Federal Register / Vol. 74, No. 4 / Wednesday, January 7, 2009 / Notices 755 

impact on efficiency, competition, and capital 

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

7 15 U.S.C. 78f(b)(5). 

8See e-Mail from Tim Malinowski, Director, 

NYSE Euronext, to Christopher W. Chow, Special 

Counsel, Commission, dated December 23, 2008. 

See also Securities Exchange Act Release No. 56637 

(October 10, 2007), 72 FR 58704, 58709 (October 16, 

2007). 

9 15 U.S.C. 78s(b)(2). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 58444 

(August 29, 2008), 73 FR 51872 (September 5, 2008) 

(SR–NYSEArca–2008–96). 

4See Securities Exchange Act Release Nos. 57965 

(June 16, 2008), 73 FR 35178 (June 20, 2008) (SR– 

NASDAQ–2006–060); 57973 (June 16, 2008), 73 FR 

35430 (June 23, 2008) (SR–NASDAQ–2008–050). 

5See Securities Exchange Act Release No. 57966 

(June 16, 2008), 73 FR 35182 (June 20, 2008) (SR– 

NYSE–2007–04). 

6The Exchange notes that it will make the NYSE 

Arca Realtime Reference Prices available to vendors 

no earlier than it makes those prices available to the 

processor under the CTA Plan. 

Commission finds that the proposed 

rule change is consistent with Section 

6(b)(5) of the Act,7 which requires that 

the rules of the Exchange be designed, 

among other things, 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 Commission believes that the 

proposal reasonably balances the 

removal of impediments to a free and 

open market with the protection of 

investors and the public interest, two 

principles set forth in Section 6(b)(5) of 

the Act. As a result of the proposal, the 

permissible percentage of underlying 

foreign country securities and/or foreign 

country securities underlying ADRs 

trading on foreign markets that are not 

ISG members or parties to a CSSA with 

the Exchange would be limited to 50% 

of the overall dollar weight of the index. 

The Commission believes that this 

portion of the proposal would permit 

increased flexibility with respect to 

listing and trading Equity Index-Linked 

Securities. At the same time, the 

proposed amendment also provides that 

the securities trading on: (1) Any one 

Non-Reciprocal Foreign Market must 

not constitute more than 20% of the 

overall dollar weight of the index; and 

(2) any two Non-Reciprocal Foreign 

Markets must not constitute more than 

33% of the overall dollar weight of the 

index. These conditions establish 

concentration limits designed to ensure 

that a significant percentage of an 

underlying index is not composed of 

securities trading on any one or two 

Non-Reciprocal Foreign Markets. 

Additionally, in light of its proposed 

revision to the listing criteria for Equity 

Index-Linked Securities, the Exchange 

has renewed its representation that its 

surveillance procedures applicable to 

Equity Index-Linked Securities are 

adequate to detect and deter violations 

of its Rules and all applicable federal 

securities laws.8

The Commission also believes that the 

technical and non-substantive changes 

to NYSE Arca Equities Rule 

5.2(j)(6)(B)(I)(1)(b)(v) clarify the format 

and application of the proposed 

amendment related to Equity IndexLinked Securities. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,9 that the 

proposed rule change (SR–NYSEArca– 

2008–121) be, and it hereby is, 

approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E9–6 Filed 1–6–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59184; File No. SR– 

NYSEArca–2008–143] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and Order 

Granting Accelerated Approval of 

Proposed Rule Change To Extend the 

Pilot Program for NYSE Arca Realtime 

Reference Prices Service 

December 30, 2008. 

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 December 

30, 2008, NYSE Arca, Inc. (the 

‘‘Exchange’’ or ‘‘NYSE Arca’’) 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. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons, and is 

approving the proposal on an 

accelerated basis. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to extend the 

expiration date of its pilot program for 

the NYSE Arca Realtime Reference 

Prices service until March 31, 2009. 

There is no new rule text. 

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 III 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 

In File No. SR–NYSEArca–2008–96, 

the Exchange established a pilot 

program that allows the Exchange to test 

the viability of a new NYSE Arca-only 

market data service that allows a vendor 

to redistribute on a real-time basis last 

sale prices of transactions that take 

place on the Exchange (‘‘NYSE Arca 

Realtime Reference Prices’’) and to 

establish a flat monthly fee for that 

service. The Commission approved that 

pilot program on August 29, 2008.3

The Exchange intends for the NYSE 

Arca Realtime Reference Prices service 

to accomplish three goals: 

1. To provide a low-cost service that 

will make real-time prices widely 

available to millions of casual investors; 

2. To provide vendors with a real-time 

substitute for delayed prices; and 

3. To relieve vendors of 

administrative burdens. 

This pilot program is similar to pilot 

programs that the Nasdaq Stock Market, 

Inc. (‘‘Nasdaq’’) 4 and the New York 

Stock Exchange, LLC (‘‘NYSE’’) 5 have 

established. 

The pilot program allows internet 

service providers, traditional market 

data vendors, and others (‘‘NYSE ArcaOnly Vendors’’) to make available NYSE 

Arca Realtime Reference Prices on a 

real-time basis.6 The NYSE Arca 

Realtime Reference Price information 

includes last sale prices for all securities 

that trade on the Exchange. It includes 

only prices, and not the size of each 

trade and not bid/asked quotations. 

It features a flat, fixed monthly vendor 

fee, no user-based fees, no vendor 

reporting requirements, and no 

professional or non-professional 

subscriber agreements. 

756 Federal Register / Vol. 74, No. 4 / Wednesday, January 7, 2009 / Notices 

7See Securities Exchange Act Release No. 58895 

(October 31, 2008), 73 FR 66956 (November 12, 

2008) (SR–NYSEArca–2008–122). 

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

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

10 In approving this proposed rule change, the 

Commission has considered the proposed rule’s 

impact on efficiency, competition, and capital 

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

11 15 U.S.C. 78f(b)(4). 

12 15 U.S.C. 78f(b)(5). 

13 15 U.S.C. 78f(b)(8). 

14 17 CFR 242.603(a). 

15NYSE Arca is an exclusive processor of its last 

sale data under Section 3(a)(22)(B) of the Act, 15 

U.S.C. 78c(a)(22)(B), which defines an exclusive 

processor as, among other things, an exchange that 

distributes data on an exclusive basis on its own 

behalf. 

16See supra notes 3 and 7. 

17See Securities Exchange Act Release No. 59039 

(December 2, 2008), 73 FR 74770 (December 9, 

2008) (Order Setting Aside Action by Delegated 

Authority and Approving Proposed Rule Change 

Relating to NYSE Arca Data). 

The Exchange established November 

1, 2008 as the end date for the pilot 

program. The Exchange then extended 

that end date to December 31, 2008.7

The Exchange now seeks to extend that 

end date to March 31, 2009. Prior to the 

end of the pilot period, the Exchange 

will assess its experience with the 

product and either will submit a 

proposed rule change that seeks to 

extend or modify the pilot program or 

to make it permanent, or it will 

announce publicly that it does not seek 

to extend the pilot program beyond the 

program’s termination date. 

2. Statutory Basis 

The basis under the Act for this 

proposed rule change is the requirement 

under Section 6(b)(4) 8 that an exchange 

have rules that provide for the equitable 

allocation of reasonable dues, fees and 

other charges among its members and 

other persons using its facilities and the 

requirements under Section 6(b)(5) 9

that the rules of an exchange be 

designed to promote just and equitable 

principles of trade and not to permit 

unfair discrimination between 

customers, issuers, brokers or dealers. 

The Exchange believes that the pilot 

program benefits investors by 

facilitating their prompt access to 

widespread, free, real-time pricing 

information contained in the NYSE Arca 

Realtime Reference Prices service. 

Extending the pilot program will extend 

those benefits while the Exchange 

assesses the service. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

this 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 

The Exchange has not received any 

unsolicited written comments from 

members or other interested parties. 

III. 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–NYSEArca–2008–143 on 

the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSEArca–2008–143. 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 the 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– 

NYSEArca–2008–143 and should be 

submitted on or before January 28, 2009. 

IV. Commission’s Findings and Order 

Granting Accelerated Approval of a 

Proposed Rule Change 

The Commission finds that the 

proposed rule change, to extend the 

pilot program for three months, is 

consistent with the requirements of the 

Act and the rules and regulations 

thereunder applicable to a national 

securities exchange.10 In particular, it is 

consistent with Section 6(b)(4) of the 

Act,11 which requires that the rules of 

a national securities exchange provide 

for the equitable allocation of reasonable 

dues, fees, and other charges among its 

members and issuers and other parties 

using its facilities, and Section 6(b)(5) of 

the Act,12 which requires, among other 

things, that the rules of a national 

securities 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, and 

not be designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

The Commission also finds that the 

proposed rule change is consistent with 

the provisions of Section 6(b)(8) of the 

Act,13 which requires that the rules of 

an exchange not impose any burden on 

competition not necessary or 

appropriate in furtherance of the 

purposes of the Act. Finally, the 

Commission finds that the proposed 

rule change is consistent with Rule 

603(a) of Regulation NMS,14 adopted 

under Section 11A(c)(1) of the Act, 

which requires an exclusive processor 

that distributes information with respect 

to quotations for or transactions in an 

NMS stock to do so on terms that are 

fair and reasonable and that are not 

unreasonably discriminatory.15

The Commission approved the fee for 

NYSE Arca Realtime Reference Prices 

for a pilot period which runs until 

December 31, 2008.16 The Commission 

notes that the Exchange proposes to 

extend the pilot program for three 

months. The Exchange proposes no 

other changes to the existing pilot 

program. 

On December 2, 2008, the 

Commission issued an approval order 

(‘‘Order’’) that sets forth a market-based 

approach for analyzing proposals by 

self-regulatory organizations to impose 

fees for ‘‘non-core’’ market data 

products, such as NYSE Arca Realtime 

Reference Prices.17 The Commission 

believes that NYSE Arca’s proposal to 

Federal Register / Vol. 74, No. 4 / Wednesday, January 7, 2009 / Notices 757 

18See supra notes 3 and 7. 

19The Exchange represents that it intends to file 

a proposal seeking permanent approval of NYSE 

Arca Realtime Reference Prices. Telephone 

conversation between Ronald Jordan, Executive 

Vice President, Market Data Services, NYSE 

Euronext, and John Roeser, Assistant Director, 

Division of Trading and Markets, Commission, on 

December 30, 2008. 

20 15 U.S.C. 78s(b)(2). 

21 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See NYSE Arca Rule 6.35—Appointment of 

Market Makers. 

temporarily extend the pilot program is 

consistent with the Act for the reasons 

noted in the Order.18 The Commission 

believes that approving NYSE Arca’s 

proposal to temporarily extend the pilot 

program that imposes a fee for NYSE 

Arca Realtime Reference Prices for an 

additional three months will be 

beneficial to investors and in the public 

interest, in that it is intended to allow 

continued broad public dissemination 

of increased real-time pricing 

information. In addition, extending the 

pilot program for an additional three 

months will allow NYSE Arca, 

consistent with its representation,19 to 

file, the public to comment on, and the 

Commission to analyze consistent with 

the Order and in light of Section 19(b) 

of the Act, a proposal to permanently 

approve the fee for NYSE Arca Realtime 

Reference Prices. 

The Commission finds good cause for 

approving the proposed rule change 

before the thirtieth day after the date of 

publication of notice of filing thereof in 

the Federal Register. Accelerating 

approval of this proposal is expected to 

benefit investors by continuing to 

facilitate their access to widespread, 

free, real-time pricing information 

contained in NYSE Arca Realtime 

Reference Prices. Therefore, the 

Commission finds good cause, 

consistent with Section 19(b)(2) of the 

Act,20 to approve the proposed rule 

change on an accelerated basis to extend 

the operation of the pilot until March 

31, 2009. 

V. Conclusion 

It is therefore ordered, pursuant to 

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

proposed rule change (SR–NYSEArca– 

2008–143) is hereby approved on an 

accelerated basis until March 31, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E9–8 Filed 1–6–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59191; File No. SR– 

NYSEArca–2008–139] 

Self-Regulatory Organizations; Notice 

of Filing of Proposed Rule Change by 

NYSE Arca, Inc. Amending the Minor 

Rule Plan To Increase Certain 

Sanctions 

December 31, 2008. 

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 December 

17, 2008, NYSE Arca, Inc. (‘‘NYSE 

Arca’’ or the ‘‘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. 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 

Rule 10.12 Minor Rule Plan by 

increasing certain sanctions contained 

in the fine schedule. The Exchange also 

proposes to make minor technical 

changes at this time. A copy of this 

filing is available on the Exchange’s 

Web site at http://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 

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 Minor Rule Plan (‘‘MRP’’) fosters 

compliance with applicable rules and 

also helps to reduce the number and 

extent of rule violations committed by 

Options Trading Permit (‘‘OTP’’) 

Holders, OTP Firms and associated 

persons. The prompt imposition of a 

financial penalty helps to quickly 

educate and improve the conduct of 

OTP Holders, OTP Firms and associated 

persons that have engaged in 

inadvertent or otherwise minor 

violations of the Exchange’s rules, 

particularly those who may not pay 

attention to mere warnings that they are 

violating Exchange rules. By promptly 

imposing a meaningful financial penalty 

for such violations, the MRP focuses on 

correcting conduct before it gives rise to 

more serious enforcement action. 

Market Makers on NYSE Arca receive 

certain rights and privileges in return 

for meeting certain obligations. These 

obligations include adhering to certain 

rules regarding quoting, in-person 

trading requirements, and fulfilling the 

terms of a Market Maker Appointment.3

Failure to comply with rules these 

governing Market Maker obligations 

may result in a fine pursuant to the 

MRP. At this time the Exchange feels 

the current monetary fine levels 

contained in the MRP, for violations of 

certain rules pertaining to Market 

Makers, are too low, given the serious 

nature of these rules. In order to act as 

an effective deterrent against future 

violations, while also serving as a just 

penalty for those who commit these 

violations, the Exchange proposes to 

raise the fine levels for violations 

related to certain rules governing Market 

Maker obligations. A brief description of 

each proposed change is shown below. 

Rule 10.12(k)(i)25. 

At least 75% of the trading activity of 

a Market Maker (measured in terms of 

contract volume per quarter) must be in 

classes within the Market Maker’s 

Appointment. A failure to comply with 

the 75% contract volume requirement 

may result in a fine of $500.00 for a first 

offense, $1,000.00 for a second offense 

and $2,500.00 for a third offense. The 

Exchange proposes to raise these 

suggested fines to $1,000.00 for a first 

offense, $2,500.00 for a second offense 

and $3,500.00 for a third offense. 

Rule 10.12(k)(i)26. 

At least 60% of a Market Maker’s 

transactions must be executed by the 

Market Maker in person or through an 

approved facility of the Exchange. A 

failure to comply with this 60% inperson trading requirement may result 

in a fine of $500.00 for a first offense, 

$1,000.00 for a second offense and 

$2,500.00 for a third offense. The 

Exchange proposes to raise these