[Federal Register Volume 73, Number 195 (Tuesday, October 7, 2008)]
[Notices]
[Page 58698]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-23614]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 58711]


Order Extending Emergency Order Pursuant to Section 12(k)(2) of 
the Securities Exchange Act of 1934 Taking Temporary Action To Respond 
to Market Developments

October 1, 2008.
    Pursuant to Section 12(k)(2) of the Securities Exchange Act of 1934 
(``Exchange Act''),\1\ on September 17, 2008, the Securities and 
Exchange Commission (``Commission'') issued an Emergency Order (the 
``Order'') aimed at further reducing fails to deliver and addressing 
potentially abusive ``naked'' short selling in all equity 
securities.\2\ The Order became effective at 12:01 a.m. E.D.T. on 
September 18, 2008 and is currently set to terminate at 11:59 p.m. 
E.D.T. on October 1, 2008.
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    \1\ 15 U.S.C. 78l(k)(2).
    \2\ See Securities Exchange Act Release No. 58572 (Sept. 17, 
2008).
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    Pursuant to our authority under Section 12(k)(2)(C) of the Exchange 
Act, we are extending the Order. Section 12(k)(2)(C) authorizes the 
Commission to extend an emergency order issued pursuant to Section 
12(k)(2)(A) of the Exchange Act for a total effective period of up to 
30 calendar days, if the Commission finds that the emergency still 
exists and determines that an extension is necessary in the public 
interest and for the protection of investors to maintain fair and 
orderly securities markets.
    We have carefully reevaluated the current state of the markets and 
we remain concerned about the potential of sudden and excessive 
fluctuations of securities prices generally and disruption in the 
functioning of the securities markets that could threaten fair and 
orderly markets. We intend the enhanced delivery requirements 
(temporary Rule 204T and elimination of the options market maker 
exception) imposed by the Order and the ``naked'' short selling 
antifraud rule to provide powerful disincentives to those who might 
otherwise exacerbate artificial price movements through ``naked'' short 
selling. Thus, we have determined in this environment that the 
standards under Section 12(k)(2) for extending the Order have been met. 
Accordingly, we have determined that extending the Order is in the 
public interest and necessary to maintain fair and orderly securities 
markets and for the protection of investors.
    In addition, we note that Staff of the Division of Trading and 
Markets has issued guidance regarding the Order to address current and 
anticipated technical and operational concerns resulting from the 
requirements of the Order.\3\ The guidance will continue to apply for 
the duration of the Order and the Commission hereby incorporates and 
adopts the guidance.
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    \3\ See http://www.sec.gov/divisions/marketreg/204tfaq.htm and 
http://www.sec.gov/divisions/marketreg/loanedsecuritiesfaq.htm.
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    It is therefore ordered that, pursuant to Section 12(k)(2)(C) of 
the Exchange Act, the Commission hereby incorporates and adopts the 
Division of Trading and Markets: Guidance Regarding the Commission's 
Emergency Order Concerning Rules to Protect Investors Against ``Naked'' 
Short Selling Abuses and the Division of Trading and Markets Guidance 
Regarding Sale of Loaned but Recalled Securities.
    It is further ordered that, pursuant to Section 12(k)(2)(C) of the 
Exchange Act, the Order is extended such that it will terminate at 
11:59 p.m. E.D.T. on Friday, October 17, 2008.

    By the Commission.
Florence E. Harmon,
Acting Secretary.
 [FR Doc. E8-23614 Filed 10-6-08; 8:45 am]
BILLING CODE 8011-01-P