Document ID: SEC-2007-0393-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: NYSE Arca, Inc.
Posted Date: 2007-03-16T04:00Z

[Federal Register: March 16, 2007 (Volume 72, Number 51)]
[Notices]               
[Page 12654-12655]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr16mr07-115]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55442; File No. SR-NYSEArca-2007-09]

 
Self-Regulatory Organizations; NYSE Arca, Inc.; Order Granting 
Approval of Proposed Rule Change Relating to the Expansion of Business 
Activities of Archipelago Securities, L.L.C.

March 12, 2007.

I. Introduction

    On January 25, 2007, the NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposal to allow Archipelago Securities, L.L.C. (``Archipelago 
Securities'') to act as a marketing agent on behalf of the NYSE Arca 
Tech 100 Index (the ``Index'') and the NYSE Arca Tech 100 ETF (the 
``ETF'') and provide reasonable services attendant thereto. The 
proposed rule change was published for comment in the Federal Register 
on February 9, 2007.\3\ The Commission received no comments regarding 
the proposal. This order approves the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 55232 (February 2, 
2007), 72 FR 6308.
---------------------------------------------------------------------------

II. Description of the Proposal

    Archipelago Securities \4\ succeeded Wave Securities, L.L.C. 
(``Wave''), which was approved by the Commission to operate as a 
facility of the Exchange,\5\ and assumed some of Wave's duties, 
including Wave's function as the outbound router for the Exchange. 
Pursuant to the order approving rule changes proposed by the Exchange 
in connection with the acquisition of the Exchange (formerly Pacific 
Exchange, Inc.) by Archipelago Holdings, Inc., now the parent company 
of the Exchange, any expansion of the business activities of 
Archipelago Securities must be approved by the Commission.\6\
---------------------------------------------------------------------------

    \4\ Archipelago Securities is a registered broker-dealer, a 
member of several self-regulatory organizations including the NASD, 
and a facility of the Exchange.
    \5\ See Securities Exchange Act Release No. 44983 (October 25, 
2001), 66 FR 55225 (November 1, 2001) (SR-PCX-00-25).
    \6\ See Securities Exchange Act Release No. 52497 (September 22, 
2005), 70 FR 56949 (September 29, 2005) (SR-PCX-2005-90) 
(``Archipelago/PCX Acquisition Release'').
---------------------------------------------------------------------------

    NYSE Arca is now proposing to expand the business activities of 
Archipelago Securities to allow Archipelago Securities to act as a 
marketing agent on behalf of the Index and the ETF and provide 
reasonable services attendant thereto.\7\ In the proposal, the Exchange 
represents that as marketing agent for the Index and the ETF, 
Archipelago Securities will develop a marketing plan designed to 
advertise, promote, and increase public awareness of the Index and the 
ETF within the financial services industry and investing public 
(``Marketing Plan''), including: branding; promotional activities; 
development and design of marketing materials, collateral

[[Page 12655]]

and media campaigns (i.e., electronic media, print media, Internet, 
etc.); and hosting a Web site for the ETF. The Exchange also represents 
that this proposed marketing activity has no connection to Archipelago 
Securities' facility functions.
---------------------------------------------------------------------------

    \7\ Recently, the Commission approved the expansion of the 
business activities of Archipelago Securities to include, as a 
facility of the Exchange, the function of routing option orders for 
members of the Exchange. See Securities Exchange Act Release No. 
54238 (July 28, 2006), 71 FR 44758 (August 7, 2006) (SR-NYSEArca-
2006-13).
---------------------------------------------------------------------------

III. Discussion

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to a national securities 
exchange \8\ and, in particular, the requirements of Section 6 of the 
Act.\9\ Specifically, the Commission finds that the proposed rule 
change is consistent with Section 6(b)(5) of the Act,\10\ which 
requires, among other things, that the rules of a national securities 
exchange be designed to promote just and equitable principles of trade, 
to remove impediments to and perfect the mechanism of a free and open 
market and a national market system, and, in general, to protect 
investors and the public interest. The Commission finds that the 
proposed rule change also furthers the objectives of Section 6(b)(8) 
\11\ of the Act in that it does not impose any burden on competition 
not necessary or appropriate in furtherance of the purposes of the Act. 
Based on the Exchange's representation that this proposed marketing 
activity has no connection to Archipelago Securities' facility 
functions, the Commission believes that the proposal is consistent with 
the Act and the Archipelago/PCX Acquisition Release.
---------------------------------------------------------------------------

    \8\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. 15 U.S.C. 78c(f).
    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\12\ that the proposed rule change (SR-NYSEArca-2007-09) is hereby 
approved.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-4815 Filed 3-15-07; 8:45 am]

BILLING CODE 8010-01-P