[Federal Register Volume 67, Number 193 (Friday, October 4, 2002)]
[Notices]
[Page 62276]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-25225]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-46568; File No. SR-Amex-2002-23]


Self-Regulatory Organizations; the American Stock Exchange LLC; 
Order Granting Approval to a Proposed Rule Change To Make Permanent a 
Pilot Program Under Amex Rule 126(g), Commentary .01, Relating to Size 
Precedence

September 27, 2002.
    On March 22, 2002, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') a proposed rule change pursuant to section 19(b)(1) of 
the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 
thereunder.\2\ The proposed rule change would make permanent a pilot 
program under Amex Rule 126(g), Commentary .01, regarding a 5,000 share 
minimum block cross size to establish size precedence. The pilot 
program was established in SR-Amex-2001-01, and has been in operation 
since March 28, 2001.\3\ Notice of the proposed rule change was 
published in the Federal Register on April 3, 2002).\4\ The Commission 
received no comments on the proposal.
    The Commission has reviewed carefully the Amex's proposed rule 
change, and finds, for the reasons set forth below, that the proposal 
is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange, 
and, in particular, with the requirements of section 6(b)(5) \5\ of the 
Act. Section 6(b)(5) requires the rules of a registered national 
securities exchange be 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 
regulating, clearing, settling, processing information with respect to, 
and facilitating transactions in securities, 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. The Exchange has represented that the reduction in the size 
precedence for clean crosses does not impair the application of Amex 
Rule 152, which provides price improvement opportunities for all or a 
portion of one side of a proposed cross.\6\ Moreover, the Commission 
finds that the size precedence reduction for clean crosses from 25,000 
to 5,000 shares reflects an appropriate adjustment to a decimalized 
environment in which the minimum price variation for equity quotes has 
been reduced from the fractional equivalent of slightly over six cents 
to one cent. For these reasons, the Commission finds that the proposed 
rule change is consistent with the provisions of the Act, in general, 
and with section 6(b)(5).\7\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 44122 (March 28, 
2001), 66 FR 18125 (April 5, 2001).
    \4\ Securities Exchange Act Release No. 45660 (March 27, 2002), 
67 FR 15841.
    \5\ 15 U.S.C. 78f(b)(5).
    \6\ See September 17, 2002 letter from Michael Cavalier, 
Associate General Counsel, Amex, to Nancy Sanow, Assistant Director, 
Division of Market Regulation, Commission.
    \7\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\8\ that the proposed rule change (SR-Amex-2002-23) be, and hereby 
is, approved.\9\
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    \8\ 15 U.S.C. 78s(b)(2).
    \9\ In approving the proposal, the Commission has considered the 
rule's impact on efficiency, competition, and capital formation. 15 
U.S.C. 78c(f).

    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. 02-25225 Filed 10-3-02; 8:45 am]
BILLING CODE 8010-01-P