[Federal Register: July 18, 2007 (Volume 72, Number 137)]
[Notices]
[Page 39471-39472]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18jy07-120]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56056; File No. SR-BSE-2007-19]
Self-Regulatory Organizations; Boston Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
To Amend the Rules of the Boston Options Exchange Related to Obvious
Errors
July 12, 2007.
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 June 28, 2007, the Boston Stock Exchange, Inc. (``BSE'' or
``Exchange'') 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. The Exchange filed the proposed rule change as a ``non-
controversial'' proposed rule change pursuant to section 19(b)(3)(A)
\3\ of the 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
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 Exchange proposes amending the Boston Options Exchange
(``BOX'') Rules related to Obvious Errors to allow the parties to a
transaction to mutually agree to nullify or adjust a trade. Below is
the text of the proposed rule change. Proposed new language is in
italics.
* * * * *
Rules of the Boston Stock Exchange
Rules of the Boston Options Exchange Facility
Chapter V. Doing Business on BOX
Sec. 20 Obvious Errors
(a) through (f). No change.
(g) Mutual Agreement. The determination as to whether a trade was
executed in error may be made by mutual agreement of the affected
parties to a particular transaction. A trade may be nullified or
adjusted on the terms that all parties to a particular transaction
agree. In the absence of mutual agreement by the parties, a particular
trade may only be nullified or adjusted when the transaction results in
an Obvious Error as provided for in this Section.
Supplementary Material: No change.
* * * * *
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. BSE 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 proposes to amend BOX's Rules to provide parties to a
particular transaction with the ability to nullify or adjust a trade if
such nullification or adjustment is agreed to by all parties to the
transaction at issue. In other words, the determination as to whether a
trade was executed at an erroneous price may be made by mutual
agreement of the affected parties to a particular transaction. A trade
may be nullified or adjusted on the terms that all parties to a
particular transaction agree. In the absence of mutual agreement by the
parties, a particular trade may only be nullified or adjusted when the
transaction results in an Obvious Error as provided for in Chapter V,
Section 20 of BOX's Rules.
[[Page 39472]]
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with section 6(b) of the Act,\5\ in general, and furthers the
objectives of section 6(b)(5) of the Act,\6\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, and to protect
investors and the public interest in that it is designed 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 for a free and open market and a national market
system, and, in general, to protect investors and the public interest.
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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 would
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 proposed rule change does not: (i) Significantly affect
the protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days after the date of filing (or such shorter time as the Commission
may designate if consistent with the protection of investors and the
public interest), the proposed rule change has become effective
pursuant to section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)
thereunder.\8\ As required under Rule 19b-4(f)(6)(iii),\9\ the Exchange
provided the Commission with 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 of
the filing of the proposed rule change.
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6).
\9\ 17 CFR 240.19b-4(f)(6)(iii).
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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 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-BSE-2007-19 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-2007-19. 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-BSE-2007-19 and should be
submitted on or before August 8, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E7-13881 Filed 7-17-07; 8:45 am]
BILLING CODE 8010-01-P