Federal Register / Vol. 74, No. 133 / Tuesday, July 14, 2009 / Notices 34063 

9 15 U.S.C. 78s(b)(3)(A)(ii). 

10 17 CFR 240.19b–4(f)(2). 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b-4. 

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. 

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 

The foregoing proposed rule change is 

effective upon filing pursuant to Section 

19(b)(3)(A)(ii) of the Act 9 and Rule 19b– 

4(f)(2) thereunder.10 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–CHX–2009–08 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–CHX–2009–08. 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 such filing will also 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 No. SR–CHX–2009– 

08 and should be submitted on or before 

August 4, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. E9–16582 Filed 7–13–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60253; File No. SR–ISE– 

2009–34] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Regarding Customer Cross 

Orders 

July 7, 2009. 

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 June 24, 

2009, International Securities Exchange, 

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

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the selfregulatory organization. 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 proposes to adopt rules 

related to the execution of Customer 

Cross Orders. The text of the proposed 

rule amendment is as follows, with 

deletions in [brackets] and additions 

italicized: 

* * * * * 

Rule 715. Types of Orders 

(a) through (h) no change. 

(i) Customer Cross Orders. A 

Customer Cross Order is comprised of a 

Public Customer Order to buy and a 

Public Customer Order to sell at the 

same price and for the same quantity. 

* * * * * 

Rule 717. Limitations on Orders 

(a) through (g) no change. 

Supplemental Material to Rule 717 

.01 Rule 717(d) prevents an Electronic 

Access Member from executing agency 

orders to increase its economic gain 

from trading against the order without 

first giving other trading interest on the 

Exchange an opportunity to either trade 

with the agency order or to trade at the 

execution price when the Member was 

already bidding or offering on the book. 

However, the Exchange recognizes that 

it may be possible for an Electronic 

Access Member to establish a 

relationship with a customer or other 

person (including affiliates) to deny 

agency orders the opportunity to 

interact on the Exchange and to realize 

similar economic benefits as it would 

achieve by executing agency orders as 

principal. It will be a violation of Rule 

717(d) for an Electronic Access Member 

to be a party to any arrangement 

designed to circumvent Rule 717(d) by 

providing an opportunity for a customer 

or other person (including affiliates) to 

regularly execute against agency orders 

handled by the Electronic Access 

Member immediately upon their entry 

into the System. 

.02 no change. 

* * * * * 

Rule 721. [[Reserved]] Customer Cross 

Orders 

Customer Cross Orders are 

automatically executed upon entry 

provided that the execution is at or 

between the best bid and offer on the 

Exchange and (i) is not at the same 

price as a Public Customer Order on the 

Exchange’s limit order book and (ii) will 

not trade through the NBBO unless the 

order is for at least 500 contracts and 

has a premium value of at least 

$150,000. 

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34064 Federal Register / Vol. 74, No. 133 / Tuesday, July 14, 2009 / Notices 

3 ISE Rule 717(d) (Principal Transactions) and 

Rule 717(e) (Solicitation Orders). 

4 ISE Rule 716 (Block Trades) and Rule 723 (Price 

Improvement Mechanism for Crossing 

Transactions). See e-mail from Kathy Simmons, 

Deputy General Counsel, ISE, to Ira Brandriss, 

Special Counsel, and Brian O’Neill, Attorney, 

Division of Trading and Markets, Commission, 

dated July 1, 2009. 

5Execution of orders of at least 500 contracts and 

with a premium value of at least $150,000 will meet 

the definition of a Block Trade in ISE Rule 1900(2) 

(definitions under the Linkage Rules). 

6 15 U.S.C. 78f(b). 

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

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires the self-regulatory organization 

to 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 this requirement. 

(a) Customer Cross Orders will be 

automatically canceled if they cannot be 

executed. 

(b) Customer Cross Orders may only 

be entered in the regular trading 

increments applicable to the options 

class under Rule 710. 

(c) Supplemental Material .01 to Rule 

717 applies to the entry and execution 

of Customer Cross Orders. 

* * * * * 

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 IV 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 

Under the Exchange’s options rules, 

members are required to expose trading 

interest to the market before executing 

agency orders as principal or before 

executing agency orders against orders 

that were solicited from other brokerdealers (i.e., proprietary and solicited 

crossing transactions),3 and the 

Exchange provides several different 

mechanisms that allow members to 

execute these types of crossing 

transactions in a manner that complies 

with the exposure requirement.4

However, the ISE options rules do not 

contain any limitations or exposure 

requirements regarding the execution of 

customer orders against other customer 

orders, and the Exchange has developed 

a way to enter opposing customer orders 

using a single order type (‘‘Customer 

Cross Orders’’). 

The purpose of this rule proposal is 

to adopt rules regarding the entry and 

execution of Customer Cross Orders. In 

particular, the Exchange proposes to 

add a definition of a Customer Cross 

Order specifying that a Customer Cross 

Order is comprised of a Public Customer 

Order to buy and a Public Customer 

Order to sell at the same price and for 

the same quantity. The Exchange also 

proposes to adopt Rule 721 specifying 

that Customer Cross Orders are 

automatically executed upon entry 

provided that the execution will not 

take place at the same price as a Public 

Customer Order on the limit order book, 

nor trade through the national best bid 

or offer unless the order is for at least 

500 contracts and has a premium value 

of at least $150,000.5 The proposed rule 

also specifies that Customer Cross 

Orders entered at a price that is outside 

of the NBBO or at the same price as a 

Public Customer Order on the limit 

order book will be automatically 

canceled, and that Customer Cross 

Orders may only be entered in the 

regular trading increments applicable to 

the options class under Rule 710. 

Finally, the proposal specifies that 

Supplemental Material .01 to Rule 717, 

which prohibits a member from being a 

party to any arrangement designed to 

circumvent the requirements applicable 

to executing agency orders as principal, 

applies to the entry and execution of 

Customer Cross Orders. In this respect, 

the Exchange proposes to amend 

Supplemental Material .01 to Rule 717 

to specifically reference affiliates of 

member firms, which is consistent with 

how the Exchange has interpreted the 

provision. 

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.6 Specifically, the Exchange 

believes the proposed rule change is 

consistent with the requirement of 

Section 6(b)(5) 7 that an exchange have 

rules that are designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to remove 

impediments to and perfect the 

mechanism for a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. In particular, the 

proposal provides for the efficient entry 

and execution of Customer Cross Orders 

while also protecting Public Customer 

Orders on the book at the same price. 

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 

regarding 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 proposed rule 

change: (i) Does not significantly affect 

the protection of investors or the public 

interest; (ii) does not impose any 

significant burden on competition; and 

(iii) by its terms, does not become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, if 

consistent with the protection of 

investors and the public interest, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 8 and Rule 19b– 

4(f)(6) thereunder.9

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: 

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Federal Register / Vol. 74, No. 133 / Tuesday, July 14, 2009 / Notices 34065 

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. 52497 

(September 22, 2005), 70 FR 56949 (September 29, 

2005) (SR–PCX–2005–90); see also Securities 

Exchange Act Release No. 44983 (October 25, 2001), 

66 FR 55225 (November 1, 2001) (SR–PCX–00–25); 

see also Securities Exchange Act Release No. 58681 

(September 29, 2008), 73 FR 58285 (October 6, 

2008) (order approving NYSEArca–2008–90). See 

Securities Exchange Act Release No. 55590 (April 

5, 2007), 72 FR 18707 (April 13, 2007) (notice of 

immediate effectiveness of SR–NYSE–2007–29); see 

also Securities Exchange Act Release No. 58680 

(September 29, 2008), 73 FR 58283 (October 6, 

2008) (order approving SR–NYSE–2008–76). See 

Securities Exchange Act Release No. 59009 

(November 24, 2008), 73 FR 73363 (December 2, 

2008) (SR–NYSEALTR–2008–07). 

4See Securities Exchange Act Release No. 58680 

(September 29, 2008), 73 FR 58283 (October 6, 

2008) (order approving SR–NYSE–2008–76). 

ArcaSec had been previously authorized to deliver 

inbound routes to the NYSE, acting in its capacity 

as an order routing facility for NYSE Arca. See 

supra note 3. 

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

6 15 U.S.C. 78f(b)(5). 

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–2009–34 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–ISE–2009–34. 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 such 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–ISE– 

2009–34 and should be submitted on or 

before August 4, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. E9–16577 Filed 7–13–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60255; File No. SR–NYSE– 

2009–58] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Order Granting Accelerated 

Approval of Proposed Rule Change to 

Amend the Scope of the Exchange’s 

Prior Approval to Receive Inbound 

Routes from Archipelago Securities 

LLC (‘‘ArcaSec’’), an Affiliated Member 

July 7, 2009. 

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 June 23, 

2009, the New York Stock Exchange 

LLC (‘‘NYSE’’ or the ‘‘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 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 amend the 

scope of the Exchange’s prior approval 

to receive inbound routes of PO Plus 

Orders from Archipelago Securities LLC 

(‘‘ArcaSec’’), an NYSE affiliated 

member. The text of the proposed rule 

change is available at the Exchange, the 

Commission’s Public Reference Room, 

and http://www.nyse.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, 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 IV 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 

ArcaSec is the approved outbound 

order routing facility of the NYSE, 

NYSE Arca Inc. (‘‘NYSE Arca’’) and 

NYSE Amex LLC.3 In this context, the 

Exchange has been previously 

authorized, on a pilot basis, to receive 

inbound PO Plus Orders from ArcaSec, 

acting in its capacity as the outbound 

order routing facility for NYSE Arca.4

The Exchange hereby proposes that, in 

addition to PO Plus Orders, the 

Commission authorize the NYSE to 

receive all NYSE Arca order types 

approved or implemented on or after the 

date of approval of this proposal. The 

Exchange does not propose any further 

changes to its authorization to receive 

inbound routes from ArcaSec or to the 

term of the pilot period. All existing 

conditions currently in place with 

respect to ArcaSec routing orders to the 

NYSE, in its capacity as an outbound 

order routing facility for NYSE Arca, 

will continue to apply. The Exchange 

believes that this proposal, if approved, 

will authorize the Exchange to receive 

any NYSE Arca order types approved 

subsequent to the approval of this 

proposal and going forward through the 

end of the pilot period. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) 5 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’), in general, and furthers the 

objectives of Section 6(b)(5),6 in 

particular, in that it is designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, to foster 

mstockstill on DSKH9S0YB1PROD with NOTICES