[Federal Register Volume 68, Number 235 (Monday, December 8, 2003)]
[Notices]
[Page 68440]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30356]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48857; File No. SR-NYSE-2002-40]


Self-Regulatory Organizations; Order Granting Approval of 
Proposed Rule Change by the New York Stock Exchange, Inc. (``NYSE'') To 
Establish Two New Crossing Sessions in the Exchange's Off-Hours Trading 
Facility

December 1, 2003.
    On August 29, 2002, the New York Stock Exchange, Inc. (``NYSE'') 
filed with the Securities and Exchange Commission (``SEC'' or 
``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to introduce into its rules ``Crossing Session 
III'' for the execution of guaranteed price coupled orders by member 
organizations to fill the balance of customer orders at a price that 
was guaranteed to a customer prior to the close of the Exchange's 9:30 
a.m. to 4 p.m. trading session. On August 14, 2003, the NYSE filed 
Amendment No. 1 to the proposed rule change.\3\ On October 8, 2003, the 
NYSE filed Amendment No. 2 to the proposed rule change.\4\ Amendment 
No. 1 would adopt a new Rule 907 to add a ``Crossing Session IV'' 
whereby an unfilled balance of an order may be filled at a price such 
that the entire order is filled at no worse price than the Volume 
Weighted Average Price (``VWAP'') for the subject security. Proposed 
Crossing Session III and Crossing Session IV would operate as a one-
year pilot. The proposed rule change and Amendment Nos. 1 and 2 thereto 
were published for notice and comment in the Federal Register on 
October 28, 2003.\5\ The Commission received no comments on the 
proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See letter from Mary Yeager, Assistant Secretary, NYSE, to 
Nancy J. Sanow, Assistant Director, Division of Market Regulation, 
SEC, dated August 13, 2003, and enclosure (``Amendment No. 1''). 
Amendment No. 1 proposes to add ``Crossing Session IV.''
    \4\ See letter from Darla C. Stuckey, Corporate Secretary, NYSE, 
to Nancy J. Sanow, Assistant Director, Division of Market 
Regulation, SEC, dated October 7, 2003, and enclosure (``Amendment 
No. 2''). Amendment No. 2 deletes the reference to a volume-weighted 
average price (``VWAP'') order from paragraph (c) of proposed Rule 
907.
    \5\ Securities Exchange Act Release No. 48659 (October 20, 
2003), 68 FR 61532.
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    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange \6\ and, in 
particular, the requirements of Section 6(b)(5) of the Act \7\ and the 
rules and regulations thereunder requiring that an exchange have rules 
that are designed to promote just and equitable principles of trade, 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 Commission believes that the 
proposed new crossing sessions may improve the transparency of these 
types of transactions which are currently often effected in non-U.S. 
markets without reporting. In approving Crossing Session I and Crossing 
Session II, the Commission granted exemptive relief from Rule 10a-1 
under the Act \8\ (short sale rule) for transactions effected therein; 
this exemptive relief is not being extended to transactions effected in 
Crossing Session III and Crossing Session IV.
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    \6\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78f(b)(5).
    \8\ 17 CFR 240.10a-1.
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (SR-NYSE-2002-40), be, and hereby 
is, approved.
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    \9\ 15 U.S.C. 78s(b)(2).

    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. 03-30356 Filed 12-5-03; 8:45 am]
BILLING CODE 8010-01-P