Document ID: SEC-2009-0179-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Alternext US LLC
Posted Date: 2009-02-09T05:00Z

[Federal Register: February 9, 2009 (Volume 74, Number 25)]
[Notices]               
[Page 6447-6449]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09fe09-73]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59344; File No. SR-NYSEALTR-2009-03]

 
Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NYSE Alternext U.S. LLC Making 
Changes to Certain NYSE Alternext Equities Rules to Conform With 
Amendments to Corresponding Rules Recently Filed for Immediate 
Effectiveness by the New York Stock Exchange LLC and To Make Other 
Technical Changes

February 2, 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 23, 2009, NYSE Alternext U.S. LLC (the 
``Exchange'' or ``NYSE Alternext'') 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 
the self-regulatory organization. NYSE Alternext filed the proposed 
rule change pursuant to Section 19(b)(3)(A) of the Act \4\ and Rule 
19b-4(f)(6) thereunder,\5\ which renders it 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 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 (i) make changes to certain NYSE Alternext 
Equities Rules to conform with

[[Page 6448]]

amendments to corresponding rules recently filed for immediate 
effectiveness by the New York Stock Exchange LLC (``NYSE''); \6\ and 
(ii) make technical changes to Rule 431--NYSE Alternext Equities.
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    \6\ See Securities Exchange Act Release No. 59077 (December 10, 
2008), 73 FR 76691 (December 17, 2008) (SR-NYSE-2008-127) (clean-up 
amendments related to the New Market Model).
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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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule changes is to (i) make changes to 
certain NYSE Alternext Equities Rules to conform with amendments to 
corresponding NYSE Rules recently filed for immediate effectiveness by 
the NYSE; and (ii) make technical changes to Rule 431--NYSE Alternext 
Equities.
Background
    As described more fully in a related rule filing,\7\ NYSE Euronext 
acquired The Amex Membership Corporation (``AMC'') pursuant to an 
Agreement and Plan of Merger, dated January 17, 2008 (the ``Merger''). 
In connection with the Merger, the Exchange's predecessor, the American 
Stock Exchange LLC (``Amex''), a subsidiary of AMC, became a subsidiary 
of NYSE Euronext called NYSE Alternext U.S. LLC, and continues to 
operate as a national securities exchange registered under Section 6 of 
the Act.\8\ The effective date of the Merger was October 1, 2008.
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    \7\ See Securities Exchange Act Release No. 58673 (September 29, 
2008), 73 FR 57707 (October 3, 2008) (SR-NYSE-2008-60 and SR-Amex 
2008-62) (approving the Merger).
    \8\ 15 U.S.C. 78f.
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    In connection with the Merger, on December 1, 2008, the Exchange 
relocated all equities trading conducted on the Exchange legacy trading 
systems and facilities located at 86 Trinity Place, New York, New York, 
to trading systems and facilities located at 11 Wall Street, New York, 
New York (the ``Equities Relocation''). The Exchange's equity trading 
systems and facilities at 11 Wall Street (the ``NYSE Alternext Trading 
Systems'') are operated by the NYSE on behalf of the Exchange.\9\
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    \9\ See Securities Exchange Act Release No. 58705 (October 1, 
2008), 73 FR 58995 (October 8, 2008) (SR-Amex 2008-63) (approving 
the Equities Relocation).
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    As part of the Equities Relocation, NYSE Alternext adopted NYSE 
Rules 1-1004, subject to such changes as necessary to apply the Rules 
to the Exchange, as the NYSE Alternext Equities Rules to govern trading 
on the NYSE Alternext Trading Systems.\10\ The NYSE Alternext Equities 
Rules, which became operative on December 1, 2008, are substantially 
identical to the current NYSE Rules 1-1004 and the Exchange continues 
to update the NYSE Alternext Equities Rules as necessary to conform 
with rule changes to corresponding NYSE Rules filed by the NYSE.
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    \10\ See Securities Exchange Act Release No. 58705 (October 1, 
2008), 73 FR 58995 (October 8, 2008) (SR-Amex 2008-63) (approving 
the Equities Relocation); Securities Exchange Act Release No. 58833 
(October 22, 2008), 73 FR 64642 (October 30, 2008) (SR-NYSE-2008-
106) and Securities Exchange Act Release No. 58839 (October 23, 
2008), 73 FR 64645 (October 30, 2008) (SR-NYSEALTR-2008-03) 
(together, approving the Bonds Relocation); Securities Exchange Act 
Release No. 59022 (November 26, 2008), 73 FR 73683 (December 3, 
2008) (SR-NYSEALTR-2008-10) (adopting amendments to NYSE Alternext 
Equities Rules to track changes to corresponding NYSE Rules); 
Securities Exchange Act Release No. 59027 (November 28, 2008), 73 FR 
73681 (December 3, 2008) (SR-NYSEALTR-2008-11) (adopting amendments 
to Rule 62-NYSE Alternext Equities to track changes to corresponding 
NYSE Rule 62).
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Proposed Conforming Amendments to Certain NYSE Alternext Equities 
Rules:
    As noted above, the Exchange proposes to make changes to certain 
NYSE Alternext Equities Rules to conform with amendments to 
corresponding NYSE Rules recently filed for immediate effectiveness by 
the NYSE. Unless specifically noted, and subject to such technical 
changes as are necessary to apply the Rules to the Exchange, NYSE 
Alternext is proposing to adopt the NYSE's rule changes in the form 
that they were filed with the Commission. The NYSE's rule changes and 
the Exchange's proposed conforming rule changes are described below.
NYSE Rule Filing SR-NYSE-2008-127 \11\
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    \11\ See Securities Exchange Act Release No. 59077 (December 10, 
2008), 73 FR 76691 (December 17, 2008).
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    In this filing, the NYSE proposed to (i) amend the operative 
duration of Rule 104T (Dealings by DMMs), (ii) delete text from Rules 
104T and 123 (Record of Orders) relating to orders received by NYSE 
systems and DMM yielding, (iii) change internal cross-references in 
Rules 98 (Operation of a DMM Unit) and 123E (DMM Combination Review 
Policy), (iv) add the terms ``market maker'' and ``market making'' to 
certain provisions of Rule 431 (Margin Requirements), and (v) make 
technical ``clean-up'' changes to other NYSE Rules by substituting 
``DMM'' for ``specialist''.
    Most of the changes noted above were adopted by the Exchange for 
the NYSE Alternext Equities Rules in a prior filing tracking changes to 
NYSE Rules.\12\ However, the Exchange proposes the following conforming 
changes that still need to be made to the NYSE Alternext Equities 
Rules: (i) In Rule 70.25(a)(viii) clarifying ``DMM unit'' rather than 
``DMM''; (ii) in Rule 98(c)(2)(D), removing the cross-reference to 
paragraph (b) of Rule 103.20; (iii) in Rule 431(f)(2)(M)(iv)(10)(F) 
adding in the terms ``market maker'' and ``market making''; and (iv) in 
the chart contained in Rule 900(b), clarifying that, for Rule 98A, the 
second sentence of the first paragraph of that Rule does not apply to 
after-hours trading on the Exchange.
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    \12\ See Securities Exchange Act Release No. 59022 (November 26, 
2008), 73 FR 73683 (December 3, 2008) (SR-NYSEALTR-2008-10).
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Proposed Technical Amendments to Rule 431-NYSE Alternext Equities
    The Exchange also proposes to make additional technical changes to 
Rule 431-NYSE Alternext Equities to correct references to 
``specialist'' that were incorrectly changed to ``DMM'' in a prior rule 
filing.\13\ The term ``specialist'' as used in that Rule is used in 
conformity with federal rules and, unlike the term ``DMM'', is not 
Exchange-specific.
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    \13\ See Securities Exchange Act Release No. 59022 (November 26, 
2008), 73 FR 73683 (December 3, 2008) (SR-NYSEALTR-2008-10).
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\14\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\15\ in particular, in that it is designed to 
promote just and equitable principles of

[[Page 6449]]

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. The proposal also supports the principles of Section 
11A(a)(1) \16\ of the Act in that it seeks to ensure the economically 
efficient execution of securities transactions, to make it practicable 
for brokers to execute investors' orders in the best market, and to 
provide an opportunity for investors' orders to be executed without the 
participation of a dealer.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(5).
    \16\ 15 U.S.C. 78k-1(a)(1).
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    The Exchange believes that the proposed rule changes are necessary 
and appropriate to update the NYSE Alternext Equities Rules in 
conformity with changes made to the corresponding NYSE Rules on which 
they are based and to make other technical amendments to correct the 
Rules. To the extent the Exchange has proposed changes that differ from 
the NYSE version of the Rules, such changes are technical in nature and 
do not change the substance of the proposed Rules.

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: (1) Does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
and (3) 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 \17\ and Rule 19b-4(f)(6) thereunder.\18\
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) normally does 
not become operative for 30 days after the date of filing.\19\ However, 
Rule 19b-4(f)(6)(iii) permits the Commission to designate a shorter 
time if such action is consistent with the protection of investors and 
the public interest. The Exchange requested that the Commission waive 
the 30-day operative delay, as specified in Rule 19b-4(f)(6)(iii),\20\ 
which would make the rule change effective and operative upon filing.
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    \19\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the self-regulatory organization to give the 
Commission 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. NYSE has satisfied this requirement.
    \20\ 17 CFR 240.19b-4(f)(6)(iii).
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    The Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest 
because it will conform the rule text to language that was previously 
approved by the Commission in prior proposed rule changes, and make 
technical clarifications to those rules.\21\ Waiving the operative 
delay will ensure that the rule text of the Exchange is accurate and 
will avoid potential confusion by eliminating technical errors. 
Accordingly, the Commission designates the proposed rule change as 
operative upon filing with the Commission.\22\
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    \21\ See supra notes 11 and 12.
    \22\ 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 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.\23\
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    \23\ 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-NYSEALTR-2009-03 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-NYSEALTR-2009-03. 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-NYSEALTR-2009-03 and should 
be submitted on or before March 2, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-2580 Filed 2-6-09; 8:45 am]

BILLING CODE 8011-01-P