[Federal Register Volume 70, Number 174 (Friday, September 9, 2005)]
[Notices]
[Pages 53704-53705]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-4919]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52361; File No. SR-PCX-2005-58]


Self-Regulatory Organizations; Pacific Exchange, Inc.; Order 
Approving Proposed Rule Change and Amendments Nos. 1 and 2 Thereto 
Relating to Market Order Auction

August 30, 2005.
    On April 22, 2005, the Pacific Exchange, Inc. (``PCX''), through 
its wholly owned subsidiary PCX Equities, Inc. (``PCXE'') filed with 
the Securities and Exchange Commission (``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 amend its rules 
governing the Market Order Auction of the Archipelago Exchange 
(``ArcaEx''), the equities trading facility of PCXE. On June 27, 2005, 
the Exchange amended the proposed rule change and on July 8, 2005, the 
Exchange further amended the proposed rule change. The proposed rule 
change, as amended, was published for notice and comment in the Federal 
Register on July 29, 2005.\3\ The Commission received no comment 
letters on the proposal.
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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. 52103 (July 21, 
2005), 70 FR 43924.
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    The proposed rule change would clarify the Indicative Match Price 
definition as defined in PCXE Rule 1.1(r) which determines the price at 
which orders eligible for execution in the ArcaEx auctions are 
executed. The proposed rule change would also modify the Market Order 
Auction rules as described in PCXE Rule 7.35 and implement price 
collars based on a similar standard currently in place for ArcaEx's 
Closing Auction.
    The Commission finds that the proposed rule change, as amended, is 
consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange.\4\ 
In particular, the

[[Page 53705]]

Commission finds that the proposed rule change is consistent with 
Section 6(b)(5) of the Act,\5\ which requires, among other things, that 
the rules of an exchange be 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 and, in general, to protect investors and the 
public interest. The Commission believes that clarifying and improving 
the Market Order Auction pricing mechanism on ArcaEx should provide 
investors with a clearerunderstanding of how orders will be priced at 
the open and may provide greater assurance that orders will be priced 
at prices that are substantially close to where the stock is trading.
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    \4\ 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).
    \5\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\6\ that the proposed rule change (SR-PCX-2005-58), as amended, be 
hereby approved.
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    \6\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. E5-4919 Filed 9-8-05; 8:45 am]
BILLING CODE 8010-01-P