[Federal Register Volume 59, Number 21 (Tuesday, February 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-2121]


[[Page Unknown]]

[Federal Register: February 1, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-33520; File No. 4-208]

 

Intermarket Trading System; Notice of Filing of Eleventh 
Amendment to the ITS Plan Relating to the Use of a Back-up System

January 25, 1994.
    Purusant to Rule 11Aa3-2 under the Securities Exchange Act of 1934 
(``Act''), notice is hereby given that on December 21, 1993, the 
Intermarket Trading System (``ITS'') submitted to the Securities and 
Exchange Commission (``Commission'') and amendment (``Eleventh 
Amendment'') to the restated ITS Plan.\1\ The ITS participants filed 
the proposal to make several technical amendments to the ITS Plan 
including amendments relating to the use of a back-up system. The 
Commission is publishing this notice to solicit comments on the 
amendment from interested persons.
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    \1\The ITS is a National Market System (``NMS'') plan approved 
by the Commission pursuant to Section 11A of the Act and Rule 11Aa3-
2. Securities Exchange Act Release No. 19456 (January 27, 1983), 48 
FR 4938.
    The ITS is a communications and order routing network linking 
eight national securities exchanges and the electronic over-the-
counter (``OTC'') market operated by the National Association of 
Securities Dealers, Inc. (``NASD''). The ITS was designed to 
facilitate intermarket trading in exchange-listed equity securities 
based on current quotation information emanating from the linked 
markets.
    Participants to the ITS Plan include the American Stock 
Exchange, Inc. (``Amex''), the Boston Stock Exchange, Inc. 
(``BSE''), the Chicago Board Options Exchange, Inc. (``CBOE''), the 
Chicago Stock Exchange, Inc. (``CHX''), the Cincinnati Stock 
Exchange, Inc. (``CSE''), the NASD, the New York Stock Exchange, 
Inc. (``NYSE''), the Pacific Stock Exchange, Inc. (``PSE''), and the 
Philadelphia Stock Exchange, Inc. (``PHLX'').
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I. Description of the Amendment

    The ITS amendment would: (1) Provide for use of a back-up system in 
the event ITS becomes inoperable; (2) recognize the use of the Regional 
Computer Interface (``RCI'') by the Amex; (3) eliminate references to 
line costs and line sharing; (4) require a biennial rather than an 
annual audit by an independent public accountant; (5) change all 
references to the Midwest Stock Exchange, Inc. (``MSE'') to CHX; and 
(6) correct the addresses of the CHX, CSE, and PSE.
    The amendment would add section 15 of the ITS Plan to provide for 
the use of a back-up system. In the event the ITS system becomes 
inoperable, ITS would utilize a designated NYSE operating system 
(``NYSE System'') on a preemptive and priority basis. The NYSE System 
is comprised of computers and peripheral equipment sufficient to 
operate ITS at a minimum 50% of the ITS's disk capacity. The NYSE 
System would assume the functions of the ITS within two hours in the 
event of a limited disaster and on the next day in the event of a full 
site disaster.
    The proposal also would amend the ITS Plan to provide for the use 
of the RCI by the Amex through the Amex Display Book Manager (``DBM''). 
The Amex DBM is a computerized system that when fully implemented will, 
to some extent, replace the original ITS stations on the Amex trading 
floor. The proposal would permit communications, through the Amex DBM, 
between the ITS and the Amex floor.
    The amendment would eliminate references in the ITS Plan to line 
costs and line sharing. Because of technological advances, references 
to line costs and line sharing are not longer applicable. The ITS Plan 
will continue to delineate development and production costs.
    The proposal would amend the ITS Plan's audit provision to require 
a biennial rather than an annual audit, concerning expenses, 
allocations, and computations, by an independent public accountant. The 
proposal would require an internal audit to review all expenses, 
allocations, and computations concerning ITS for those years when an 
independent audit is not conducted.
    The proposal also would provide other technical amendments to the 
ITS Plan. The proposal would change all references to the to the 
Midwest Stock Exchange, Inc. (``MSE'') to CHX; and would correct the 
addresses of the CHX, CSE, and PSE.

II. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549. 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that re 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 will also be 
available for inspection and copying at the principal office of the 
ITS. All submissions should refer to the file number in the caption 
above and should be submitted by February 22, 1994.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority, 17 CFR 200.30-3(a)(29).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-2121 Filed 1-31-94; 8:45 am]
BILLING CODE 8010-01-M