Document ID: SEC-2008-0052-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2008-01-09T05:00Z

[Federal Register: January 9, 2008 (Volume 73, Number 6)]
[Notices]               
[Page 1656-1657]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09ja08-80]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57087; File No. SR-NYSEArca-2008-01]

 
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Relating to the 
Closing Time for Options on Exchange-Traded Funds

January 2, 2008.
    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 January 2, 2008, NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange''), through its wholly owned subsidiary, NYSE Arca Equities, 
Inc. (``NYSE Arca Equities''), 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 
NYSE Arca. The Exchange filed the proposal as ``non-controversial'' 
pursuant to section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder,\4\ which renders it effective upon filing with the 
Commission. 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\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \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

    NYSE Arca proposes to amend NYSE Arca Rule 7.1 in order to change 
the time at which certain options on exchange-traded funds (``ETFs'') 
cease trading on the Exchange from 1:15 p.m. Pacific Time (``PT'') to 
the time trading ceases in the core trading session of the primary 
listing exchange for the underlying security. The text of the proposed 
rule change is available at the Exchange's principal office, the 
Commission's Public Reference Room, and http://www.nysearca.com.

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

    In its filing with the Commission, NYSE Arca 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.

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

1. Purpose
    The Exchange proposes to amend NYSE Arca Rule 7.1 (``Rule''), 
Trading Sessions, to change the time at which certain options on ETFs 
cease trading on the Exchange. The rule currently specifies the trading 
hours for options on ETFs as commencing at 6:30 a.m. PT and ending at 
1:15 p.m. PT. This extended trading time mirrored the operative closing 
time of the underlying ETF, which for most underlying ETFs was 1:15 
p.m. PT--as set by the primary listing exchange.
    Recently, the Exchange submitted a proposed rule change that was 
effective upon filing that governs the trading hours of ETFs listed on 
NYSE Arca Equities.\5\ As a result of that proposed rule change, the 
closing time for ETFs listed on NYSE Arca Equities changed from 1:15 
p.m. PT to 1 p.m. PT. In order to synchronize the closing time of 
options on ETFs with the closing of the underlying ETF on the primary 
listing exchange, NYSE Arca hereby proposes to cease trading of the 
overlying options at the same time as the primary listing exchange 
closes its core trading session in the underlying ETF.\6\ In the case 
of options on ETFs listed on NYSE Arca Equities, starting January 2, 
2008, this time will be 1 p.m. PT.
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    \5\ See Securities Exchange Act Release No. 56888 (December 3, 
2007), 72 FR 70366 (December 11, 2007) (SR-NYSEArca-2007-124).
    \6\ As amended, this rule will mirror that of the Chicago Board 
Options Exchange (``CBOE''). CBOE Rule 6.1 Interpretations and 
Policies .01 states, in part, that ``hours during which transactions 
in options on individual stocks may be made on the Exchange shall 
correspond to the normal hours for business set forth in the rules 
of the primary exchange listing the stocks underlying CBOE 
options.''
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    The Exchange intends this system change to be effective on filing 
and operative on January 2, 2008. By amending this rule, the Exchange 
will simply synchronize the closing time for options on ETFs with the 
time at which the core trading session of the underlying ETF closes on 
the primary listing exchange.
2. Statutory Basis
    The proposed rule change is consistent with section 6(b) of the 
Act,\7\ in general, and furthers the objectives of section 6(b)(5) \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 facilitating transactions in securities, and to 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 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

    The Exchange has neither solicited nor received written 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

[[Page 1657]]

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, it has become effective pursuant to section 
19(b)(3)(A) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6). The Exchange has requested that the 
Commission waive the requirement that the Exchange provide the 
Commission 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 on which the 
Exchange filed the proposed rule change pursuant to Rule 19b-
4(f)(6)(iii). The Commission hereby grants this request.
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    NYSE Arca has requested that the Commission waive the 30-day 
operative delay and designate the proposed rule change to become 
operative on January 2, 2008. The proposal would synchronize the 
closing time for options on ETFs with the time at which the underlying 
ETF closes in the core trading session of the primary listing exchange. 
The Commission notes that the present proposal is similar to CBOE Rule 
6.1. Therefore, the Commission designates the proposed rule change as 
operative on January 2, 2008.\11\
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    \11\ For the purposes only of waiving the operative date of this 
proposal, 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 such 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 the 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-2008-01 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-NYSEArca-2008-01. 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 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-NYSEArca-2008-01 and should 
be submitted on or before January 30, 2008.

    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. E8-135 Filed 1-8-08; 8:45 am]

BILLING CODE 8011-01-P