[Federal Register Volume 73, Number 157 (Wednesday, August 13, 2008)]
[Notices]
[Pages 47247-47249]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-18700]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58323; File No. SR-YSE-2008-63]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Extend Until October 1, 2008 the Adoption of Interim NYSE Rule 128 
(Clearly Erroneous Executions)

August 6, 2008.
    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 July 28, 2008, New York Stock Exchange LLC (``NYSE'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been substantially prepared by the self-
regulatory organization. NYSE designated the proposed rule change as 
``non-controversial'' under Section 19(b)(3)(A)(iii) of the Act \3\ and 
Rule 19b-4(f)(6) 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)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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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 until October 1, 2008, the adoption 
of interim NYSE Rule 128 (``Clearly Erroneous Executions for NYSE 
Equities''). The text of the proposed rule change is available at the 
Exchange, the Commission's Public Reference Room, and 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, the self-regulatory organization 
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 those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in Sections A, B, and C below, of the most 
significant parts of such statements.

[[Page 47248]]

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 until October 1, 2008, the adoption 
of interim NYSE Rule 128 (``Clearly Erroneous Executions for NYSE 
Equities''), which permits the Exchange to cancel or adjust clearly 
erroneous executions if they arise out of the use or operation of any 
quotation, execution or communication system owned or operated by the 
Exchange, including those executions that occur in the event of a 
system disruption or system malfunction.
    Prior to the implementation of NYSE Rule 128 on January 28, 
2008,\5\ the NYSE did not have a rule providing the Exchange with the 
authority to cancel or adjust clearly erroneous trades of securities 
executed on or through the systems and facilities of the NYSE.
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    \5\ See Securities Exchange Act Release No. 57323 (February 13, 
2008), 73 FR 9371 (February 20, 2008) (SR-NYSE-2008-09).
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    In order for the NYSE to be consistent with other national 
securities exchanges which have some version of a clearly erroneous 
execution rule, the Exchange is drafting an amended clearly erroneous 
rule which will accommodate such other exchanges, but will be 
appropriate for the NYSE market model.
    Accordingly, the Exchange requests an extension until October 1, 
2008 of the adoption of NYSE Rule 128 in order to finalize its clearly 
erroneous rule. The NYSE is mindful that the Commission approved an 
amended clearly erroneous execution rule for Nasdaq in May 2008.\6\ The 
Exchange is currently reviewing the provisions in the Nasdaq's clearly 
erroneous execution rule and is considering the adoption of such 
provisions for an Exchange rule amendment.
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    \6\ See Securities Exchange Act Release No. 57826 (May 15, 
2008), 73 FR 29802 (May 22, 2008) (SR-NASDAQ-2007-001).
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
and furthers the objectives of Section 6(b)(5) of the Act,\7\ in that 
it is designed to prevent fraudulent and manipulative practices, to 
promote just and equitable principles of trade, to remove impediments 
to and perfect the mechanisms of a free and open market and a national 
market system, and, in general, to protect investors and the public 
interest.
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    \7\ 15 U.S.C. 78f(b)(5).
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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 the purposes of the Act.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    Because the proposed rule change does not: (i) Significantly affect 
the protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days after the date of filing, or such shorter time as the Commission 
may designate if consistent with the protection of investors and the 
public interest, the proposed rule change has become effective pursuant 
to Section 19(b)(3)(A) of the Act \8\ and subparagraph (f)(6) of Rule 
19b-4 thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) normally may 
not become operative prior to the 30th day after the date of 
filing.\10\ However, Rule 19b-4(f)(6)(iii) \11\ permits the Commission 
to designate a shorter time if such action is consistent with the 
protection of investors and the public interest.\12\
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    \10\ See 17 CFR 240.19b-4(f)(6)(iii).
    \11\ Id.
    \12\ In addition, Rule 19b-4(f)(6)(iii) requires a self-
regulatory organization to give the Commission written notice of its 
intent to file the proposed rule change at least five business days 
prior to the date of filing of the proposed rule change, or such 
shorter time as designated by the Commission. The Commission has 
determined to waive the five-day prefiling period in this case.
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    The Exchange has requested that the Commission waive the 30-day 
operative delay. The Exchange believes that the waiver of this period 
will allow it to immediately and timely enable the NYSE to cancel or 
adjust clearly erroneous trades that may present a risk to the 
integrity of the equities markets and all related markets. According to 
the Exchange, the proposed rule change also will allow the Exchange to 
protect customers and the public interest and to continue to provide 
economically efficient execution of securities transactions.
    The Commission believes that waiving the 30-day operative delay 
will allow the Exchange to continue to immediately and timely cancel or 
adjust trades that it determines to be clearly erroneous under Rule 
128. The Commission believes that the extension of NYSE Rule 128 until 
October 1, 2008 will allow the Exchange to continue to apply the rule 
without interruption and is consistent with the protection of investors 
and the public interest. The Commission hereby designates the proposal 
as operative upon filing.\13\
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    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate the 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.

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-2008-63 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSE-2008-63. 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

[[Page 47249]]

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 the NYSE. 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 Number SR-NYSE-2008-63 and should be submitted on or before 
September 3, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-18700 Filed 8-12-08; 8:45 am]
BILLING CODE 8010-01-P