Document ID: SEC-2007-0677-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: American Stock Exchange LLC
Posted Date: 2007-05-14T04:00Z

[Federal Register: May 14, 2007 (Volume 72, Number 92)]
[Notices]               
[Page 27155-27156]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr14my07-65]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55719; File No. SR-Amex-2006-17]

 
Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing of Amendment Nos. 3 and 4 Relating to Procedures for 
At-Risk Cross Transactions

 May 7, 2007.
    On February 17, 2006, the American Stock Exchange LLC (``Amex'' or 
``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 
proposed rule change to adopt a new crossing procedure, the ``at-risk 
cross,'' as an alternative to the Exchange's existing facilitation 
cross procedure. On November 9, 2006, the Exchange filed Amendment No. 
1 to the proposed rule change, and on December 1, 2006, the Exchange 
filed Amendment No. 2 to the proposed rule change. The proposed rule 
change, as modified by Amendment Nos. 1 and 2, was published for 
comment in the Federal Register on January 17, 2007.\3\ On March 28, 
2007, the Exchange filed Amendment No. 3 to the proposed rule change, 
and on May 3, 2007, the Exchange filed Amendment No. 4 to the proposed 
rule change. Amendment Nos. 3 and 4 are described in Item II below. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended by Amendment Nos. 3 and 4, from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 55068 (January 9, 
2007), 72 FR 2044 (``Notice'').
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Amex proposes to revise the procedures applicable to cross 
transactions in equity options to provide procedures for at-risk cross 
transactions. The text of the proposed rule change is available at the 
Amex, on the Amex's Web site at http://amex.com, 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 Amex 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 these statements may be examined at the places specified in 
Item IV below.

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

1. Purpose
    The Exchange proposes to provide an alternative crossing procedure 
to supplement the existing facilitation cross procedure in Commentary 
.02 to Amex Rule 950-ANTE(d). In this manner, the Amex would permit 
``at-risk'' cross transactions by member firms. A complete description 
and statement of purpose of the proposed rule change, as modified by 
Amendment Nos. 1 and 2, may be found in the notice of filing previously 
published for comment in the Federal Register.\4\
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    \4\ See Notice, supra note 3.
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    In Amendment No. 3, the Exchange made technical and clarifying 
changes to the proposal \5\ and stated that the proposed at-risk cross 
procedure would not apply to options classes that are part of the 
Exchange's options penny pilot

[[Page 27156]]

program.\6\ In Amendment No. 4, the Exchange proposes to allow the 
proposed at-risk crossing procedure to apply to options classes that 
are part of the options penny pilot program.\7\
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    \5\ Specifically, the Exchange made a clarifying change to the 
language of Commentary .03(vii) to Amex Rule 950-ANTE(d). The 
Exchange also confirmed that if a public customer order either on 
the book or represented in the trading crowd has priority over the 
at-risk cross, the member firm would be permitted to participate 
only in those contracts remaining after the public customer's order 
has been filled. Further, the Exchange represented that if there is 
a public customer order on the book or represented in the trading 
crowd on the same side of the market as, and priced at or better 
than, the public customer order that is part of the at-risk cross, 
the public customer order on the book or represented in the trading 
crowd would have priority.
    \6\ See Securities Exchange Act Release No. 55162 (January 24, 
2007), 72 FR 4738 (February 1, 2007) (SR-Amex-2006-106).
    \7\ In addition, Amendment No. 4 makes non-substantive rule text 
changes and shows the text of the final proposal as marked against 
the current text of Amex Rule 950-ANTE(d).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6 of the Act \8\ in general and furthers the objectives of 
Section 6(b)(5) \9\ in particular in that it is designed to perfect the 
mechanisms of a free and open market and the national market system, 
protect investors and the public interest, to foster cooperation and 
coordination with persons engaged in facilitating transactions in 
securities and promote just and equitable principles of trade.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change will 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

    No written comments were solicited or received by the Exchange on 
this proposal.

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the Exchange consents, the Commission will:
    (A) By order approve such proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

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-Amex-2006-17 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-Amex-2006-17. 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-Amex-2006-17 and should be submitted on or before May 29, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-9176 Filed 5-11-07; 8:45 am]

BILLING CODE 8010-01-P