Document ID: SEC-2008-0734-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Philadelphia Stock Exchange, Inc.
Posted Date: 2008-05-23T04:00Z

[Federal Register: May 23, 2008 (Volume 73, Number 101)]
[Notices]               
[Page 30183-30184]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23my08-127]                         

[[Page 30183]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57834; File No. SR-Phlx-2008-33]

 
Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing and Order Granting Accelerated Approval of Proposed 
Rule Change, as Modified by Amendment No. 1 Thereto, Relating to Equity 
Linked Notes

May 19, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on May 2, 2008, the Philadelphia Stock Exchange, Inc. (``Phlx'' or 
``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 substantially by the Exchange. 
On May 16, 2008, the Exchange submitted Amendment No. 1 to the proposed 
rule change. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons and is granting accelerated approval to the proposed rule 
change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 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 Rule 803(h) to clarify that the 
listing and trading of Equity Linked Notes (``ELNs'') on the Exchange 
is subject to Rule 19b-4(e) under the Act.\3\ The text of the proposed 
rule change is available at the Exchange, the Commission's Public 
Reference Room, and http://www.phlx.com.
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    \3\ 17 CFR 240.19b-4(e).
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, Phlx included statements 
concerning the purpose of, and basis for, the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item III below. Phlx 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
    The Exchange states that the purpose of the proposed rule change is 
to clarify that the listing and trading of ELNs on the Exchange is 
subject to Rule 19b-4(e) under the Act. Rule 19b-4(e) under the Act 
permits an exchange to list and trade a new derivative securities 
product, such as an ELN, without filing a proposed rule change on Form 
19b-4, if the exchange has, among other things, listing standards for 
the product class.\4\ Rule 19b-4(e) further provides that an exchange 
shall file Form 19b-4(e) within five business days after commencement 
of trading a new derivative securities product. Therefore, upon the 
acceptance of an ELN for listing and trading on the Exchange pursuant 
to the listing standards in Rule 803(h), Phlx will file a Form 19b-4(e) 
with the Commission within five business days after the commencement of 
trading.
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    \4\ See 17 CFR 240.19b-4(e)(1). Phlx Rule 803(h) contains the 
listing standards for ELNs.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) \5\ of the Act, in general, and furthers the 
objectives of Section 6(b)(5),\6\ in particular, in that it is designed 
to promote just and equitable principles of trade, to remove 
impediments to and perfect the mechanisms of a free and open market and 
a national market system, and, in general, to protect investors and the 
public interest, by clarifying that the listing and trading of ELNs on 
the Exchange is subject to Rule 19b-4(e) under the Act.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 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 either solicited or received.

III. 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-Phlx-2008-33 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-Phlx-2008-33. 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 the 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-Phlx-2008-33 and should be 
submitted on or before June 13, 2008.

IV. Commission's Findings and Order Granting Accelerated Approval of 
the Proposed Rule Change

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to

[[Page 30184]]

a national securities exchange.\7\ In particular, the Commission finds 
that the proposed rule change is consistent with Section 6(b)(5) of the 
Act,\8\ which requires that the rules of an exchange be designed, among 
other things, 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.
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    \7\ In approving this rule change, the Commission notes that it 
has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \8\ 15 U.S.C. 78f(b)(5).
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    The Commission finds good cause for approving this proposal before 
the 30th day after the publication of notice thereof in the Federal 
Register. The proposal seeks to clarify that the Exchange's listing and 
trading of ELNs under Rule 803(h) is subject to Rule 19b-4(e) under the 
Act. The Commission does not believe that this clarification raises any 
novel regulatory issues. Therefore, the Commission believes that 
accelerating approval of this proposal is appropriate and would ensure 
that the Exchange's rules clearly reflect the standards for listing and 
trading of ELNs and conform the Phlx's rules to those of other 
exchanges without delay.\9\
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    \9\ See e.g., Chicago Board Options Exchange Rule 31.5(I) and 
NYSE Arca Rule 5.2(j)(2).
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V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\10\ that the proposed rule change, as amended (SR-Phlx-2008-33), 
be, and it hereby is, approved on an accelerated basis.
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    \10\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-11531 Filed 5-22-08; 8:45 am]

BILLING CODE 8010-01-P