[Federal Register Volume 74, Number 72 (Thursday, April 16, 2009)]
[Notices]
[Pages 17708-17709]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-8657]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59736; File No. SR-NYSEAmex-2009-10]


Self-Regulatory Organizations; NYSE Amex LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change Amending Rule 
975NY--Obvious Errors and Catastrophic Errors

April 8, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on April 1, 2009, NYSE Amex LLC (``NYSE Amex'' 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 prepared by the self-regulatory 
organization. NYSE Amex filed the proposed rule change as a ``non-
controversial'' proposal pursuant to Section 19(b)(3)(A) of the Act \4\ 
and Rule 19b-4(f)(6) thereunder,\5\ 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 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 amend Exchange Rule 975NY--Obvious Errors 
and Catastrophic Errors. A copy of this filing is available on the 
Exchange's Web site at http://www.nyse.com, at the Exchange's principal 
office and at the Commission's Public Reference Room.

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.

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

1. Purpose
    NYSE Amex proposes to amend Rule 975NY pertaining to the 
nullification and adjustment of options transactions. Specifically, the 
Exchange proposes to adopt a new provision which provides that in the 
interest of maintaining a fair and orderly market and for the 
protection of investors, the Chief Executive Officer of NYSE Amex 
(``CEO'') or his/her designee (collectively ``Exchange officer''),\6\ 
may, on his or her own motion or upon request, determine to review any 
transaction occurring on the Exchange that is believed to be 
erroneous.\7\ A transaction reviewed pursuant to this new provision may 
be nullified or adjusted only if it is determined by the Exchange 
officer that the transaction is erroneous as provided in Rule 
975NY(a)(1)-(5) or Commentary .04 thereof. A transaction would be 
adjusted or nullified in accordance with the provision under which it 
is deemed an erroneous transaction. The Exchange officer may be 
assisted by a Trading Official in reviewing a transaction.
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    \6\ The Exchange represents that a CEO designee will be an 
officer of the Exchange, who has also been designated as a Trading 
Official, such as the Executive Vice President of Trading Operations 
or the Vice President of Trade Operations or the Vice President of 
Options Floor Operations. Exchange officers are employees of the 
Exchange, and are not affiliated with ATP Holders or ATP Firms.
    \7\ In the event a party to a transaction requests the review of 
a transaction, an Exchange officer nonetheless would need to 
determine, on his or her own motion, whether to review the 
transaction.
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    The Exchange officer shall act pursuant to this paragraph as soon 
as possible after receiving notification of the transaction, and 
ordinarily would be expected to act on the same day as the transaction 
occurred. However, because a transaction under review may have occurred 
near the close of trading or due to unusual circumstances, the rule 
provides that the Exchange officer shall act no later than 9:30 a.m. 
(ET) on the next trading day following the date of the transaction in 
question. An ATP Holder affected by a determination to nullify or 
adjust a transaction pursuant to this new provision may appeal such 
determination in accordance with Rule 975NY(a)(6); however, a 
determination by an Exchange officer not to review a transaction, or a 
determination not to nullify or adjust a transaction for which a review 
was requested or conducted, is not appealable. NYSE Amex believes it is 
appropriate to limit review on appeal to only those situations in which 
a transaction is actually nullified or adjusted.
    This new provision is not intended to replace a party's obligation 
to request a review, within the required time periods under Rule 
975NY(a)(3), of any transaction that it believes meets the criteria for 
an obvious error. And, if a transaction is reviewed and a determination 
has been rendered pursuant to Rules 975NY(a)(1)-(5) or Commentary .04 
thereof, no additional relief may be granted under this new provision. 
Moreover, NYSE Amex does not anticipate exercising this new authority 
in every situation in which a party fails to make a timely request for 
review of a transaction pursuant to Rule 975NY(a)(3). NYSE Amex 
believes this provision will help to protect the integrity of its 
marketplace by vesting an Exchange officer with the authority to review 
a transaction that may be erroneous, notwithstanding that a party 
failed to make a timely request for a review.
    The Exchange also proposes at this time to revise Rule 
975NY(a)(3)(A) in order to clarify that the time period in which a 
Market Maker or other ATP Holder must notify the Exchange, when 
requesting relief from a possible erroneous transaction, applies to all 
transactions that are subject to adjustment or nullification, pursuant 
to Rule 975NY(a)(1)-(5).
2. Statutory Basis
    This proposed rule change is designed to allow an Exchange officer 
to review a transaction in order to provide the opportunity for 
potential relief to a party affected by an obvious error. The Exchange 
believes that for these reasons the proposed rule change is consistent 
with Section 6(b) of the Act \8\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act \9\ in particular, because it 
is 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, and to remove impediments to and perfect 
the mechanism of a free and open market and a national market

[[Page 17709]]

system. NYSE Amex notes that the Exchange officer can adjust or nullify 
a transaction under the authority granted by this new provision only if 
the transaction meets the objective criteria for an obvious error under 
NYSE Amex rules.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\ 
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 prior to 
30 days from the date on which it was filed, 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 \12\ and Rule 19b-
4(f)(6)(iii) thereunder.\13\
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    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's intent to file the proposed rule change along with a 
brief description and text of 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 
Exchange has satisfied the pre-filing requirement.
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    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.

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-NYSEAmex-2009-10 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEAmex-2009-10. 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 the filing also will be available for 
inspection and copying at the principal office of the Exchange. 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-NYSEAmex-2009-10 and should 
be submitted on or before May 7, 2009.

    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,
Deputy Secretary.
 [FR Doc. E9-8657 Filed 4-15-09; 8:45 am]
BILLING CODE 8010-01-P