Document ID: SEC-2006-1349-0001
Agency: sec
Document Type: Notice
Title: Applications, hearings, determinations, etc.: Consolidated Tape Association
Posted Date: 2006-10-18T04:00Z

[Federal Register: October 18, 2006 (Volume 71, Number 201)]
[Notices]               
[Page 61517-61518]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18oc06-104]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54588; File No. SR-CTA/CQ-2006-02]

 
Consolidated Tape Association; Notice of Filing and Immediate 
Effectiveness of the Tenth Substantive Amendment to the Second 
Restatement of the Consolidated Tape Association Plan and the Seventh 
Substantive Amendment to the Restated Consolidated Quotation Plan

October 11, 2006.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 608 thereunder,\2\ notice is hereby given that 
on September 18, 2006, the Consolidated Tape Association (``CTA'') Plan 
and Consolidated Quotation (``CQ'') Plan participants 
(``Participants'') \3\ submitted to the Securities and Exchange 
Commission (``Commission'') proposals to amend the CTA and CQ Plans 
(collectively, the ``Plans'').\4\ The proposals represent the tenth 
substantive amendment made to the Second Restatement of the CTA Plan 
(``Tenth Amendment to the CTA Plan'') and the seventh substantive 
amendment to the Restated CQ Plan (``Seventh Amendment to the CQ 
Plan''), and reflect changes unanimously adopted by the participants. 
The Tenth Amendment to the CTA Plan and the Seventh Amendment to the CQ 
Plan (``Amendments'') would modify the procedures for entering into 
arrangements for pilot test operations. In addition, these amendments 
would exclude pilot test operations from the requirement that any 
change in the charges set forth in Exhibit E to the respective Plans be 
effected by a Plan amendment.
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ Each Participant executed the proposed amendments. The 
current Participants are the American Stock Exchange LLC (``Amex''); 
Boston Stock Exchange, Inc. (``BSE''); Chicago Board Options 
Exchange, Incorporated (``CBOE''); Chicago Stock Exchange, Inc. 
(``CHX''); National Association of Securities Dealers, Inc. 
(``NASD''); National Stock Exchange (``NSX''); New York Stock 
Exchange LLC (``NYSE''); NYSE Arca, Inc. (``NYSE Arca''); and 
Philadelphia Stock Exchange, Inc. (``Phlx'').
    \4\ See Securities Exchange Act Release Nos. 10787 (May 10, 
1974), 39 FR 17799 (order approving CTA Plan); 15009 (July 28, 
1978), 43 FR 34851 (August 7, 1978) (order temporarily approving CQ 
Plan); and 16518 (January 22, 1980), 45 FR 6521 (order permanently 
approving CQ Plan). The most recent restatement of both Plans was in 
1995. The CTA Plan, pursuant to which markets collect and 
disseminate last sale price information for listed securities, is a 
``transaction reporting plan'' under Rule 601 under the Act, 17 CFR 
242.601, and a ``national market system plan'' under Rule 608 under 
the Act, 17 CFR 242.608. The CQ Plan, pursuant to which markets 
collect and disseminate bid/ask quotation information for listed 
securities, is also a ``national market system plan'' under Rule 608 
under the Act, 17 CFR 242.608.
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    Pursuant to Rule 608(b)(3)(ii) under the Act,\5\ the Participants 
designated the Amendments as concerned solely with the administration 
of the Plans. As a result, the Amendments have become effective upon 
filing with the Commission. At any time within 60 days of the filing of 
the amendments, the Commission may summarily abrogate the Amendments 
and require that the Amendments be re-filed in accordance with 
paragraph (a)(1) of Rule 608 and reviewed in accordance with paragraph 
(b)(2) of Rule 608, if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or the maintenance of fair and orderly markets, to remove 
impediments to, and perfect the mechanisms of, a national market system 
or otherwise in furtherance of the purposes of the Act. The Commission 
is publishing this notice to solicit comments from interested persons.
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    \5\ 17 CFR 242.608(b)(3)(ii).
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I. Description and Purpose of the Proposed Amendments

A. Application of Pilot Test Procedures

    The Amendments propose to modify the procedures that apply to the 
entrance into arrangements for pilot test operations and to explicitly 
exclude pilot test operations from the relevant Plan provisions which 
require any change in the charges set forth in the Plans to be effected 
by an amendment.
    Currently, the Plans permit a network's administrator to enter into 
arrangements with vendors and other persons for pilot test operations 
designed to develop, or to permit the development of, new last sale 
price information services and uses and new quotation information 
services and uses, as relevant, without the need for agreements with, 
and collection of charges from, customers of such vendors or other 
persons. In order to enter into such arrangements, a network 
administrator, acting on behalf of the Participants, must promptly 
report the commencement of each arrangement and, upon an arrangement's 
conclusion, any market research obtained from the pilot test operations 
to CTA or the Operating Committee, as relevant. The arrangements are 
exempt from certain provisions in the Plans regarding the form of, and 
necessity for, agreements with recipients of last sale price and 
quotation information, as relevant, and the amount and incidence of 
charges.
    The Amendments propose to require that a network's administrator 
act with the concurrence of a majority of Participants, not merely on 
behalf of such Participants, in order to enter into arrangements for 
pilot test operations. Further, a network's administrator will be 
required to also report the commencement of each arrangement and any 
market research obtained from the pilot test operations to the SEC.
    Finally, the Amendments propose to clarify that pilot test 
operations are exempt from the Plans' provisions regarding the 
establishment and amendment of charges. The provisions require any 
additions, deletions, or modifications to any of the charges set forth 
in Exhibit E to the Plans to be effected by an amendment to the Plans. 
Amendments to Exhibit E are subject to voting and other procedural 
requirements. Pursuant to the Amendments, charges imposed in connection 
with arrangements for pilot test operations will not constitute an 
addition, deletion, or modification to the charges set forth in Exhibit 
E and, as a result, do not require a Plan amendment. The text of the 
proposed Amendments is available on the CTA's Web site (http://www.nysedata.com/cta
), at the principal office of the CTA, and at the 

Commission's Public Reference Room.

B. Additional Information Required by Rule 608(a)

1. Governing or Constituent Documents
    Not applicable.
2. Implementation of Amendments
    The Participants have manifested their approval of the proposed 
Amendments by means of their execution of the Amendments. The 
Amendments have become effective upon filing.\6\
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    \6\ See id.
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3. Development and Implementation Phases
    Not applicable.

[[Page 61518]]

4. Analysis of Impact on Competition
    The Participants believe that the proposed amendments do not impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. The Participants do not believe 
that the proposed amendments introduce terms that are unreasonably 
discriminatory for the purposes of Section 11A(c)(1)(D) of the Act.
5. Written Understanding or Agreements Relating to Interpretation of, 
or Participation in, Plan
    Not applicable.
6. Approval by Sponsors in Accordance With Plan
    Each of the Participants has approved the Amendments in accordance 
with Section IV(b) of the CTA Plan and Section IV(c) of the CQ Plan, as 
applicable.
7. Description of Operation of Facility Contemplated by the Proposed 
Amendment
    Not applicable.
8. Terms and Conditions of Access
    Not applicable.
9. Method of Determination and Imposition, and Amount of Fees and 
Charges
    Not applicable.
10. Method of Frequency of Processor Evaluation
    Not applicable.
11. Dispute Resolution
    Not applicable.

C. Additional Information Required by Rule 601(a) (Solely With Respect 
to the Tenth Amendment to the CTA Plan)

1. Reporting Requirements
    Not applicable.
2. Manner of Collecting, Processing, Sequencing, Making Available and 
Disseminating Last Sale Information
    Not applicable.
3. Manner of Consolidation
    Not applicable.
4. Standards and Methods Ensuring Promptness, Accuracy and Completeness 
of Transaction Reports
    Not applicable.
5. Rules and Procedures Addressed to Fraudulent or Manipulative 
Dissemination
    Not applicable.
6. Terms of Access to Transaction Reports
    Not applicable.
7. Identification of Marketplace Execution
    Not applicable.

II. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed 
Plans amendments are 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 rule-comments@sec.gov. Please include 

File No. SR-CTA/CQ-2006-02 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090.

All submissions should refer to File No. SR-CTA/CQ-2006-02. 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 Plan amendment that are 
filed with the Commission, and all written communications relating to 
the proposed Plan amendment 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. Copies of the 
filing also will be available for inspection and copying at the 
principal office of the CTA. 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-CTA/CQ-2006-02 and should be submitted on or before 
November 8, 2006.
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    \7\ 17 CFR 200.30-3(a)(27).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E6-17315 Filed 10-17-06; 8:45 am]

BILLING CODE 8011-01-P