[Federal Register Volume 70, Number 159 (Thursday, August 18, 2005)]
[Notices]
[Pages 48610-48611]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-4509]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52248; File No. SR-CHX-2004-25]


Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing of Amendment No. 3 to a Proposed Rule Change Relating 
to a Prohibition on Using a Layoff Service Unless the Service Provides 
Required Information to the Exchange

August 12, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on August 12, 2005, the Chicago Stock Exchange, Inc. (``CHX'' or 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') Amendment No. 3 to a proposed rule change as described 
in Items I, II, and III below, which Items have been prepared by the 
CHX. The proposed rule change was originally filed on August 31, 2004 
and was amended by Amendment No. 1, filed on June 7, 2005, and 
Amendment No. 2, filed on June 27, 2005. The proposed rule change, as 
amended by Amendment Nos. 1 and 2, was published for notice and comment 
in the Federal Register on July 12, 2005.\3\ The Commission is 
publishing this notice to solicit comments on the proposed rule change, 
as amended by Amendment No. 3, from interested persons.
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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. 51967 (July 1, 
2005), 70 FR 40086 (July 12, 2005) (``First Notice'').
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is amending its proposal to prohibit Exchange 
Participants from using any communications means to send orders to 
another market for execution (a ``layoff service'') unless that layoff 
service has established a process for providing the Exchange with 
specific information about the orders and the executions that 
participants receive. This amendment changes the proposed effective 
date contained in the proposed rule text from August 1, 2005 to 
September 30, 2005.

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 CHX included statements 
concerning the purpose of and basis for the proposed rule changes 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 CHX 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 Changes

1. Purpose
    As noted in the original filing, the Exchange is proposing to amend 
its rule relating to communications from the trading floor to provide 
the Exchange with the layoff service information that it needs to 
enhance its surveillance programs. Through this Amendment No. 3, the 
Exchange is seeking to revise the proposed effective date of its 
proposed rule to September 30, 2005. The Exchange believes that this 
later effective date will better allow all of its Participants and 
their layoff vendors to be able to comply with the proposed rule in a 
timely manner on its effective date.
2. Statutory Basis
    The CHX believes the proposal is consistent with the requirements 
of the Act and the rules and regulations thereunder that are applicable 
to a national securities exchange, and, in particular, with the 
requirements of Section 6(b) of the Act.\4\ The CHX believes the 
proposal is consistent with Section 6(b)(5) of the Act \5\ in that it 
is designed to promote just and equitable principles of trade, to 
remove impediments, and to perfect the mechanism of, a free and open 
market and a national market system, and, in general, to protect 
investors and the public interest by permitting the Exchange to require 
its participants (or their layoff service providers) to provide the 
Exchange with data necessary to conduct appropriate surveillance of its 
participants' trading activities.
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    \4\ 15 U.S.C. 78(f)(b).
    \5\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement of Burden on Competition

    The Exchange does not believe that the proposed rule changes will 
impose any burden on competition.

[[Page 48611]]

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

    No written comments were either solicited or received.

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such other period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the Exchange consents, the Commission will:
    (A) By order approve the proposed rule change, as amended, or
    (B) Institute proceedings to determine whether the proposed rule 
change, as amended, should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended by Amendment No. 3, is consistent with the Act. 
Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-CHX-2004-25 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.
    All submissions should refer to File No. SR-CHX-2004-25. This file 
number should be included on the subject line if e-mail is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). 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 changes 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 CHX. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File No. SR-CHX-2004-25 and should be submitted on or before September 
8, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-4509 Filed 8-17-05; 8:45 am]
BILLING CODE 8010-01-P