[Federal Register: April 1, 2008 (Volume 73, Number 63)]
[Notices]
[Page 17386-17387]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01ap08-85]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-57557; File No. SR-ISE-2008-25]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing of Proposed Rule Change, and Amendment No. 1
Thereto, Relating to the Rescission of the ``No MPM'' Order Type
March 26, 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 March 5, 2008, the International Securities Exchange, LLC
(``Exchange'' or ``ISE'') 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. On March 17, 2008, the Exchange filed
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.
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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 ISE proposes to amend its rules to rescind the ``No MPM'' order
type. The text of the proposed rule change is below. Proposed new
language is italicized; proposed deletions are enclosed in brackets.
* * * * *
Rule 2104. Types of Orders
(a)-(g) No change.
[(h) No MPM. Market or limit orders that should not be executed
against orders residing in the Midpoint Match. (See Rule 2129)]
[(i)](h) No further change.
[(j)](i) No further change.
[(k)](j) No further change.
[(l)](k) No further change.
[(m)](l) No further change.
[(n)](m) No further change.
[(o)](n) No further change.
* * * * *
2106. Opening Process
(a) No change.
(1) All order types other than Stop/Stop Limit, [No MPM,] Post
Only, FOK and IOC may participate in the opening transaction. Reserve
orders may participate to the full extent of their size. Discretionary
orders may participate at their most aggressive prices. Pegged orders
will have limit prices based upon the NBBO that is required for the
opening transaction to occur.
(2)-(3) No change.
(b)-(f) No change.
* * * * *
2107. Priority and Execution of Orders
(a) No change.
(b) Order Execution. All orders are handled automatically by the
ISE Stock Exchange. All orders are available for price improvement at
the midpoint of the NBBO if contra-side interest exists in Midpoint
Match[, unless marked ``No MPM'']. Except as specified below in
paragraph (c), orders will not be executed at prices that are inferior
to
[[Page 17387]]
Protected Quotations available at other Trading Centers.
* * * * *
Rule 2129. MidPoint Match
The MidPoint Match (``MPM'') is a process by which Members [can
seek] may receive an execution price that is at the midpoint of the
NBBO.
(a)-(g) 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. The Exchange 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 best bids and offers on the ISE Stock Exchange are displayed to
the marketplace on a continuous basis. Additionally, the ISE offers
incoming orders an opportunity to receive price improvement at the
midpoint of the National Best Bid or Offer (``NBBO'') through its
MidPoint Match (``MPM'') process. Specifically, before executing
incoming orders against the ISE's displayed bid or offer, the System
checks MPM to see if there is contra-side interest that can provide
price improvement. However, under ISE's current rules, Equity
Electronic Access Members may specify on orders that they do not want
the orders to execute against MPM interest, thereby denying such orders
the opportunity for price improvement.
The Exchange proposes to eliminate the ``No MPM'' order qualifier
so that all inbound orders will be exposed to MPM interest and be
afforded price improvement, when available, before executing against
the ISE's displayed quotations. The Exchange believes that elimination
of the ``No MPM'' order qualifier is appropriate to assure that
customers are provided the opportunity to interact with this additional
source of liquidity and to receive price improvement whenever possible.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder. Specifically, the
Exchange believes the proposed rule change is consistent with section
6(b)(5)\3\ of the Act, requiring that the rules of an exchange be
designed to promote just and equitable principles of trade, serve 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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\3\15 U.S.C. 78(f)(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes that the proposed rule change does not 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 not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
A. By order approve such proposed rule change, or
B. institute proceedings to determine whether the proposed rule
change should be disapproved.
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 No. SR-ISE-2008-25 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-ISE-2008-25. 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 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-ISE-2008-25 and should be
submitted on or before April 22, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\4\
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\4\17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-6609 Filed 3-31-08; 8:45 am]
BILLING CODE 8011-01-P