[Federal Register Volume 66, Number 161 (Monday, August 20, 2001)]
[Notices]
[Pages 43600-43601]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-20858]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-44688; File No. SR-PCX-2001-31]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc. 
Relating to a One-Year Extension of the AOR Pilot Program

August 13, 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 August 8, 2001, the Pacific Exchange, Inc. (``PCX'' 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 prepared by the Exchange. 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.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange is proposing to extend its Automated Opening Rotations 
(``AOR'') pilot program for one year. The text of the proposed rule 
change follows. Deleted text is bracketed. New text is italicized.
para.5073  Trading Rotations
    Rule 6.64(a)-(g)--No change.
Commentary
    .01--No Change
    .02  Pilot Program. The Automated Opening Rotation System is 
subject to a [one year] pilot program, which is set to expire on 
[September 28, 2001] September 30, 2002.

[[Page 43601]]

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. PCX 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
    On September 30, 1999, the Commission approved a one-year pilot 
program for the operation of the Exchange's AOR System.\3\ On August 
21, 2000, the Commission granted a one-year extension to the pilot 
program.\4\ The extension program is currently set to expire on 
September 28, 2001.\5\ AOR provides a procedure to facilitate the 
execution of options orders at the opening by providing an electronic 
means of establishing a single price opening. In its order approving 
the pilot program, the Commission stated that it expects the Exchange 
to study the issues related to the Commission's concerns during the 
pilot period and to report back to the Commission at least sixty days 
prior to seeking permanent approval of AOR.
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    \3\ See Securities Exchange Act Release No. 41970 (September 30, 
1999), 64 FR 54713 (October 7, 1999).
    \4\ See Securities Exchange Act Release No. 43187 (August 21, 
2000), 64 FR 52464 (August 29, 2000).
    \5\ Id.
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    The Exchange is requesting an additional extension of the pilot 
program until the Commission grants permanent approval or one year, 
whichever occurs first. The added time permits the Exchange an 
opportunity to continue reviewing and evaluating the program in order 
to properly address the Commission's concerns before seeking permanent 
approval. The Exchange believes that this program is operating 
successfully and without any problems, and on that basis, the Exchange 
believes that a one-year extension of the program is warranted. At this 
time, the Exchange is not seeking to modify the pilot program.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) \6\ of the Act, in general, and furthers the 
objectives of Section 6(b)(5),\7\ in particular, in that it is designed 
to promote just and equitable principles of trade.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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 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 written comments on 
the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) \9\ thereunder because 
the proposal: (1) Does not significantly affect the protection of 
investors or the public interest; (2) does not impose any significant 
burden on competition; and (3) does not become operative prior to 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; provided that the Exchange has given the Commission 
written notice of its intent to file the proposed rule change at least 
five business days prior to the filing date of the proposed rule 
change. At any time within 60 days of the filing of such 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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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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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 proposal is 
consistent with the Act. Persons making written submissions 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 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 PCX. All 
submissions should refer to File No. SR-PCX-2001-31 and should be 
submitted by September 10, 2001.

    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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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-20858 Filed 8-17-01; 8:45 am]
BILLING CODE 8010-01-M