[Federal Register Volume 69, Number 145 (Thursday, July 29, 2004)]
[Notices]
[Pages 45356-45357]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-17293]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50067; File No. SR-OPRA-2004-03]


Options Price Reporting Authority; Order Approving an Amendment 
to the Plan for Reporting of Consolidated Options Last Sale Reports and 
Quotation Information To Revise Guideline 1 of the Capacity Guidelines 
To Confirm That it Is Within the Authority of the Independent System 
Capacity Advisor To Make Determinations Concerning the Establishment, 
Modification or Removal of Output Throttles From the OPRA System

July 22, 2004.
    On May 7, 2004, the Options Price Reporting Authority (``OPRA'') 
submitted to the Securities and Exchange Commission (``Commission''), 
pursuant to section 11A of the Securities Exchange Act of 1934 
(``Act'')\1\ and Rule 11Aa3-2 thereunder,\2\ an amendment to the Plan 
for Reporting of Consolidated Options Last Sale Reports and Quotation 
Information (``OPRA Plan'' or ``Plan'').\3\ The proposed amendment 
would revise Guideline 1 of the Capacity Guidelines to confirm that it 
is within the authority of the Independent System Capacity Advisor 
(``ISCA'') under the OPRA Plan to make determinations concerning the 
establishment, modification or removal of any throttle on the output of 
the OPRA System. Notice of the proposal was published in the Federal 
Register on June 23, 2004.\4\ The Commission received no comment 
letters on the proposed OPRA Plan amendment. This order approves the 
proposal.
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 240.11Aa3-2.
    \3\ OPRA is a national market system plan approved by the 
Commission pursuant to Section 11A of the Act and Rule 11Aa3-2 
thereunder. See Securities Exchange Act Release No. 17638 (March 18, 
1981), 22 S.E.C. Docket 484 (March 31, 1981).
    The OPRA Plan provides for the collection and dissemination of 
last sale and quotation information on options that are traded on 
the participant exchanges. The six participants to the OPRA Plan are 
the American Stock Exchange LLC, the Boston Stock Exchange, Inc., 
the Chicago Board Options Exchange, Inc., the International 
Securities Exchange, Inc., the Pacific Exchange, Inc., and the 
Philadelphia Stock Exchange, Inc.
    \4\ See Securities Exchange Act Release No. 49871 (June 16, 
2004), 69 FR 35082.
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    Guideline 1 of the Capacity Guidelines in the OPRA Plan sets forth 
the ``Function and Authority of the ISCA.'' The purpose of the proposed 
amendment to Guideline 1 is to include in the Capacity Guidelines an 
express statement that the authority of the ISCA would include the 
authority to establish a throttle limiting the output of the System to 
less than the total capacity available in the System, and to modify or 
remove any such throttles that may be established from time to time.\5\ 
OPRA believes that throttling System output to less than total System 
capacity could sometimes be an appropriate way to limit the maximum 
message-handling capacity that vendors and subscribers would be 
required to have.
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    \5\ The output throttle that is the subject of the proposed 
amendment would serve to limit the total output of the OPRA System. 
It would be different from the OPRA System's ``dynamic throttle,'' 
which allows any unused System capacity to be temporarily and 
dynamically allocated to a participant exchange that needs 
additional capacity on a short-term, interruptible basis. Telephone 
conversation between Michael L. Meyer, Counsel to OPRA, Schiff 
Hardin LLP, and Cyndi N. Rodriguez, Special Counsel, Division of 
Market Regulation, Commission, on June 14, 2004.
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    After careful review, the Commission finds that the proposed OPRA 
Plan amendment is consistent with the requirements of the Act and the 
rules and regulations thereunder.\6\ The Commission believes that the 
proposed OPRA Plan amendment is consistent with Section 11A of the Act 
\7\ and Rule 11Aa3-2 thereunder \8\ in that it is appropriate in the 
public interest, for the protection of investors and the maintenance of 
fair and orderly markets, to remove impediments to, and perfect the 
mechanisms of, a national market system.
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    \6\ In approving this proposed OPRA Plan amendment, the 
Commission has considered its impact on efficiency, competition, and 
capital formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78k-1.
    \8\ 17 CFR 240.11Aa3-2.
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    Specifically, given the recent establishment of the ISCA and its 
responsibilities in planning and implementing System modifications, the 
Commission finds that it is appropriate for OPRA to clarify in the Plan 
the ISCA's authority to make decisions with respect to System output 
throttles. The Commission believes that providing the ISCA with this 
authority should ensure that these decisions are not influenced by 
competitive considerations among the parties to the OPRA Plan.
    It is therefore ordered, pursuant to section 11A of the Act,\9\ and 
Rule 11Aa3-2 thereunder,\10\ that the proposed OPRA Plan amendment (SR-
OPRA-2004-03) be, and it hereby is, approved.
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    \9\ 15 U.S.C. 78k-1.
    \10\ 17 CFR 240.11Aa3-2.


[[Page 45357]]


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    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(29).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-17293 Filed 7-28-04; 8:45 am]
BILLING CODE 8010-01-P