Document ID: SEC-2011-0739-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Amex LLC
Posted Date: 2011-05-25T04:00Z

[Federal Register: May 25, 2011 (Volume 76, Number 101)]
[Notices]               
[Page 30411-30412]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr25my11-135]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64519; File No. SR-NYSEAmex-2011-33]

 
 Self-Regulatory Organizations; NYSE Amex LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Permit the 
Listing of Additional Expiration Months if Such Expiration Months Are 
Listed on Another Exchange

DATES: May 19, 2011.
    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 May 6, 2011, NYSE Amex LLC (the ``Exchange'' or ``NYSE Amex'') 
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 NYSE Amex. 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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to adopt Commentary .14 to NYSE Amex Rule 903 
to permit the listing of additional expiration months if such 
expiration months are listed on another exchange. The text of the 
proposed rule change is available at the Exchange's principal office, 
at http://www.nyse.com, the Commission's Public Reference Room, and at 
the Commission's Web site at http://www.sec.gov.

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 purpose of this proposed rule change is to permit the Exchange 
to list additional expiration months if such expiration months are 
listed on another exchange. This filing is based on a filing previously 
submitted by the International Securities Exchange LLC.\3\
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    \3\ See Exchange Act Release No. 64343 (April 26, 2011) 76 FR 
24546 (May 2, 2011).
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    Under current Rule 903(b), NYSE Amex usually will open four (4) 
expiration months for each type of option of a class of options open 
for trading on the Exchange: The first two (2) being the two nearest 
months, regardless of the quarterly cycle on which that class trades; 
the third and fourth month being the next two months of the quarterly 
cycle previously designated by the Exchange for the specific class. For 
example, if the Exchange listed in late September a new stock option on 
a January-April-July-October quarterly cycle, the Exchange would list 
the two nearest term months (October and November) and the next two 
expiration months of the cycle (January and April). Further, when the 
October series expire, the Exchange would add the December series as 
the next nearest month. And when the November series expire, the 
Exchange would add the July series as the next month of the cycle.
    In 2010, the Exchange established a pilot program to add up to the 
two additional expiration months for each class of options opened for 
trading on the Exchange (the ``Additional Expiration Months 
Pilot'').\4\ Under the Additional Expiration Months Pilot, NYSE Amex 
lists expiration months that are considered ``mid-month''. For example, 
for options classes that have expiration months of October, November, 
February, and May, the Exchange lists the December and January series. 
The listing of additional expiration months has been well received by 
ATP Holders, and has had very limited impact on system resources.
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    \4\ See Exchange Act Release No. 63170 (October 25, 2010) 75 FR 
66818 (October 29, 2010).
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    ISE recently submitted a filing in response to a filing by NASDAQ 
OMX PHLX, Inc. (``PHLX'').\5\ PHLX amended its rules so that it can 
open ``at least one expiration month'' for each class of standard 
options open for trading on that exchange. Consequently, while NYSE 
Amex is currently restricted to listing a limited number of expiration 
months that are permissible under its rules and the Additional Months 
Expiration Months Pilot, PHLX has the ability to list expiration months 
that NYSE Amex would not be able to list under its rules. Indeed, PHLX 
has listed additional expiration months that no other exchange could 
list at the time they were added (ISE listed matching series only on 
April 28, 2011, effective for trading April 29, 2011). For example, in 
January 2011, PHLX listed the October 2011 expiration in Omnicare, Inc. 
(ticker: OCR). Meanwhile, NYSE Amex could not list the October 2011 
series under Rule 903(b) because the standard expiration months for OCR 
at the time were February, March, June, and September. NYSE Amex could 
not list the October 2011series as part of the Additional Expiration 
Months Pilot because OCR is not one of the classes selected by the 
Exchange to participate in the Additional Expiration Months Pilot. As a 
result, PHLX was the only exchange that listed the October 2011 series 
in OCR and, until April 29, 2011, continued to trade those series 
without competition.
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    \5\ See Securities Exchange Act Release No. 63700 (January 11, 
2011) 76 FR 2931 (January 18, 2011) (SR-PHLX-2011-04). In its 
filing, PHLX cites to the Commission's approval of the NASDAQ 
Options Market (``NOM'') and rules pertaining thereto as the basis 
for making the change to its rules.
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    For competitive reasons, NYSE Amex now proposes to add new 
Commentary .14 to its Rule 903 and new Commentary .08 to its Rule 903C 
to permit the Exchange to list additional expiration months on options 
classes opened for trading on the Exchange if such expiration months 
are opened on at least one other national securities exchange, 
identical to the provision recently added by ISE.\6\ This proposed rule 
change will allow NYSE Amex to match the listing of expiration months 
that PHLX or NOM lists in the event NYSE Amex is not able to list those 
expiration months because they do not comport to NYSE Amex Rules or the 
Additional Months Expiration Pilot.
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    \6\ See Note 4.
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    The Exchange notes that the proposed rule change affords additional 
flexibility in that it will permit the exchange to list those 
additional expiration months that have an actual demand from market 
participants thereby potentially reducing the proliferation of classes 
and series. The Exchange believes the

[[Page 30412]]

proposed rule change is proper, and indeed necessary, in light of the 
need to have rules that permit the listing of identical expiration 
months across exchanges for products that are multiply listed and 
fungible with one another. The Exchange believes that the proposed rule 
change should encourage competition and be beneficial to traders and 
market participants by providing them with a means to trade on the 
Exchange securities that are listed and traded on other exchanges.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Securities Exchange Act of 1934 \7\ (the ``Act'') in 
general, and furthers the objectives of Section 6(b)(5) of the Act \8\ 
in particular, in that it is 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. In particular, the 
proposed rule change will permit the Exchange to accommodate requests 
made by its permit holders and other market participants to list the 
additional expiration months and thus encourage competition without 
harming investors or the public interest.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 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 change does not significantly 
affect the protection of investors or the public interest, does not 
impose any significant burden on competition, and, 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, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \9\ and Rule 19b-
4(f)(6) thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's 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 
Commission has waived the five-day prefiling requirement in this 
case.
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    The Exchange has requested that the Commission waive the 30-day 
operative delay. The Commission believes that waiver of the operative 
delay is consistent with the protection of investors and the public 
interest because the proposal should promote competition by allowing 
the Exchange to list and trade option series that are trading on other 
options exchanges without undue delay. Therefore, the Commission 
designates the proposal operative upon filing.\11\
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    \11\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the 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 e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEAmex-2011-33 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-NYSEAmex-2011-33. 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 website 
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 a.m. and 3 p.m. Copies of the 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-
NYSEAmex-2011-33 and should be submitted on or before June 15, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-12874 Filed 5-24-11; 8:45 am]
BILLING CODE 8011-01-P