Document ID: SEC-2007-0133-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: International Securities Exchange, LLC
Posted Date: 2007-01-26T05:00Z

[Federal Register: January 26, 2007 (Volume 72, Number 17)]
[Notices]               
[Page 3888-3889]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26ja07-154]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55140; File No. SR-ISE-2006-71]

 
Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change Relating to Rule 2113 (Long and Short Sales)

 January 19, 2007.
    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 November 30, 2006, the International Securities Exchange, LLC 
(``ISE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been prepared substantially by 
the Exchange. The Exchange filed the proposed rule change as a ``non-
controversial'' rule change under Rule 19b-4(f)(6) under the Act,\3\ 
which rendered the proposal effective upon filing with the Commission. 
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\ 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 is proposing to amend ISE Rule 2113 (Long and Short 
Sales) to expand the scope of the rule. The text of the proposed rule 
change is available at the Exchange, the Commission's Public Reference 
Room, and http://www.iseoptions.com.

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 Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposal. The text of these 
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 aspects of such statements.

[[Page 3889]]

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On August 31, 2006, the ISE was granted approval to adopt a rule 
governing short sales on the ISE Stock Exchange.\4\ Currently, the only 
order types that can be entered on the ISE Stock Exchange are orders 
that indicate an interest for price improvement in Midpoint Match, 
e.g., Standard Orders and Solicitations of Interest.\5\ The ISE short 
sale rule, as approved, is limited only to these order types. The ISE 
Stock Exchange will be rolling out additional order types for equity 
Electronic Access Members (``Equity EAMs'') to submit to the ISE Stock 
Exchange's displayed market.
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    \4\ See Securities Exchange Act Release No. 54398, 71 FR 53727 
(September 12, 2006) (SR-ISE-2006-42).
    \5\ See ISE Rule 2129.
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    The purpose of the proposed rule change is to amend the ISE's short 
sale rule (Rule 2113--Long and Short Sales) to expand its scope to 
cover all other order types that will be available to Equity EAMs.\6\
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    \6\ See ISE Rule 2104.
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2. Statutory Basis
    The basis under the Act for this proposed rule change is found in 
Section 6(b)(5). Specifically, the Exchange believes the proposed rule 
change is consistent with Section 6(b)(5) requirements that the rules 
of an 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.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change would impose no 
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

    The Exchange did not solicit or receive any written comments with 
respect to the proposal.

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

    Because the proposed rule change: (i) Does not significantly affect 
the protection of investors or the public interest; (ii) does not 
impose any significant burden on competition; and (iii) by its terms, 
does not become operative for 30 days after the date of filing, or such 
shorter time as the Commission may designate, if consistent with the 
protection of investors and the public interest, the proposed rule 
change has become effective pursuant to Section 19(b)(3)(A) of the Act 
\7\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\8\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6).
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    As required under Rule 19b-4(f)(6)(iii),\9\ the Exchange provided 
the Commission with written notice of its 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 the 
filing of the proposed rule change. The Exchange has requested that the 
Commission waive the 30-day operative delay. The Commission believes 
that waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest, in order that all 
short sales on the ISE Stock Exchange, including new order types to be 
available to Equity EAMs, comply with the requirements of ISE Rule 
2113. For this reason, the Commission designates the proposal to be 
effective and operative upon filing.\10\
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    \9\ 17 CFR 240.19b-4(f)(6)(iii).
    \10\ For the purposes only of waiving the operative delay, the 
Commission has considered the proposed rule's impact on efficiency, 
competition and capital formation. 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 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 the furtherance of the purposes of the Act.\11\
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    \11\ See 15 U.S.C. 78s(b)(3)(C).
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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-ISE-2006-71 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 Number SR-ISE-2006-71. 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. 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-ISE-2006-71 and should be submitted on or before 
February 16, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-1219 Filed 1-25-07; 8:45 am]

BILLING CODE 8011-01-P