Document ID: SEC-2007-1568-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Chicago Stock Exchange, Inc.
Posted Date: 2007-11-20T05:00Z

[Federal Register: November 20, 2007 (Volume 72, Number 223)]
[Notices]               
[Page 65377-65379]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20no07-89]                         

=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56784; File No. SR-CHX-2007-25]

 
Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change as 
Modified by Amendment No. 1 Thereto to Eliminate References to the ITS 
Plan and Other Now-Obsolete Matters

November 14, 2007.
    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 October 17, 2007, the Chicago Stock Exchange, Inc. 
(``CHX'' 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 substantially prepared by 
the CHX. On November 9, 2007, CHX filed Amendment No. 1 to the proposed 
rule change. CHX has designated the proposed rule change as a ``non-
controversial'' rule change pursuant to section 19(b)(3)(A) of the Act 
\3\ and Rule

[[Page 65378]]

19b-4(f)(6) thereunder, \4\ which renders the proposed rule change 
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.
---------------------------------------------------------------------------

    \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).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its rules to eliminate now-obsolete 
references to the Intermarket Trading System Plan (``ITS Plan''), the 
NMS Linkage Plan, the telephonic access requirements of the Nasdaq/UTP 
Plan and the compliance date for Rule 611 (``Trading Phase Date'') of 
Regulation NMS (``Reg NMS''). The text of the proposed rule change is 
available at CHX, the Commission's Public Reference Room, and http://www.chx.com/rules/proposed_rules.htm
.

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 CHX 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 CHX 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
    In 2006, the Exchange made a substantial number of changes to its 
rules in connection with its implementation of a new trading model. \5\ 
At the time these new rules were approved, the Nasdaq/UTP Plan still 
required participant exchanges to provide NASD market participants with 
telephonic access to their quotes; the ITS Plan was still in effect and 
the NMS Linkage Plan had just been approved; and the Trading Phase Date 
was still several months away. As a result, the Exchange's rules 
contained references to these plans and to the way that the Exchange's 
rules should operate both before and after the Trading Phase Date. \6\
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 54550 (September 29, 
2006), 71 FR 59563 (October 10, 2006) (approving CHX's proposed new 
trading model).
    \6\ See, e.g., Article 1, Rule 1(o) (defining the term NBBO both 
before and after the full implementation of Reg NMS); and Article 19 
(containing the ITS rules).
---------------------------------------------------------------------------

    In the ensuing months, however, the ITS Plan has been eliminated; 
the NMS Linkage Plan has terminated; the Trading Phase Date has passed; 
and the access requirements of the Nasdaq/UTP Plan have changed. \7\ 
The Exchange now proposes to update its rules to eliminate all now-
outdated references to the ITS and NMS Linkage Plans, to the compliance 
or effective dates of any provisions of Reg NMS and to the telephonic 
access requirements of the Nasdaq/UTP Plan.
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release Nos. 55397 (March 5, 
2007), 72 FR 11066 (March 12, 2007) (eliminating the ITS Plan); 
54551 (September 29, 2006), 71 FR 59148 (October 6, 2006) (approving 
the NMS Linkage Plan, with a termination date of June 30, 2007); 
55160 (January 24, 2007), 72 FR 4202 (January 30, 2007) (File No. 
S7-10-04) (extending the Trading Phase Date from February 5, 2007 to 
March 5, 2007); and 54936 (December 14, 2006), 71 FR 76381 (December 
20, 2006) (approving Amendment No. 18 to the Nasdaq/UTP Plan, which, 
in general terms, replaced the telephonic access requirements with 
market access requirements consistent with Rule 610).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with section 6(b) of the Act, \8\ in general, and furthers the 
objectives of section 6(b)(5) of the Act, \9\ in particular, in that 
the proposed rule change is 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 market system, and, in 
general, protect investors and the public interest by updating the 
Exchange's rules to eliminate outdated references to matters that are 
no longer relevant.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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.

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. 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) by its terms 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, it 
has become effective pursuant to section 19(b)(3)(A) of the Act \10\ 
and Rule 19b-4(f)(6) thereunder. \11\ As required under Rule 19b-
4(f)(6)(iii) under the Act, the Exchange has given the Commission 
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.
---------------------------------------------------------------------------

    \10\15 U.S.C. 78s(b)(3)(A).
    \11\17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) under the Act 
\12\ normally may not become operative prior to 30 days after the date 
of filing. However, Rule 19b-4(f)(6)(iii) \13\ permits the Commission 
to designate a shorter time if such action is consistent with the 
protection of investors and the public interest. CHX has requested that 
the Commission waive the 30-day operative delay, as specified in Rule 
19b-4(f)(6)(iii), \14\ which would make the rule change effective and 
operative upon filing. The Commission believes that waiving the 30-day 
operative delay is consistent with the protection of investors and the 
public interest because the proposal allows the Exchange to immediately 
update its rules to reflect, among other changes, the termination of 
the NMS Linkage Plan, the elimination of the ITS Plan, and the 
implementation of Reg NMS. \15\ Accordingly, the Commission designates 
the proposed rule change operative upon filing with the Commission.
---------------------------------------------------------------------------

    \12\Id.
    \13\17 CFR 240.19b-4(f)(6)(iii).
    \14\Id.
    \15\For purposes only of waiving the operative delay for this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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. \16\
---------------------------------------------------------------------------

    \16\The effective date of the original proposed rule is October 
17, 2007. The effective date of Amendment No. 1 is November 9, 2007. 
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 November 9, 2007, the date on which CHX submitted 
Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).

---------------------------------------------------------------------------

[[Page 65379]]

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-CHX-2007-25 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-CHX-2007-25. 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 such filing also will be available for 
inspection and copying at the principal office of the CHX. 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-CHX-2007-25 and should be 
submitted on or before December 11, 2007.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\17\
---------------------------------------------------------------------------

    \17\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-22627 Filed 11-19-07; 8:45 am]

BILLING CODE 8011-01-P