[Federal Register Volume 66, Number 221 (Thursday, November 15, 2001)]
[Notices]
[Pages 57495-57496]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28586]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45045; File No. SR-Amex-2001-94]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the American Stock Exchange LLC to Increase to Two Hundred 
and Fifty the Maximum Permissible Number of Equity and Index Option 
Contracts Executable Through AUTO-EX

November 7, 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 October 29, 2001, the American Stock Exchange LLC (``Amex'' 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 Amex. The

[[Page 57496]]

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 Amex proposes to increase to 250 contracts the maximum 
permissible number of equity and index option contracts in an order 
executable through its automatic execution system, AUTO-EX. The text of 
the proposed rule change is available at the Office of the Secretary, 
Amex and at the Commission.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing the Commission, the Amex 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 Amex 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
    In 1985, the Exchange implemented the AUTO-EX system, which 
automatically executes public customer market and marketable limit 
orders in options at the best bid or offer displayed at the time the 
order is entered into the Amex Order File (``AOF''). There are, 
however, limitations on the number of option contracts that can be 
entered into or executed by these systems. AOF, which handles limit 
orders routed to the specialist's book as well as orders routed to 
AUTO-EX, was recently increased to allow for the entry of orders of up 
to 2500 option contracts.\3\ AUTO-EX, however, is only permitted to 
execute equity option orders and index option orders of up to 100 
contracts.\4\ Thus, market and marketable limit orders of more than 100 
contracts are routed by AOF to the specialist's book.
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    \3\ See Securities Exchange Act Release No. 44065 (March 12, 
2001), 66 FR 15513 (March 19, 2001).
    \4\ See Securities Exchange Act Release No. 43887 (January 25, 
2001), 66 FR 8831 (February 2, 2001).
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    The Exchange now proposes to increase to 250 contracts the maximum 
permissible number of equity and index options contracts in an order 
that can be executed through the AUTO-EX system. It is proposed that 
this increase to 250 contracts in permissible order size for AUTO-EX be 
implemented on a case-by-case basis for an individual option class or 
for all option classes when two floor governors or senior floor 
officials deem such an increase appropriate. Currently, the Amex posts 
applicable quote size parameters on its web page. The Exchange 
represents that it has sufficient systems capacity necessary to 
accommodate implementation of the proposed increased.
    The Exchange represents that AUTO-EX has been extremely successful 
in enhancing execution and operational efficiencies during emergency 
situations and during other, non-emergency situations for certain 
option class. The Exchange believes that automatic executions of orders 
for up to 250 contracts will allow for the quick, efficient execution 
of public customer orders.
2. Statutory Basis
    The proposed rule change is consistent with section 6(b) \5\ of the 
Act, in general, and furthers the objectives of section 6(b)(5),\61\ in 
particular, in that it is designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in facilitating transactions in securities, and to 
remove impediments to and perfect the mechanism of a free and open 
market and a national market system.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Amex does not believe that the proposed rule change will impose 
any burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received from Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

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 Exchange 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

    The Commission invites interested persons to submit written data, 
views, and arguments concerning the foregoing, including whether the 
proposed rule change 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 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 Amex. All 
submissions should refer to File No. SR-Amex-2001-94 and should be 
submitted by December 6, 2001.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-28586 Filed 11-14-01; 8:45 am]
BILLING CODE 8010-01-M