Document ID: SEC-2006-1419-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: NYSE Arca, Inc.
Posted Date: 2006-11-02T05:00Z

[Federal Register: November 2, 2006 (Volume 71, Number 212)]
[Notices]               
[Page 64596]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02no06-86]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54655; File No. SR-NYSEArca-2006-48]

 
Self-Regulatory Organizations; NYSE Arca, Inc.; Order Approving 
Proposed Rule Change To Amend NYSE Arca Equities, Inc.'s Clearly 
Erroneous Executions Rule To Include an Appeal Fee for the NYSE Arca 
Marketplace (f/k/a the Archipelago Exchange)

October 26, 2006.
    On August 11, 2006, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') a 
proposed rule change pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ to 
assess a fee associated with the appeals process of NYSE Arca Equities, 
Inc. (``NYSE Arca Equities'') Rule 7.10. The proposed rule change was 
published for comment in the Federal Register on September 22, 2006.\3\ 
The Commission received no comments on the proposal. This order 
approves the proposed rule change.
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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. 54466 (September 18, 
2006), 71 FR 55537.
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    NYSE Arca proposes to amend NYSE Arca Equities Rule 7.10 governing 
clearly erroneous executions (``CEEs'') on the NYSE Arca Marketplace 
(f/k/a the Archipelago Exchange), the equities trading facility of NYSE 
Arca Equities. Specifically, under the proposed rule change, if an 
Equity Trading Permit (``ETP'') Holder appeals a CEE decision made by 
an NYSE Arca Equities officer to the CEE Panel and the CEE Panel 
subsequently upholds the decision, the ETP Holder would be assessed a 
$500.00 fee. The Exchange believes that assessing a $500.00 fee against 
any ETP Holder who appeals a CEE decision that is subsequently upheld 
by the CEE Panel would discourage frivolous and abusive uses of the CEE 
appeal process. The Exchange noted that some ETP Holders have taken 
advantage of the appeals process by appealing all decisions in which 
they are involved, including decisions that involve a de minimis value.
    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange.\4\ 
In particular, the Commission finds that the proposed rule change is 
consistent with Section 6(b)(4) of the Act,\5\ which requires that the 
rules of an exchange provide for the equitable allocation of reasonable 
dues, fees, and other charges among its members and issuers and other 
persons using its facilities, and with Section 6(b)(5) of the Act,\6\ 
which requires that the rules of an exchange be designed to promote 
just and equitable principles of trade, remove impediments to and 
perfect the mechanism of a free and open market and a national 
securities system, and, in general, protect investors and the public 
interest. The Commission believes that the proposed fee is reasonable 
as a method to discourage frivolous uses by ETP Holders of the 
Exchange's CEE appeal process. In addition, the Commission believes 
that the proposal would not unduly affect the rights of an ETP Holder 
to appeal to the CEE Panel the decisions of NYSE Arca Equities officers 
with respect to transactions that are alleged to involve a clearly 
erroneous execution.
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    \4\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. See 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f(b)(4).
    \6\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\7\ that the proposed rule change (SR-NYSEArca-2006-48) is 
approved.
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    \7\ 15 U.S.C. 78s(b)(2).
    \8\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
Nancy M. Morris,
Secretary.
 [FR Doc. E6-18449 Filed 11-1-06; 8:45 am]

BILLING CODE 8011-01-P