45260 Federal Register / Vol. 73, No. 150 / Monday, August 4, 2008 / Notices 

6 15 U.S.C. 78o–3(b)(6). 7 17 CFR 200.30–3(a)(12). 

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). 

of Section 15A(b)(6) of the Act,6 which 

requires, among other things, that 

FINRA rules must be designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, and, in 

general, to protect investors and the 

public interest. FINRA believes that the 

proposed rule change would eliminate 

duplicative and unnecessary rules and 

advance the development of a more 

efficient and effective Consolidated 

FINRA Rulebook. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA does not believe that the 

proposed rule change will impose any 

burden on competition 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 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) by order approve such proposed 

rule change; or 

(B) institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

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–FINRA–2008–029 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–FINRA–2008–029. 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 FINRA. 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–FINRA–2008–029 and 

should be submitted on or before 

August 25, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.7

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–17788 Filed 8–1–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58237; File No. SR–ISE–

2008–61] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to Non-Customer 

Options Orders 

July 29, 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 July 23, 

2008, the International Securities 

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 prepared by ISE. 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 proposes to amend its 

rules regarding non-customer options 

orders. The text of the proposed rule 

change is as follows, with deletions in 

[brackets] and additions in italics: 

Rule 717. Limitations on Orders 

(a) Reserved. [Market Orders and 

Marketable Limit Orders. 

Electronic Access Members shall not 

enter into the System, as principal or 

agent, Non-Customer market orders. 

Non-Customer limit orders that cross 

the market and that cannot be executed 

within two (2) minimum variations 

below the best bid or above the best 

offer cannot be executed on the 

Exchange. Such limit orders will be 

canceled by the System.] 

(b) through (g) no change. 

Supplemental Material to Rule 717 

.01 through .02 no change. 

* * * * * 

Rule 805. Market Maker Orders 

(a) Options Classes to Which 

Appointed. Market makers may not 


pwalker on PROD1PC71 with NOTICES
Federal Register / Vol. 73, No. 150 / Monday, August 4, 2008 / Notices 45261 

5See Securities Exchange Act Release No. 42455 

(February 24, 2000), 65 FR 11388 (March 2, 2000) 

(File No. 10–127) (In the Matter of the Application 

of The International Securities Exchange LLC for 

Registration as a National Securities Exchange; 

Findings and Opinion of the Commission). 

6See Securities Exchange Act Release No. 49602 

(April 22, 2004), 69 FR 23841 (April 30, 2004) (SR–

ISE–2003–26). 

7 ISE Rule 715 (Types of Orders) defines a fill-orkill order as a limit order that is to be executed in 

its entirety as soon as it is received and, if not so 

executed, treated as cancelled. A market order is 

defined in Rule 715 as an order to buy or sell a 

stated number of options contracts that is to be 

executed at the best price obtainable when the order 

reaches the Exchange. Pursuant to ISE Rule 714, 

incoming non-customer orders (which includes fillor-kill and market orders entered by market makers) 

that cannot be automatically executed on ISE 

because there is a better price on another options 

exchange are automatically rejected. 

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

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

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f)(6). 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. The Exchange has satisfied the fiveday pre-filing notice requirement. 

place principal orders to buy or sell 

options in the options classes to which 

they are appointed under Rule 802, 

other than immediate-or-cancel orders, 

market orders, fill-or-kill orders, 

complex orders and block-size orders 

executed through the Block Order 

Mechanism pursuant to Rule 716(c). 

Competitive Market Makers shall 

comply with the provisions of Rule 

804(e)(2)(ii) upon the entry of such 

orders if they were not previously 

quoting in the series. 

(b) No change. 

* * * * * 

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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization 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 

ISE proposes to amend its rules 

regarding non-customer options orders. 

ISE rules currently prohibit members 

from entering non-customer market 

orders and non-customer limit orders 

that cross the market and that cannot be 

executed within two minimum 

variations below the best bid or above 

the best offer. This limitation on noncustomer trading was included in the 

ISE rules at the time ISE was launched. 

Specifically, in support of this 

limitation, in its Form 1 application 

seeking registration as a national 

securities exchange, ISE represented 

that, in an electronic market, noncustomer market orders have the 

potential to create market volatility by 

trading at different price levels until 

their order is fully executed. ISE further 

noted that, without this limitation, noncustomers would be able to use largesize orders to quickly take out ISE’s 

entire order book without giving other 

market participants an opportunity to 

react.5 Also, at the time this restriction 

was adopted, there were various 

limitations imposed on non-customer 

trading. For example, displayed quotes 

were firm only for public customer 

orders. Since that time, electronic 

options trading has evolved. With the 

adoption of trade-through protection 

under the intermarket linkage, every 

order must be executed at the best 

quoted price. Further, ISE has also 

removed restrictions on non-customer 

trading. For example, Electronic Access 

Members (‘‘EAMs’’) may now submit 

non-customer limit orders regardless of 

the size of the order where previously 

EAMs were prohibited from submitting 

orders for non-customers that caused 

ISE’s best bid and offer to be for less 

than 10 contracts.6 The Exchange does 

not believe there is any reason to 

maintain the current restriction on noncustomer market and marketable limit 

orders, and therefore proposes to delete 

Rule 717(a) in its entirety. 

The Exchange also proposes to clarify 

in Rule 805(a) that market makers may 

enter market orders and fill-or-kill 

orders in the options classes to which 

they are appointed. The limitation on 

the types of orders market makers can 

enter in their appointed classes is 

intended to prevent market makers from 

having both standing limit orders and 

quotes in the same options class, which 

is why the rule specifically allows 

immediate-or-cancel orders. Like 

immediate-or-cancel orders, fill-or-kill 

orders and market orders are either 

filled immediately or automatically 

cancelled.7 Therefore, the Exchange 

believes that allowing ISE market 

makers to utilize these orders types is 

consistent with the Exchange’s practice 

of not allowing market makers to have 

both standing limit orders and quotes in 

the same options class. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 

and the rules and regulations 

thereunder applicable to a national 

securities exchange and, in particular, 

the requirements of Section 6(b) of the 

Act.8 Specifically, the Exchange 

believes the proposed rule change is 

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

Act’s 9 requirements that the rules of a 

national securities exchange be 

designed to promote just and equitable 

principles of trade, to prevent 

fraudulent and manipulative acts and, 

in general, to protect investors and the 

public interest. In particular, the 

proposed rule change will permit 

members to enter non-customer market 

orders and non-customer limit orders 

and thus, enable the Exchange to 

compete effectively with other options 

exchanges who do not have a similar 

restriction. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

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 

Because the foregoing rule change 

does not: (1) Significantly affect the 

protection of investors or the public 

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 Act 10 and Rule 19b–

4(f)(6) thereunder.11

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 


pwalker on PROD1PC71 with NOTICES
45262 Federal Register / Vol. 73, No. 150 / Monday, August 4, 2008 / Notices 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 Item 3.01 of Form 8–K requires a registrant to 

file a Form 8–K within four business days of receipt 

of notice from the national securities exchange that 

maintains the principal listing for any class of the 

registrant’s common equity that the registrant or 

such class of the registrant’s securities does not 

satisfy a rule or standard for continued listing on 

the exchange. 

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–2008–61 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–ISE–2008–61. 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 the filing also will be available 

for inspection and copying at the 

principal office of 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–

2008–61 and should be submitted on or 

before August 25, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–17762 Filed 8–1–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58235; File No. SR–NYSE–

2008–59] 

Self-Regulatory Organizations; New 

York Stock Exchange, LLC; Notice of 

Filing of Proposed Rule Change To 

Reduce the Period Within Which 

Companies Must Issue a Press 

Release After the Exchange Notifies 

Them That They Are Noncompliant 

With Exchange Listing Requirements 

July 28, 2008. 

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

Securities Exchange Act of 1934 (the 

‘‘Exchange Act’’),1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on July 22, 2008, New York Stock 

Exchange, LLC (the ‘‘NYSE’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (the 

‘‘Commission’’ or ‘‘SEC’’) 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 

Sections 802.02 and 802.03 of the 

Exchange’s Listed Company Manual 

(the ‘‘Manual’’) to provide that the 

Exchange will require a U.S. company, 

upon receiving written notification that 

it has fallen below the Exchange’s 

listing standards, to issue a press release 

within the same amount of time as 

allotted by the SEC for the company to 

disclose such an occurrence, but in no 

event later than four business days after 

receipt of such notification, and will 

require a non-U.S. company to issue a 

press release within 30 days of receiving 

written notification from the Exchange 

that it has fallen below the Exchange’s 

listing standards. The text of the 

proposed rule change is available at 

http://www.nyse.com, the NYSE, 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 

NYSE 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 proposes to amend 

Sections 802.02 and 802.03 of the 

Manual to provide that the Exchange 

will require a U.S. company, upon 

receipt of written notification that it has 

fallen below the Exchange’s listing 

standards, issue a press release within 

the amount of time allotted by the SEC 

for companies to disclose such an 

occurrence. The Exchange will also 

require a non-U.S. company to issue a 

press release within 30 days of receiving 

written notification that it has fallen 

below the Exchange’s listing standard. 

Currently, Section 802.02 of the 

Manual requires a U.S. company to 

issue a press release within 45 days of 

receiving written notification from the 

Exchange that it has fallen below the 

Exchange’s listing standards. However, 

SEC rules require the company to file a 

Form 8–K giving notice of that event 

within four business days of being 

notified by the Exchange.3 The 

Exchange believes that its own 

requirement is too long in light of the 

much earlier public notice required by 

the Form 8–K rule and that it is 

appropriate for the Exchange to issue a 

press release on the subject itself if the 

company has not acted within the 

period provided by Form 8–K and in 

any event no later than four business 

days after receipt of notification from 

the Exchange. The Exchange notes that 

companies that are incorporated in 

jurisdictions outside the United States 

but that do not qualify as foreign private 


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