Document ID: SEC-2009-0968-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Equities Rules 7.31(x) and 7.31(kk)
Posted Date: 2009-07-15T04:00Z

[Federal Register: July 15, 2009 (Volume 74, Number 134)]
[Notices]               
[Page 34383-34385]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15jy09-131]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60262; File No. SR-NYSEArca-2009-63]

 
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca 
Equities Rules 7.31(x) and 7.31(kk)

July 8, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that on July 2, 2009, NYSE Arca, Inc. (``NYSE Arca'' or the 
``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 self-regulatory 
organization. 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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend NYSE Arca Equities Rule 7.31(x) and 
7.31(kk) in order to amend the functionality of Primary Only Orders and 
Primary Sweep Orders (collectively ``PO and PSO orders'') routed to the 
New York Stock Exchange LLC (``NYSE'') [sic] The text of the proposed 
rule change is attached as Exhibit 5 to the 19b-4 form. A copy of this 
filing is available on the Exchange's Web site at http://www.nyse.com, 
at the Exchange's principal office 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 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.

[[Page 34384]]

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

1. Purpose
    The Exchange proposes to amend NYSE Arca Equities Rule 7.31(x) and 
7.31(kk) to offer Users \4\ additional execution opportunities for 
their PO and PSO orders routed to the NYSE. Currently, if PO or PSO 
orders routed to the NYSE are not marked immediate-or-cancel (``IOC''), 
the orders are not returned to the entering party but remain at the 
NYSE, until executed or cancelled. For PO and PSO orders routed to the 
NYSE, this executed or cancelled functionality is accomplished by 
marking the order as Do-Not-Ship (``DNS''), a designation specific to 
the NYSE, which according to NYSE rules, prevents the NYSE from routing 
the order to away market centers.\5\ The Exchange proposes to offer 
Users the opportunity to override this DNS designation on PO and PSO 
orders routed to the NYSE. Where Users choose to override the DNS 
designation, PO and PSO orders routed to the NYSE will remain at the 
NYSE until executed, routed away, or cancelled.
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    \4\ NYSE Arca Equities Rule 1.1(yy). The term ``User'' shall 
mean any ETP Holder or Sponsored Participant who is authorized to 
obtain access to the NYSE Arca Marketplace pursuant to Rule 7.29.
    \5\ See NYSE Rule 13, stating that an order marked DNS ``will be 
immediately and automatically cancelled if compliance with Exchange 
rules or federal securities laws requires that all or part of such 
order be routed to another market center for execution.''
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    Whereas the current functionality satisfies both the User's and the 
Exchange's obligations pursuant to Regulation NMS, offering this 
additional functionality for PO and PSO orders routed to the NYSE will 
enhance execution opportunities by expanding access to available 
liquidity.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \6\ of the 
Securities Exchange Act of 1934 (the ``Exchange Act''), in general, and 
furthers the objectives of Section 6(b)(5) of the Act,\7\ in 
particular, in that it is designed to prevent fraudulent and 
manipulative acts and practices, 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. The Exchange 
believes the proposed functionality for PO and PSO orders routed to the 
NYSE will enhance execution opportunities for Exchange Users by 
expanding their access to available liquidity.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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

    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 this 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) \8\ of the Act and subparagraph (f)(6) of Rule 19b-
4 thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to provide 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 filing of the 
proposed rule change, or such shorter time as designated by the 
Commission. The Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally 
does not become operative for 30 days after the date of filing. 
However, Rule 19b-4(f)(6)(iii) \11\ permits the Commission to designate 
a shorter time if such action is consistent with the protection of 
investors and the public interest. The Exchange requests that the 
Commission waive the 30-day operative delay so that the proposal may 
become operative immediately upon filing. The Exchange states that the 
proposed rule change does not introduce new or novel functionality, but 
that the Exchange is merely offering its Users certain order type 
functionality for PO and PSO orders consistent with other current order 
types eligible for routing to or entry on the NYSE.\12\
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    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 17 CFR 240.19b-4(f)(6)(iii).
    \12\ See SR-NYSEArca-2009-63, Item 7.
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    The Commission believes waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest 
because such waiver will allow implementation of execution 
opportunities for Exchange Users without delay.\13\ Accordingly, the 
Commission designates the proposed rule change operative upon filing 
with the Commission.
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    \13\ For the purposes only of waiving the 30-day operative 
delay, the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78(c)(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.

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-NYSEArca-2009-63 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-NYSEArca-2009-63. 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

[[Page 34385]]

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 No. SR-NYSEArca-2009-63 and should be 
submitted on or before August 5, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
 [FR Doc. E9-16711 Filed 7-14-09; 8:45 am]

BILLING CODE 8010-01-P