[Federal Register Volume 68, Number 183 (Monday, September 22, 2003)]
[Notices]
[Pages 55072-55073]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-24088]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48494; File No. SR-Amex-2003-79]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the American Stock Exchange 
LLC To Make Permanent Procedures on the Amex in Nasdaq National Market 
Securities

September 16, 2003.
    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 September 5, 2003, 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 and 
II below, which Items have been prepared by the Exchange. 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.\5\ 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).
    \5\ The Exchange provided the Commission with notice of its 
intention to file this proposed rule change on August 29, 2003. The 
Commission reviewed the pre-filing notice and advised the Amex to 
file the proposed rule change. See August 29, 2003 email letter to 
Claire McGrath, Senior Vice President and Deputy General Counsel, 
Amex, from Joseph P. Morra, Special Counsel, Division of Market 
Regulation (``Division''), Commission. The Amex asked the Commission 
to waive the 30-day operative delay. See Rule 19b-4(f)(6)(iii). 17 
CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Amex proposes to implement on a permanent basis crossing 
procedures on the Amex in Nasdaq National Market securities under 
Commentary .06 to Amex Rule 126(g). These procedures are currently 
implemented on a pilot basis, and are set to expire on September 30, 
2003. The text of the proposed rule change is available at the 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 with the Commission, the Exchange included statements 
concerning the purpose of and basis for its proposal and discussed any 
comments it received regarding the proposal. 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
    The Amex has implemented crossing procedures under Amex Rule 
126(g), Commentary .06 on a pilot basis extending until September 30, 
2003.\6\ The Exchange initially filed the pilot program on July 18, 
2002 \7\ and subsequently extended the program until March 31, 2003.\8\ 
The Exchange proposes that the procedures under Amex Rule 126(g), 
Commentary .06 become permanently effective.
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    \6\ See Securities Exchange Act Release No. 47622 (April 2, 
2003), 68 FR 17416 (April 9, 2003(SR-Amex-2003-20).
    \7\ See Securities Exchange Act Release No. 46309 (August 5, 
2002), 67 FR 59102 (August 9, 2002)(SR-Amex-2002-58).
    \8\ See Securities Exchange Act Release No. 46635 (October 10, 
2002), 67 FR 64424 (October 18, 2002)(SR-Amex-2002-74).
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    Amex Rule 126(g), Commentary .06 provides that a floor broker is 
permitted to effect cross transactions in Nasdaq National Market 
securities involving 5,000 shares or more without interference by the 
specialist or market makers if, prior to presenting the cross 
transaction, the floor broker first requests a quote for the subject 
security. These requests place the specialist and market makers on 
notice that the floor broker intends to cross within the bid-offer 
spread. This arrangement ensures that a specialist or market maker 
retains the opportunity to better the cross price by updating their 
quote, but precludes the specialist or market maker from breaking up a 
cross transaction after the cross transaction is presented. The floor 
broker retains the ability to present both sides of the order at the 
post if the customers so desire.
    The Exchange is making no change to Amex Rule 126(g), Commentary 
.06 as filed with the Commission in SR-Amex-2002-58, other than to 
implement Commentary .06 on a permanent basis. The Exchange is making 
no change to the manner in which crossing procedures under the pilot 
program currently operate.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act \9\ in general, and furthers the objectives of Section 
6(b)(5) \10\ 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, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, to protect investors and the public interest 
and is not designed to permit unfair discrimination between customers, 
issuers, brokers, or dealers.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 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.

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

    The Exchange did not receive any written comments on the proposed 
rule change.

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

    Because the foregoing proposed rule change does not:

[[Page 55073]]

    (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 \11\ and 
Rule 19b-4(f)(6) thereunder.\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.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6).
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    The Amex has requested that the Commission waive the 30-day 
operative delay. The Commission believes waiving the 30-day operative 
delay is consistent with the protection of investors and the public 
interest. Acceleration of the operative date will make the pilot 
permanent without requiring the Amex to file another proposed rule 
change to extend the pilot long enough to allow the 30-day operative 
period to expire. For these reasons, the Commission designates the 
proposal to be effective and operative upon filing with the 
Commission.\13\
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    \13\ For purposes only of 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 Amex. All 
submissions should refer to file number SR-Amex-2003-79 and should be 
submitted by October 14, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-24088 Filed 9-18-03; 12:01 pm]
BILLING CODE 8010-01-U