Federal Register / Vol. 70, No. 179 / Friday, September 16, 2005 / Notices 54781 

1 15 U.S.C. 78k–1. 

2 17 CFR 240.11Aa3–2. 

3On July 28, 2000, the Commission approved a 

national market system plan for the purpose of 

creating and operating an intermarket options 

market linkage proposed by the Amex, CBOE, and 

ISE. See Securities Exchange Act Release No. 43086 

(July 28, 2000), 65 FR 48023 (August 4, 2000). 

Subsequently, upon separate requests by the Phlx, 

PCX, and BSE, the Commission issued orders to 

permit these exchanges to participate in the Linkage 

Plan. See Securities Exchange Act Release Nos. 

43573 (November 16, 2000), 65 FR 70850 

(November 28, 2000), 43574 (November 16, 2000), 

65 FR 70851 (November 28, 2000) and 49198 

(February 5, 2004), 69 FR 7029 (February 12, 2004). 

4Section 2(11) of the Linkage Plan. 

5Section 2(16)(a) of the Linkage Plan. 6 17 CFR 200.30–3(a)(29). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–52401; File No. 4–429] 

Joint Industry Plan; Notice of Filing of 

Joint Amendment No. 16 to the 

Intermarket Option Linkage Plan 

Relating to the Definition of Firm 

Customer Quote Size and Restrictions 

on Sending Certain Principal Acting as 

Agent Orders 

September 9, 2005. 

Pursuant to Section 11A of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 1 and Rule 11Aa3–2 thereunder,2

notice is hereby given that on April 13, 

2005, April 26, 2005, April 26, 2005, 

April 27, 2005, May 27, 2005 and June 

2, 2005, the International Securities 

Exchange, Inc. (‘‘ISE’’), American Stock 

Exchange LLC (‘‘Amex’’), Chicago Board 

Options Exchange, Incorporated 

(‘‘CBOE’’), Pacific Exchange, Inc. 

(‘‘PCX’’), Boston Stock Exchange, Inc. 

(‘‘BSE’’), and Philadelphia Stock 

Exchange, Inc. (‘‘Phlx’’) (collectively, 

the ‘‘Participants’’) respectively 

submitted to the Securities and 

Exchange Commission (‘‘Commission’’) 

Joint Amendment No. 16 to the Plan for 

the Purpose of Creating and Operating 

an Intermarket Option Linkage (the 

‘‘Linkage Plan’’).3 The Joint Amendment 

proposes to modify the definitions of 

Firm Customer Quote Size (‘‘FCQS’’) 4

and remove certain restrictions on 

sending secondary Principal Acting as 

Agent orders (‘‘P/A Orders’’) 5 through 

the Intermarket Option Linkage 

(‘‘Linkage’’). The Commission is 

publishing this notice to solicit 

comments from interested persons on 

the proposed Linkage Plan Joint 

Amendment. 

I. Description and Purpose of the 

Amendment 

The purpose of the Joint Amendment 

is to modernize the definition of FCQS. 

At the time the Linkage Plan was 

drafted, options quote sizes were not 

disseminated through the Options Price 

Reporting Authority (‘‘OPRA’’) and most 

Participants employed automatic 

execution systems that guaranteed 

automatic fills on orders less than a 

certain contract size (which was 

generally a static number). As such, the 

FCQS was calculated based on the 

number of contracts the sending or 

receiving Participant guaranteed it 

would automatically execute. Now that 

all options exchanges disseminate 

dynamic quotes with size, the 

Participants believe that it is 

appropriate to calculate the FCQS based 

on the size of the disseminated 

quotation of the Participant receiving 

the P/A Order. 

The other purpose of the Joint 

Amendment is to eliminate a 15-second 

wait period for sending a secondary P/ 

A Order pursuant to Section 

7(a)(ii)(B)(1)(b) of the Linkage Plan. That 

section governs the manner in which a 

P/A Order larger than the FCQS can be 

broken into smaller P/A Orders. It 

provides that an initial P/A Order can 

be sent to the Participant disseminating 

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

for the FCQS, and that if the NBBO 

market continues to disseminate the 

same price after 15 seconds from the 

execution of the initial P/A Order, a 

secondary P/A Order can be sent for at 

least the lesser of (i) the size of the 

disseminated quote; (ii) 100 contracts; 

or (iii) the remainder of the customer 

order underlying the P/A Orders. The 

Participants propose to eliminate the 15- 

second wait because the dynamic quotes 

with size now employed by the 

Participants obviate the need for a 

manual quote refresh period for P/A 

Orders. 

II. Implementation of the Plan 

Amendment 

The Participants intend to make the 

proposed Joint Amendment to the 

Linkage Plan reflected in this filing 

effective when the Commission 

approves the Joint Amendment. 

III. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed Joint 

Amendment to the Linkage Plan 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 4–429 on the subject line. 

Paper Comments: 

• Send paper comments in triplicate 

to Jonathan G. Katz, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–9303. 

All submissions should refer to File 

Number 4–429. 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 

Section, 100 F Street, NE., Washington, 

DC 20549. Copies of such filing also will 

be available for inspection and copying 

at the principal offices of the Amex, 

BSE, CBOE, ISE, PCX, and Phlx. 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 4–429 and should be submitted 

on or before October 7, 2005. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.6

Jonathan G. Katz, 

Secretary. 

[FR Doc. 05–18410 Filed 9–15–05; 8:45 am] 

BILLING CODE 8010–01–P