[Federal Register Volume 66, Number 8 (Thursday, January 11, 2001)]
[Notices]
[Pages 2468-2469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-792]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-43795; File No. SR-ISE-00-21]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the International Securities 
Exchange LLC, Relating to Marking Orders

January 3, 2001.
    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 November 28, 2000, 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 prepared by the 
Exchange. The Commission is publishing this notice to solicit comments 
on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange proposes to amend ISE Rule 712 to provide that Members 
mark orders appropriately. The text of the proposed rule change is as 
follows. New text is italicized and deleted text is bracketed.

Rule 712. Submission of Orders and [for] Clearance of Transactions

    (a) Order Identification. When entering orders on the Exchange, 
each Member shall submit trade information in such form as may be 
prescribed by the Exchange in order to allow the Exchange to properly 
prioritize and match orders and quotations pursuant to Rule 713 and 
report resulting transactions to the Clearing Corporation.
    [(a)](b) All transactions made on the Exchange shall be submitted 
for clearance to the Clearing Corporation, and all such transactions 
shall be subject to the rules of the Clearing Corporation. Every 
Clearing Member shall be responsible for the clearance of the Exchange 
Transactions of such Clearing Member and of each Member who gives up 
such Clearing Member's name pursuant to a letter of authorization, 
letter of guarantee or other authorization given by such Clearing 
Member to such Member, which authorization must be submitted to the 
Exchange.
    [(b)](c) On each business day at or prior to such time as may be 
prescribed by the Clearing Corporation, the Exchange shall furnish the 
Clearing Corporation a report of each Clearing Member's matched trades.

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 ISE 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 
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
    When entering an order on the Exchange, certain information, such 
as account type (e.g., Public Customer or Firm Proprietary), must be 
indicated for the System to execute orders as specified in the 
Exchange's rules. Rather than relying upon ISE Rule 400 (Just and 
Equitable Principles of Trade) as the authority for the Exchange to 
conduct investigations and bring enforcement actions for 
misrepresenting trade information when entering orders, the Exchange 
proposes to adopt a rule specifying that Members are required to submit 
trade information to allow the Exchange to properly prioritize and 
match orders and quotations pursuant to the ISE Rule 713 (Priority of 
Quotes and Orders).
2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under section 6(b)(5)\3\ that an exchange have rules that 
are designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, and, in general, to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    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.

[[Page 2469]]

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

    Because the foregoing proposed rule change: (1) Does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
(3) does not become operative for 30 days from the date of filing; and 
(4) the Exchange provided the Commission with written notice of its 
intent to file the proposed rule change at least five days prior to the 
filing date, the proposed rule change has become effective pursuant to 
section 19(b)(3)(A) of the Exchange Act \4\ and Rule 19b-4(f)(6) \5\ 
thereunder.
---------------------------------------------------------------------------

    \4\ 156 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(f)6).
---------------------------------------------------------------------------

    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 apropriate 
in the public interest, for the protection of investors, or otherwise 
in 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. Persons making written submisssions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
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 these 
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's Public Reference. Room. Copies of such filing will also 
be available for inspection and copying at the principal office of the 
Exchange. All submissions should refer to File No. SR-ISE-00-21 and 
should be submitted by February 1, 2001.
---------------------------------------------------------------------------

    \6\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-792 Filed 1-10-01; 8:45 am]
BILLING CODE 8010-01-M