Document ID: SEC-2006-1677-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Boston Stock Exchange, Inc.
Posted Date: 2006-12-26T05:00Z

[Federal Register: December 26, 2006 (Volume 71, Number 247)]
[Notices]               
[Page 77428-77429]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26de06-76]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54949; File No. SR-BSE-2006-53]

 
Self-Regulatory Organizations; Boston Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto To Allow Exchange Traded Funds To Trade on 
the Boston Equities Exchange Until 4:15 p.m. Eastern Standard Time

December 18, 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 November 30, 2006, the Boston Stock Exchange, Inc. (``Exchange'' or 
``BSE'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II 
and III below, which Items have been substantially prepared by the 
Exchange. On December 14, 2006, the BSE submitted Amendment No. 1 to 
the proposed rule change. The Exchange filed the proposed rule change 
pursuant to Section 19(b)(3)(A) 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 solicit 
comments on the proposed rule change, as amended, 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).
    \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 BSE proposes to allow Exchange Traded Funds, or ETFs, to trade 
on the Boston Equities Exchange (``BeX'') until 4:15 p.m. Eastern 
Standard Time each business day. Additionally, by this filing the BSE 
is providing notice to its Members that the Good Till Time order type 
will not be available for approximately six to eight weeks following 
the November 20, 2006 launch of the BeX marketplace. The BSE will 
provide its Members with at least one day's notice of the date Good 
Till Time order types will be accepted on BeX.
    The text of the proposed rule changes is available on the 
Exchange's Web site (http://www.bse.com), at the Exchange'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 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. 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
    On June 13, 2006, the BSE filed Amendment No. 3 to SR-BSE-2006-22, 
a rule filing submitted in connection with the implementation of the 
first of two phases of BeX, a fully automated electronic book for the 
display and execution of orders in securities. On August 25, 2006, SR-
BSE-2006-22 was approved by the Commission.\5\ On August 3, 2006, the 
BSE filed, in connection with the implementation of the second phase of 
the BeX trading system and in connection with satisfying the 
requirements of Regulation NMS, SR-BSE-2006-30. On September 29, 2006, 
the Commission approved SR-BSE-2006-30.\6\
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    \5\ See Securities Exchange Act Release No. 54365 (Aug. 25, 
2006), 71 FR 52192 (Sept. 1, 2006).
    \6\ See Securities Exchange Act Release No. 54546 (Sept. 29, 
2006), 71 FR 59161 (Oct. 6, 2006).
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    The purpose of this filing is to amend the operating hours of the 
BeX marketplace to reflect that ETFs may trade on BeX until 4:15 p.m. 
Eastern Standard Time each business day. The Amendment to the filing 
clarifies that although ETFs may trade on BeX until 4:15 p.m. Eastern 
Standard Time, ETFs cannot be submitted as Limit or Close Orders, will 
not participate in the Market on Close Period described in Chapter 
XXXVII, Section 3(f)(i) of the BSE Rules, and will not be placed in the 
Authorized Reserve State described in Chapter XXXVII, Section 3(f)(ii) 
of the BSE Rules. Rather, ETFs will simply cease matching in the BeX 
system after 4:15 p.m.
    Further, by this filing, the BSE is providing notice to its Members 
that the Good Till Time order type will not be available for 
approximately six to eight weeks following the November 20, 2006 launch 
of the BeX marketplace. The BSE will provide its Members with at least 
one day's notice of the date Good Till Time order types will be 
accepted on BeX.
2. Statutory Basis
    The Exchange believes that the proposal, as amended, is consistent 
with the requirements of Section 6(b) of the Act,\7\ in general, and 
furthers the objectives of Section 6(b)(5) of the Act,\8\ in 
particular, in that it is designed to prevent fraudulent and 
manipulative acts and practices, 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.\9\
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
    \9\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change under 
Section 19(b)(3)(C) of the Act, the Commission considers the period 
to commence on December 14, 2006, the date on which the BSE filed 
Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).
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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 comments on the 
proposed rule change.

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

    Because the foregoing proposed rule change does not: (1) 
Significantly affect the protection of investors or the public 
interest; (2) impose any significant burden on competition; and (3) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate if consistent with 
the protection of investors and the public interest, provided that the 
Exchange has given the Commission written notice of its intent to file 
the proposed rule change

[[Page 77429]]

at least five business days prior to the filing date of the 
proposal.\10\
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    \10\ As required under Rule 19b-4(f)(6)(iii), BSE provided the 
Commission with notice of its intent to file the proposed rule 
change at least five business days prior to the date of filing of 
the proposal.
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    A proposed rule change filed under Rule 19b-4(f)(6) normally may 
not become operative prior to 30 days after the date of filing.\11\ 
However, Rule 19b-4(f)(6)(iii) \12\ permits the Commission to designate 
a shorter time if such action is consistent with the protection of 
investors and the public interest. The Exchange has requested that the 
Commission waive the 30-day pre-operative period, which would make the 
rule change operative immediately. The Commission believes that waiving 
the 30-day operative delay is consistent with the protection of 
investors and the public interest, because the proposed rule change 
clarifies how BeX operates in relation to ETFs.\13\ For this reason, 
the Commission designates that the proposal become operative 
immediately.
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    \11\ 17 CFR 240.19b-4(f)(6)(iii).
    \12\ Id.
    \13\ For 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. 
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.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended, 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-BSE-2006-53 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-BSE-2006-53. 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 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-BSE-2006-53 and should be submitted on or before January 
16, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\
Florence E. Harmon,
Deputy Secretary.
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    \14\ 17 CFR 200.30-3(a)(12).
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 [FR Doc. E6-22006 Filed 12-22-06; 8:45 am]

BILLING CODE 8011-01-P