[Federal Register: November 9, 2006 (Volume 71, Number 217)]
[Notices]
[Page 65870-65871]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09no06-153]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54688; File No. SR-Phlx-2006-62]
Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to PACE Equity Transaction Charge and NMS Linkage
November 2, 2006.
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 September 26, 2006, 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, II,
and III below, which Items have been substantially prepared by the
Phlx. The Exchange submitted the proposed rule change under Section
19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(2) 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)(2).
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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 the Equity Transaction Charge
(``Charge'') on the Phlx Fee Schedule to extend the application of the
Charge to an order, after being delivered to the Exchange by the PACE
system,\5\ that is executed by the specialist by way of an outbound NMS
Linkage order, when such outbound NMS Linkage order reflects the PACE
order's clearing information.\6\ The Charge will not apply where a PACE
order was executed against an inbound NMS Linkage order. The text of
the proposed rule change is available on the Exchange's Web site at
http://www.phlx.com, at the Exchange's Office of the Secretary and at
the Commission's Public Reference Room.
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\5\ PACE is the Exchange's automated order routing, delivery,
execution and reporting system for equities. See Phlx Rule 229.
\6\ Since October 1, 2006, the effective date of the ``Plan for
the Purpose of Creating and Operating an Intermarket Communications
Linkage Pursuant to Section 11A(a)(3)(B) of the Securities Exchange
Act of 1934'' (``NMS Linkage Plan''), connectivity between markets
is provided pursuant to the Linkage Plan. See Securities Exchange
Act Release No. 54551 (September 29, 2006), 71 FR 59148 (October 6,
2006) (approving the NMS Linkage Plan).
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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, the Phlx 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 Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
[[Page 65871]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of the proposed rule change is to treat PACE trades
that interact with NMS Linkage orders the same as Intermarket Trading
System (``ITS'') commitments with respect to the Exchange's Charge.\7\
The NMS Linkage Plan is the successor Plan to the ITS Plan. While there
are some operational differences between the two Plans, both Plans
facilitate intermarket linkage among market centers trading certain
listed securities and the Exchange believes the NMS Linkage Plan is
used in a similar manner as the ITS Plan by its members and member
organizations. Therefore, the Exchange proposes to apply the Charge to
PACE trades that interact with NMS Linkage orders in the identical
manner as PACE trades that interact with ITS commitments. This is
accomplished by adding the words ``or NMS Linkage order'' to footnote 1
in the Summary of Equity Charges section of the Exchange's Fee
Schedule.
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\7\ See Securities Exchange Act Release No. 47245 (January 24,
2003), 68 FR 5069 (January 31, 2003) (adopting the current fee
treatment of PACE trades that interact with ITS commitments).
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2. Statutory Basis
The Exchange believes that its proposed rule change is consistent
with Section 6(b) of the Act,\8\ in general, and furthers the
objectives of Section 6(b)(4) of the Act,\9\ in particular, regarding
the equitable allocation of reasonable dues, fees, and other charges
among exchange members and other persons using exchange facilities.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(4).
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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 comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The proposed rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act \10\ and subparagraph (f)(2) of Rule 19b-4
thereunder,\11\ because it establishes or changes a due, fee, or other
charge imposed by the Phlx. 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.
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\10\ 15 U.S.C. 78s(b)(3)(a)(ii).
\11\ 17 CFR 240.19b-4(f)(2).
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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-Phlx-2006-62 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-Phlx-2006-62. 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. Copies of such filing also will be
available for inspection and copying at the principal offices 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-2006-62 and should be submitted on or before November 30, 2006.
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\12\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\12\
Nancy M. Morris,
Secretary.
[FR Doc. E6-18944 Filed 11-8-06; 8:45 am]
BILLING CODE 8011-01-P