Document ID: SEC-2009-0167-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: New York Stock Exchange LLC
Posted Date: 2009-02-05T05:00Z

[Federal Register: February 5, 2009 (Volume 74, Number 23)]
[Notices]               
[Page 6188-6189]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05fe09-65]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59327; File No. SR-NYSE-2009-09]

 
Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Implementing an Equity Transaction Fee for Shares Executed on or 
Through the New York Block Exchange Effective Upon Filing With the 
Commission

January 30, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on January 28, 2009, New York Stock Exchange LLC (``NYSE'' 
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 self-
regulatory organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to implement an equity transaction fee 
effective January 29, 2009, for shares executed on the New York Block 
Exchange SM (``NYBX'' or the ``Facility'').\4\ The Exchange 
will charge each Member Organization $.0025 per share executed on the 
NYBX.
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    \4\ See Securities Exchange Act Release No. 59281 (January 22, 
2008) 74 FR 5014 (January 28, 2009) (SR-NYSE-2008-120) and 
Securities Exchange Act Release No. 59282 (January 22, 2009), 74 FR 
5009 (January 28, 2009) (SR-NYSE-2008-119).
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    The text of the proposed rule change is available at http://
www.nyse.com, the Exchange, 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 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 implement an equity transaction fee for 
executions on or through the New York Block Exchange system with effect 
from the scheduled launch date of January 29, 2009. The NYBX will be an 
electronic facility of the Exchange to provide for the continuous 
matching and execution of securities listed on the NYSE of all non-
displayed orders with the aggregate of all displayed and non-displayed 
orders of the NYSE Display Book[supreg] (``Display Book'' or ``DBK'') 
while also considering protected quotations of all automated trading 
centers (``away markets''). The proposed transactional fee of $.0025 
per executed share will be charged to both the buyer(s) and seller(s) 
of the executed shares. The fee will be charged for all executions of 
NYBX orders, including those NYBX executions that take place in the DBK 
or

[[Page 6189]]

in away markets. Only NYSE members, member organizations and sponsoring 
member organizations will be charged this transaction fee. Transaction 
fees for executions of orders entered by sponsored participants will be 
charged to the sponsoring member organization.
    The following example will demonstrate how the proposed NYBX 
transactional fee will be charged:
    Example No 1:
    User A enters a buy order into NYBX for 10,000 shares of XYZ 
security. User B enters a sell order into NYBX for 10,000 shares of XYZ 
security. User A's buy order for 10,000 shares of XYZ security and User 
B's sell order for 10,000 shares of XYZ security execute in or through 
NYBX. User A is charged $.0025 per executed share (10,000 shares x 
$.0025 = $25.00). User B is also charged $.0025 per executed share 
(10,000 shares x $.0025 = $25.00).
    NYBX Executions in the DBK or in Away Markets:
    The NYBX transactional fee will be charged for all executions of 
all orders entered into the NYBX facility, whether such executions take 
place in the NYBX facility, the DBK or in away markets. Therefore, in 
the example above, if the execution of 10,000 shares of XYZ security 
takes place within the NYBX facility, Users A and B would each be 
charged $.0025 per executed share (10,000 shares x $.0025 = $25.00). 
However, if Users A and B's NYBX orders are routed to the DBK for 
execution, and the execution of the orders take place in the DBK, Users 
A and B would each be charged $.0025 per executed share (10,000 shares 
x $.0025 = $25.00). Similarly, if Users A and B's NYBX orders are 
routed to away markets pursuant to Rule 611 of Regulation NMS, and the 
execution of the orders take place on the away markets, Users A and B 
would each be charged $.0025 per executed share (10,000 shares x $.0025 
= $25.00). Therefore, Users A and B will not pay any additional 
transactional fee for the execution of NYBX orders to the extent that 
an NYBX order or a portion thereof may be executed in the DBK or in the 
away markets.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 \5\ of the Securities Exchange Act of 
1934 (the ``Act'') \6\ in general and Section 6(b)(4) of the Act \7\ in 
particular, in that it provides for the equitable allocation of 
reasonable dues, fees and other charges among its members and other 
persons using its facilities. Specifically, the proposed transaction 
fee is reasonable in light of the costs incurred by the Exchange for 
the operation of the NYBX system. Further, the NYBX fee is consistent 
with some exchanges' fees and lower than other exchanges' fees for 
removal of liquidity. For example, the BATS Exchange, Inc. fee for 
removal of liquidity is $.0025 per execution,\8\ while the Nasdaq \9\ 
and International Securities Exchange (``ISE'') \10\ fee is $.0030, 
NYSE Arca is $.0029 \11\ and Direct Edge is $.0026.\12\ Additionally, 
the transaction fee is equitable as the fee is applied to all users of 
the NYBX system equally.
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    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78a.
    \7\ 15 U.S.C. 78f(b)(4).
    \8\ See the BATS Exchange, Inc. Price List for 2009.
    \9\ See the Nasdaq Price List for 2009.
    \10\ See the International Securities Exchange Price List for 
2009.
    \11\ See the NYSE Arca Price List for 2009.
    \12\ See the Direct Edge Price List for 2009.
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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

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \13\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \14\ thereunder, because it establishes a due, fee, or other 
charge imposed by NYSE. 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 interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(2).
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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 rule-comments@sec.gov. Please include 
File Number SR-NYSE-2009-09 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-NYSE-2009-09. 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 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-NYSE-2009-09 and should be 
submitted on or before February 26, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-2429 Filed 2-4-09; 8:45 am]

BILLING CODE 8011-01-P