[Federal Register Volume 69, Number 57 (Wednesday, March 24, 2004)]
[Notices]
[Page 13919]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-6590]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49438; File No. SR-AMEX-2003-78]


Self-Regulatory Organizations; American Stock Exchange LLC; Order 
Approving a Proposed Rule Change Relating To Resolving Uncompared 
Options Transactions

March 17, 2004.
    On August 27, 2003, the American Stock Exchange LLC (``Amex'') 
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\ Notice of the proposal was published 
in the Federal Register on January 13, 2004.\2\ No comment letters were 
received. For the reasons discussed below, the Commission is approving 
the proposed rule change.
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    \1\ 15 U.S.C 78s(b)(1).
    \2\ Securities Exchange Act Release No. 49024 (Jan. 6, 2004), 69 
FR 2025.
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I. Description

    Amex will amend Rule 970 (Comparison of Option Transactions 
Excluded From Clearance) to reflect new procedures for resolving 
uncompared transactions in its Intra-Day Comparison System for Options 
(``IDCO''). The new IDCO format will now be consistent with Amex Rule 
731, which governs the process for resolving uncompared equity 
transactions and the use of the Intra-Day Comparison System for 
Equities (``IDCE''). Specifically, members must now reconcile their 
uncompared options transactions through Amex's electronic on-line 
comparison system and will no longer use or manually sign paper 
Rejected Options Transaction Notices. Each member will be responsible 
for reviewing its uncompared transactions displayed on the system 
terminal and make any necessary modifications to the data according to 
Amex guidelines. All uncompared transactions that remain uncompared in 
the system must be resolved no later than such time as Amex shall from 
time to time determines. For clarity and consistency, Amex will 
preserve the former Rule 970 language in the new Commentary to Rule 
970.

II. Discussion

    Section 6(b)(5) of the Act \3\ requires, among other things, that 
the rules of a national securities exchange be designed to remove the 
impediments to and perfect the mechanism of a national market system. 
The Commission finds that Amex's proposed rule change is consistent 
with this obligation because the new IDCO procedures, by utilizing 
current data processing and communications technology, will automate 
and should accelerate the reconciliation process for uncompared options 
transactions. In turn, this should reduce the risks and inefficiencies 
inherent in the use of paper documents in the post-trade processing of 
options transactions.
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    \3\ 15 U.S.C. 78f(b)(5).
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III. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposal is consistent with the requirements of the Act and in 
particular with the requirements of section 6(b)(5) of the Act \4\ and 
the rules and regulations thereunder.
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    \4\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to section 19(b)(2) of the Act, 
that the proposed rule change (File No. SR-AMEX-2003-78) be, and hereby 
is, approved.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-6590 Filed 3-23-04; 8:45 am]
BILLING CODE 8010-01-P