[Federal Register Volume 67, Number 44 (Wednesday, March 6, 2002)]
[Notices]
[Pages 10244-10245]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-5271]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45481; File No. SR-CHX-2002-01]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by The Chicago Stock Exchange, 
Incorporated to Extend Pilot Rules for Decimals

February 27, 2002.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on January 14, 2002, the Chicago Stock Exchange, Incorporated 
(``CHX'' 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 CHX. 
The Exchange filed the proposal pursuant to section 19(b)(3)(A) of the 
Act,\3\ and Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal 
effective upon filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange proposes to extend through April 15, 2002, the pilot 
rules amending certain CHX rules that were impacted by the securities 
industry transition to a decimal pricing environment. The pilot rules 
are due to expire on January 14, 2002. The CHX does not propose any 
substantive or typographical changes to the pilot; the only change is 
an extension of the pilot's expiration date through April 15, 2002. The 
text of the proposed rule change is available at the Commission and at 
the CHX.

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 CHX included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received regarding the proposed rule change. 
The text of these statements may be examined at the places specified in 
Item IV below. The CHX 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 August 24, 2000, the Commission approved, on a pilot basis 
through February 28, 2001, changes proposed by the Exchange to amend 
certain CHX rules that would be impacted by the securities industry 
transition to a decimal pricing environment.\5\ The pilot was extended 
three times.\6\ The Exchange now requests an extension of the current 
pilot through April 15, 2002. The CHX does not propose to make any 
substantive or typographical changes to the pilot.
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    \5\ See Securities Exchange Act Release No. 43204 (August 24, 
2000), 65 FR 53065 (August 31, 2000) (SR-CHX-00-22).
    \6\ See Securities Exchange Act Release Nos. 43974 (February 16, 
2001), 66 FR 11621 (February 26, 2001) (SR-CHX-2001-03) (extending 
pilot through July 9, 2001); 44488 (June 28, 2001), 66 FR 35684 
(July 6, 2001) (SR-CHX-2001-13) (extending pilot through November 5, 
2001); and 45059 (November 15, 2001), 66 FR 58543 (November 21, 
2001) (SR-CHX-2001-20) (extending pilot through January 14, 2002).
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2. Statutory Basis
    The CHX believes the proposal is consistent with the requirements 
of the Act and the rules and regulations thereunder that are applicable 
to a national securities exchange, and, in particular, with the 
requirements of section 6(b).\7\ The CHX believes the proposal is 
consistent with section 6(b)(5) of the Act \8\ in that it is designed 
to promote just and equitable principles of trade, to remove 
impediments, and to perfect the mechanism of, a free and open market 
and a national market system, and, in general, to protect investors and 
the public interest.
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    \7\ 15 U.S.C. 78(f)(b).
    \8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement of Burden on Competition

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

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not:
    (i) Significantly affect the protection of investors or the public 
interest;
    (ii) Impose any significant burden on competition; and
    (iii) Become operative for 30 days from the date on which it was 
filed, or such shorter time as the Commission may designate, it has 
become effective pursuant to section 19(b)(3)(A) of the Act \9\ and 
Rule 19b-4(f)(6) thereunder.\10\ 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 appropriate in the public interest, for the 
protection of investors, or otherwise in furtherance of the purposes of 
the Act.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6).
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    The Exchange has requested that the Commission waive the 5-day pre-
filing requirement and accelerate the operative date. The Commission 
finds good cause to waive the 5-day pre-filing requirement and to 
designate the proposal to become operative immediately because such 
designation is consistent with the protection of investors and the 
public interest. Acceleration of the operative date and waiver of the 
5-day pre-fling

[[Page 10245]]

requirement will allow the pilot to continue uninterrupted through 
April 15, 2002, the deadline by which self-regulatory organizations 
must file proposed rule changes to set the minimum price variation for 
quoting in a decimals environment. For these reasons, the Commission 
finds good cause to designate that the proposal is both effective and 
operative upon filing with the Commission.\11\
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    \11\ For purposes only of waiving the 5-day pre-filing 
requirement and accelerating the operative date of this proposal, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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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 CHX. All 
submissions should refer to File No. SR-CHX-2002-01 and should be 
submitted by March 27, 2002.


    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-5271 Filed 3-5-02; 8:45 am]
BILLING CODE 8010-01-P