[Federal Register Volume 67, Number 116 (Monday, June 17, 2002)]
[Notices]
[Pages 41288-41289]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-15137]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-46055; File No. SR-PCX-2002-31]


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 Automatic Opening Rotations 
Pilot Program

June 10, 2002.
    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 May 31, 2002, the Pacific Exchange, Inc. (``Exchange'' or ``PCX'') 
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 PCX. The proposed rule change has been 
filed by the PCX as a ``non-controversial'' rule change under Rule 19b-
4(f)(6) under the Act.\3\ 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.
    \3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

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

    PCX proposes to extend its Automated Opening Rotations (``AOR'') 
pilot program for one year, until September 30, 2003. The text of the 
proposed rule change is available at the Office of the Secretary, PCX, 
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 with the Commission, the PCX 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 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.\4\ On August 
21, 2000 \5\ and August 13, 2001,\6\ respectively, the Commission 
granted one-year extensions to the pilot program. The extension program 
is currently set to expire on September 30, 2002.\7\ AOR provides a 
procedure to facilitate the execution of option 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.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 41970 (September 30, 
1999), 64 FR 54713 (October 7, 1999).
    \5\ See Securities Exchange Act Release No. 43187 (August 21, 
2000), 65 FR 52464 (August 29, 2000).
    \6\ See Securities Exchange Act Release No. 44688 (August 13, 
2001) 66 FR 43600 (August 20, 2001).
    \7\ Id.
---------------------------------------------------------------------------

    The Exchange is requesting an additional one-year extension of the 
pilot program from September 30, 2002 to September 30, 2003. 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) of the Act \8\ in general, and furthers the 
objectives of section 6(b)(5) of the Act \9\ in particular, because it 
is designed to promote just and equitable principles of trade.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change will 
impose

[[Page 41289]]

any inappropriate burden on competition that is not necessary 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 proposed rule change has become effective pursuant to 
section 19(b)(3)(A) \10\ of the Act and Rule 19b-4(f)(6) \11\ 
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 
for 30 days from 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.\12\ 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.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ As required under Rule 19b-4(f)(6)(iii), the Exchange 
provided the Commission with written notice of its intent to file 
the proposed rule change at least five business days prior to the 
filing date.
---------------------------------------------------------------------------

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 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-2002-31 and should 
be submitted by July 8, 2002.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
[FR Doc. 02-15137 Filed 6-14-02; 8:45 am]
BILLING CODE 8010-01-P