Document ID: SEC-2006-0925-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: New York Stock Exchange LLC
Posted Date: 2006-07-21T04:00Z

[Federal Register: July 21, 2006 (Volume 71, Number 140)]
[Notices]               
[Page 41491-41493]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21jy06-86]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54140; File No. SR-NYSE-2006-48]

 
Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Extend the Moratorium on the Qualification and Registration of New 
Competitive Traders and New Registered Competitive Market Makers, 
Governed by NYSE Rules 110 and 107A, Respectively, for an Additional 
Six Months

July 13, 2006.
    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 June 30, 2006, the New York Stock Exchange LLC (``NYSE'' 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 by the Exchange. The Exchange 
has designated the proposed rule change as constituting a ``non-
controversial'' rule change under Section 19(b)(3)(A)(iii) of the 
Act,\3\ and Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal 
effective upon filing with the Commission. The Commission is publishing 
this notice to

[[Page 41492]]

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\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 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 proposes to extend for six months the present 
moratorium, as modified, related to the qualification and registration 
of Competitive Traders (``CTs'') pursuant to NYSE Rule 110 and 
Registered Competitive Market Makers (``RCMMs'') pursuant to NYSE Rule 
107A. The text of the proposed rule change is available on the NYSE's 
Web site (http://www.nyse.com), at the NYSE's Office of the Secretary, 

and at 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 Exchange included statements 
concerning the purpose of, and basis for, the proposed rule change. 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.

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

 1. Purpose
    The Exchange proposes to extend for six months the present 
moratorium, as modified, related to the qualification and registration 
of CTs pursuant to NYSE Rule 110 and RCMMs pursuant to NYSE Rule 107A.
    On September 22, 2005, the Exchange filed SR-NYSE-2005-63 \5\ 
(``Filing 2005-63'') with the Commission proposing to implement a 
moratorium on the qualification and registration of new CTs and RCMMS 
in order to allow the Exchange an opportunity to review the viability 
of CTs and RCMMs in the NYSE HYBRID MARKETSM (``Hybrid 
Market'').\6\
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    \5\ See Securities Exchange Act Release No. 52648 (October 21, 
2005), 70 FR 62155 (October 28, 2005) (SR-NYSE-2005-63).
    \6\ See Securities Exchange Act Release No. 53539 (March 22, 
2006), 71 FR 16353 (March 31, 2006) (SR-NYSE-2004-05).
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    Subsequent to the filing of Filing 2005-63, the Exchange filed SR-
NYSE-2006-11 \7\ (``Filing 2006-11'') proposing to modify the 
moratorium and grant RCMM firms the ability to replace a RCMM who 
relinquishes his or her registration and ceases to conduct business as 
a RCMM during the moratorium with a newly qualified and registered 
RCMM. The moratorium does not restrict RCMMs from joining any RCMM firm 
or becoming or remaining an independent RCMM. Neither does the 
moratorium restrict any RCMM firm from hiring any existing RCMMs. At 
that time, the Exchange represented to the Commission that it intended 
to complete its review regarding CTs and RCMMs by June 30, 2006.
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    \7\ See Securities Exchange Act Release No. 53549 (March 24, 
2006), 71 FR 16388 (March 31, 2006) (SR-NYSE-2006-11).
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    In this filing, the Exchange seeks to extend the moratorium as 
amended for an additional six months in order to include in its review 
the impact of the Hybrid Market with respect to CTs and RCMMs. 
Additional phases of the Hybrid Market will be rolled out later this 
year and the Exchange plans to include the new data that these phases 
will provide into its evaluation.
    The Exchange will issue an Information Memo announcing the 
extension of the moratorium. The review is currently estimated to be 
completed on or about December 31, 2006.
2. Statutory Basis
    The Exchange believes that the basis under the Act for this 
proposed rule change is the requirement under Section 6(b)(5) \8\ that 
an exchange have rules that are designed to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in regulating, clearing, settling, processing 
information with respect to, and facilitating transactions in 
securities, 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.
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    \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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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) does not become 
operative for 30 days after the date of the 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 \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). Pursuant to Rule 19b-4(f)(6)(iii) 
under the Act, the Exchange is required to give the Commission 
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 filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has requested that the Commission waive the 5-day pre-
filing notice requirement. The Commission has determined to waive 
this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally 
does not become operative prior to thirty days after the date of 
filing. NYSE requests that the Commission waive the 30-day operative 
delay, as specified in Rule 19b-4(f)(6)(iii), and designate the 
proposed rule change to become operative immediately. The Commission 
hereby grants the request. The Commission believes that waiving the 30-
day operative delay is consistent with the protection of investors and 
the public interest because the extension will give the Exchange time 
to fully study the future viability of CTs and RCMMs in order to 
improve their market.\12\ For these reasons, the Commission designates 
the proposed rule change as effective and operative immediately.
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    \11\ Id.
    \12\ For purposes only of waiving the operative delay for this 
proposal, 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 may summarily abrogate such proposed 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

[[Page 41493]]

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-2006-48 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSE-2006-48. 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 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-NYSE-2006-48 and should be submitted on or before August 11, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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 Jill M. Peterson,
 Assistant Secretary.
 [FR Doc. E6-11569 Filed 7-20-06; 8:45 am]

BILLING CODE 8010-01-P