[Federal Register Volume 73, Number 70 (Thursday, April 10, 2008)]
[Notices]
[Pages 19542-19544]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-7513]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57617; File No. SR-NYSE-2008-25]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Extend the Pilot Program for Providing Liquidity on the NYSE Bonds\SM\ 
System

April 4, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on March 31, 2008, the New York Stock Exchange LLC ( ``NYSE'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items

[[Page 19543]]

have been substantially prepared by NYSE. The Exchange has designated 
this proposal as one establishing or changing a due, fee, or other 
charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act 
\3\ and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to extend the pilot program pursuant to which 
liquidity providers receive a $20 credit for bond trades executed on 
the NYSE Bonds\SM\ system (``NYSE Bonds'') with an execution size of 
less than 20 bonds. The text of the proposed rule change is available 
at the Exchange's principal office, in the Commission's Public 
Reference Room, and at http://www.nyse.com.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, NYSE included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. NYSE 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 Change

1. Purpose
    The Exchange proposes to extend for nine months the pilot program 
pursuant to which liquidity providers receive a $20 credit for bond 
trades executed on NYSE Bonds with an execution size of less than 20 
bonds. The pilot program would thus end on December 31, 2008.
    A liquidity provider is one who posts liquidity to NYSE Bonds. 
During the course of clearing their bond trades, liquidity providers 
absorb clearing costs. In order to offset these clearing costs, 
liquidity providers may increase the offer price or decrease the bid 
price of the bond. In doing so, the best execution of a bond order may 
be compromised, as clearing costs increase with smaller orders.
    Accordingly, the Exchange proposes that liquidity providers 
continue to be issued a $20 credit for executions of bond orders with 
an execution size of less than 20 bonds through December 31, 2008. For 
a liquidity provider to be eligible to receive this $20 credit, the 
original order posted by the liquidity provider must be for 20 bonds or 
more. For example, if a liquidity provider posts an order for 100 bonds 
and a contra side order comes in for 50 bonds, the liquidity provider 
will not receive a $20 credit. However, if a contra side order comes in 
for 10 bonds against the liquidity provider's original posted order of 
100 bonds, the liquidity provider will receive a credit of $20 from the 
Exchange for that execution.
    NYSE Bonds, which was implemented in March 2007, will continue to 
update its functionality to provide competitive bond trading for 
customers. The Exchange believes that this $20 credit will continue to 
incentivize liquidity providers to display the best price available on 
NYSE Bonds.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act \5\ in general and furthers 
the objectives of Section 6(b)(4) of the Act \6\ in particular, in that 
it is designed to provide for the equitable allocation of reasonable 
dues, fees, and other charges among its members and other persons using 
its facilities.
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    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of purposes of the Act.

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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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

    Because the foregoing rule change establishes or changes a due, 
fee, or other charge imposed by the Exchange, it has become effective 
pursuant to Section 19(b)(3)(A) of the Act \7\ and subparagraph (f)(2) 
of Rule 19b-4 thereunder.\8\ At any time within 60 days of the filing 
of the proposed rule change, the Commission may summarily abrogate such 
rule change if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change 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-NYSE-2008-25 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSE-2008-25. 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 change 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, 100 F Street, NE, 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of such filing also will be available for 
inspection and copying at the principal office of NYSE. All comments 
received will be posted

[[Page 19544]]

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 Number SR-NYSE-2008-25 and should be submitted on or before May 1, 
2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-7513 Filed 4-9-08; 8:45 am]
BILLING CODE 8011-01-P