Document ID: SEC-2012-1992-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE MKT LLC
Posted Date: 2012-12-04T05:00Z

[Federal Register Volume 77, Number 233 (Tuesday, December 4, 2012)]
[Notices]
[Pages 71846-71848]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-29216]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68306; File No. SR-NYSEMKT-2012-68]

Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Amending Its Rules To 
Delete Obsolete and Out-Dated Rules

November 28, 2012.
    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 14, 2012, NYSE MKT LLC (the ``Exchange'' or ``NYSE 
MKT'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the Exchange. The Exchange 
filed the proposal as a ``non-controversial'' proposed rule change 
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder.\4\ The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its rules to delete obsolete and 
out-dated rules. The text of the proposed rule change is available on 
the Exchange's Web site at www.nyse.com, at the principal office of the 
Exchange, 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 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its rules to delete obsolete and 
out-dated rules. By removing these obsolete and out-dated rules, the 
Exchange is not proposing to change or alter any obligations, rights, 
policies or practices enumerated within its rules. Rather, the proposal 
to delete obsolete and out-dated rules will reduce any potential 
confusion that may result from having obsolete rules continue to appear 
in the Exchange's rulebook.
    As part of its review to identify obsolete and out-dated rules, the 
Exchange proposes to delete rules that relate to trading systems that 
have since been decommissioned by the Exchange and rules that were 
superseded by later-implemented rules governing the same conduct or 
circumstances. In particular, the proposed rule changes relate to 
Exchange rules that previously governed equity trading at the Exchange.
Background
    In September 2008, NYSE Euronext acquired the American Stock 
Exchange LLC (``Amex'').\5\ As part of the integration of the 
companies, in December 2008, the Exchange relocated trading in its 
listed equity securities from Amex's trading floor located at 86 
Trinity Place in New York to the New York Stock Exchange's (``NYSE'') 
trading floor located at 11 Wall Street, and adapted the NYSE equities 
trading platform to trade those securities. The Exchange also adopted 
equity trading rules for NYSE MKT based on the NYSE's equities trading 
rules.\6\ By their terms, the Exchange's new equities trading rules 
superseded the AEMI rules (and certain other Amex rules that were

[[Page 71847]]

inconsistent with the new rules) for all trading in Exchange-listed 
equity securities.\7\
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    \5\ See Securities Exchange Act Release No. 58673 (September 29, 
2008), 73 FR 57707 (October 3, 2008) (SR-Amex-2008-62 and SR-NYSE-
2008-60).
    \6\ See Securities Exchange Act Release No. 58705 (October 1, 
2008), 73 FR 58995 (October 8, 2008) (SR-Amex-2008-63) (Order 
Granting Approval of Proposed Rule Change to Establish New 
Membership, Member Firm Conduct, and Equity Trading Rules Following 
the Exchange's Acquisition by NYSE Euronext).
    \7\ See NYSE MKT Rule 0(b) and NYSE MKT Rule 0--Equities.
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    Specifically, pursuant to Rule 0(b), all transactions conducted on 
or through the systems and facilities of the NYSE are governed by the 
Equities Rules in accordance with Rule 0-Equities. Rule 0-Equities 
further provides that the Equities Rules govern all transactions 
conducted on the Equities Trading System, i.e., the systems operated by 
the NYSE.
Proposed Rule Deletions
    The following identifies by category the legacy Amex, now NYSE MKT 
Rules that can be deleted in their entirety as obsolete and out-dated:
AEMI Rules
    Many of the rules being proposed for deletion relate to the 
``Auction & Electronic Market Integration'' (``AEMI'') platform, which 
Amex operated from September 2006 to November 2008 for trading of 
listed equity securities. The so-called AEMI rules were adopted in 
September 2006 in conjunction with the rollout of the AEMI trading 
system.\8\ As noted in Rule 0(a), the AEMI rules governed trading on 
the systems formerly located at 86 Trinity Place, which are no longer 
operating. NYSE MKT is now proposing to delete the AEMI rules on the 
basis that the system that they govern is no longer operative.\9\
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    \8\ See Securities Exchange Act Release No. 54552 (Sept. 29, 
2006), 71 FR 59546 (Oct. 10, 2006) (SR-Amex-2005-104).
    \9\ See NYSE MKT Rules 1-AEMI through 719-AEMI and AEMI-One 
Rules.
    Although the Exchange is proposing to delete most of the AEMI 
rules, it is retaining certain rules that contain definitions that 
are relevant to current listing and trading in Portfolio Depository 
Receipts (Rule 1000-AEMI); Index Fund Shares (Rule 1000A-AEMI); 
Rules of General Applicability (relating to trading of Trust Issued 
Receipts) (Rule 1200-AEMI); Commodity-Based Trust Shares (Rule 
1200A-AEMI); Currency Trust Shares (Rule 1200B-AEMI); and Trading of 
Partnership Units (Rule 1500-AEMI). The Exchange intends to review 
the placement of these rules, and their possible relocation, in a 
subsequent phase of its rule review project. In addition, the 
Exchange is not proposing to delete NYSE MKT Rule 910--AEMI until 
such time that the Amex Company Guide is similarly updated to 
reflect the appropriate cross reference.
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Rules That Were Superseded by Aemi but never deleted
    The AEMI system was rolled out in phases starting in 2006. Although 
the AEMI rules were intended to supersede the Amex's then-existing 
equities trading rules, certain of those equities trading rules were 
left in place pending the completion of the AEMI rollout, and upon 
completion, were to have been deleted via a rule filing with the 
Commission.\10\ To the best of the Exchange's knowledge, that filing 
was never made. Because of the provision in the AEMI rules making those 
rules definitively obsolete, the adoption of new equities trading rules 
in December 2008, and the fact that those rules are no longer 
consistent with current Exchange systems, the Exchange proposes to 
delete those enumerated rules now in order to avoid any confusion 
within the rulebook.\11\ For example, NYSE MKT Rule 100 is now 
addressed in NYSE MKT Rule 51- Equities (for equities trading) and NYSE 
MKT Rule 901NY (for options trading). As another example, NYSE MKT Rule 
108, which governs priority and parity at openings for equities 
trading, is now governed by NYSE MKT Rules 72--Equities and 115A--
Equities. In summary, the rules being deleted are now all covered in 
the equities rules that govern trading at the Exchange.\12\
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    \10\ See Section (e) of NYSE MKT Rule 1A-AEMI.
    \11\ See NYSE MKT Rules 100, 108, 109, 110, 112, 115, 118, 119, 
123, 124, 126, 127, 131, 131A, 132, 135, 135A, 151, 152, 153, 154, 
155, 156, 157, 178, 179, 200, 205, 206 and 207.
    \12\ See supra, notes 6 and 7.
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Equities Trading Rules That Are Superseded by Later-Adopted Trading 
Rules
    As noted above, in connection with its integration into NYSE 
Euronext, the Exchange adopted new equities trading rules based on the 
NYSE equities trading rules. Because the rules were adopted while NYSE 
MKT continued to operate at the 86 Trinity Place location, the Exchange 
did not simultaneously delete previous rules that were being superseded 
by the new equities trading rules. Instead, the Exchange adopted Rule 
0- Equities, which explained that the new rules superseded any of the 
old rules that were inconsistent. For the sake of clarity, the Exchange 
now proposes to delete the former Amex equities trading rules that, 
pursuant to Rule 0-Equities are now superseded by the equities 
rules.\13\
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    \13\ See NYSE MKT Rules 5, 6, 7, 8, 9, 10, 13, 14, 15, 16, 17, 
18, 19, 20, 23, 25, 26, 27, 28, 29, 30A, 60, 62, 63, 101, 102, 103, 
104, 105, 106, 107, 111, 114, 116, 117, 117A, 119A, 120, 121, 122, 
125, 128, 129, 130, 133, 134, 136, 140, 150, 153A, 176, 177, 180, 
181, 182, 183, 184, 185, 186, 187, 188, 189, 190, 191, 192, 193, 
201, 202, 203, 204 and 208.
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After-Hours Trading Rules
    Since the integration of the Exchange into NYSE Euronext, the 
Exchange has conducted its after-hours trading through the NYSE's 
trading systems, and consequently adopted a version of the NYSE's 
after-hours trading rules.\14\ Because the Exchange has adopted 
superseding rules for after-hours trading, the Exchange proposes to 
delete the prior set of rules relating to after-hours trading.\15\
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    \14\ See NYSE MKT Rules 900-Equities--907-Equities.
    \15\ See NYSE MKT Rules 1300 through 1306.
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Cross-References
    The Exchange is also proposing to amend those rules that cross-
reference rules that are being deleted pursuant to this filing.\16\
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    \16\ See NYSE MKT Rules 905G and Commentary .02 to 906.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\17\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\18\ in particular, in that, by deleting obsolete 
and out-dated rules, it promotes just and equitable principles of 
trade, removes impediments to and perfects the mechanism of a free and 
open market and a national market system, and, in general, helps to 
protect investors and the public interest by providing transparency as 
to which rules are operable and reducing potential confusion that may 
result from having obsolete or out-dated rules in the Exchange's 
rulebook. The Exchange further believes that the proposal removes 
impediments to and perfects the mechanism of a free and open market by 
ensuring that members, regulators and the public can more easily 
navigate the Exchange's rulebook and better understand what obligations 
attach and when.
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    \17\ 15 U.S.C. 78f(b)
    \18\ 15 U.S.C. 78f(b)(5)
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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 solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule does not (i) Significantly 
affect the protection of investors or the public

[[Page 71848]]

interest; (ii) impose any significant burden on competition; and (iii) 
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, provided that the 
self-regulatory organization has given the Commission written notice of 
its intent to file 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 proposed rule change has 
become effective pursuant to Section 19(b)(3)(A) of the Act \19\ and 
Rule 19b-4(f)(6) thereunder.\20\
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    \19\ 15 U.S.C. 78s(b)(3)(A).
    \20\ 17 CFR 240.19b-4(f)(6).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend 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 email to rule-comments@sec.gov. Please include 
File Number SR-NYSEMKT-2012-68 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-NYSEMKT-2012-68. This 
file number should be included on the subject line if email 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 Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 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-NYSEMKT-2012-68 and should 
be submitted on or before December 26, 2012.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
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    \21\ 17 C.F.R. 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-29216 Filed 12-3-12; 8:45 am]
BILLING CODE 8011-01-P