–2007–04 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NSX–2007–04. 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 the filing also will be 

available for inspection and copying at 

the principal office of NSX. 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–NSX–2007–04 and should 

be submitted on or before May 10, 2007. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.16

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E7–7422 Filed 4–18–07; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55631; File No. SR–NSX–

2006–16] 

Self-Regulatory Organizations; 

National Stock Exchange, Inc.; Notice 

of Filing of Proposed Rule Change and 

Amendment No. 1 Thereto Regarding 

the Annual Certification of Compliance 

and Supervisory Processes 

April 13, 2007. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that on November 

22, 2006, the National Stock Exchange, 

Inc. (‘‘NSX’’ 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 prepared by the Exchange. 

On April 9, 2007, the NSX filed 

Amendment No. 1 to the proposed rule 

change (‘‘Amendment No. 1’’).3 The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change, as amended, from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to adopt NSX 

Rule 5.7 and accompanying 

Interpretations and Policies .01 (Annual 

Compliance and Supervision 

Certification) to require each Equity 

Trading Permit (‘‘ETP’’) Holder’s Chief 

Executive Officer (‘‘CEO’’) to certify 

annually to having in place a process to 

establish, maintain, review, modify, and 

test policies and procedures reasonably 

designed to achieve compliance with 

applicable Rules of the Exchange, and 

federal securities laws and regulations. 

The text of the proposed rule and 

interpretation is set forth below. 

Proposed new language is italicized. 

* * * * * 

CHAPTER V. 

SUPERVISION 

* * * * * 

Rule 5.7. Annual Certification of 

Compliance and Supervisory Processes 

Each ETP Holder shall have its chief 

executive officer (or equivalent officer) 

certify annually, as set forth in 


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