Document ID: SEC-2009-1493-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Order Approving a Proposed Rule Change To Amend the Grandfathered Rules of the Exchange
Posted Date: 2009-10-21T04:00Z

[Federal Register: October 21, 2009 (Volume 74, Number 202)]
[Notices]               
[Page 54113-54114]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21oc09-112]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60818; File No. SR-BX-2009-048]

 
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Order 
Approving a Proposed Rule Change To Amend the Grandfathered Rules of 
the Exchange

October 13, 2009.

    On August 17, 2009, NASDAQ OMX BX, Inc. (``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 amend the 
Grandfathered Rules of the Exchange.\3\ The proposed rule change was 
published for comment in the Federal Register on September 8, 2009.\4\ 
The Commission received no comments on the proposal.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The Grandfathered Rules are operative to the extent that 
they apply to the Boston Options Exchange Group, LLC (``BOX'') and 
to Options Participants on the Exchange, and are to be read in 
conjunction with the Rules of the BOX.
    \4\ See Securities Exchange Act Release No. 60591 (August 31, 
2009), 74 FR 46288.
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    The proposed rule change would incorporate certain provisions of 
the former Constitution of the Boston Stock Exchange, Incorporated 
(``BSE'') \5\ into the Grandfathered Rules. The provisions to be added 
to the Grandfathered Rules relate to the following: (1) Participation 
(formerly Membership) rules, to supplement the By-Laws and the 
Grandfathered Rules to direct the BOX Options Participants 
(``Participants'') and prospective participants to Section 6(c) of the 
Act,\6\ as cited in the proposed rule text regarding the investigation 
and acceptance of an applicant; (2) Non-liability of the Exchange 
provision, to reinforce to Participants the ``non-liability'' of the 
Exchange for damages sustained from use of the facilities of the 
Exchange; (3) Insolvent Participants, to provide guidance for Insolvent 
Participants to notify the Exchange, of such insolvency and to state 
that the Exchange will notify the Commission of such insolvency; and 
(4) Exchange Inquiries to remind Participants that they may be subject 
to expulsion or suspension for failure to respond to an Exchange 
Inquiry.
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    \5\ Securities Exchange Act Release No. 58324 (August 7, 2008), 
73 FR 46936 (August 12, 2008) (SR-BSE-2008-02, -23, -25; SR-BSECC-
2008-01) (``Release No. 34-58324'').
    \6\ 15 U.S.C. 78f(c).

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[[Page 54114]]

    The Exchange proposes to apply these provisions retroactively to 
the date on which proposals set forth in Release No. 34-58324 were 
approved by the Commission.\7\
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    \7\ See supra note 5.
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    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 \8\ and, in 
particular, the requirements of Section 6 of the Act \9\ and the rules 
and regulations thereunder. The Commission finds specifically that the 
proposed rule change is consistent with Section 6(b)(5) of the Act,\10\ 
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 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 because it clarifies the provisions of the former BSE 
Constitution that will continue to apply to Participants.
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    \8\ In approving this proposed rule change, the Commission notes 
that it has considered the proposed rule's impact on efficiency, 
competition, and capital formation. 15 U.S.C. 78c(f).
    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\11\ that the proposed rule change (SR-BX-2009-048) be, and it 
hereby is, approved.
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    \11\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-25202 Filed 10-20-09; 8:45 am]

BILLING CODE 8011-01-P