[Federal Register Volume 76, Number 126 (Thursday, June 30, 2011)]
[Notices]
[Pages 38446-38447]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-16448]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64746; File No. SR-NYSEAmex-2011-45]


Self-Regulatory Organizations; NYSE Amex LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change to Extend the 
Operation of the Pilot Program That Allows Nasdaq Stock Market 
Securities To Be Traded on the Exchange Pursuant to a Grant of Unlisted 
Trading Privileges

June 24, 2011.
    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 June 21, 2011, NYSE Amex LLC (the ``Exchange'' or ``NYSE 
Amex'') 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 Exchange. 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. 78a.
    \2\ 17 CFR 240.19b-4.
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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 NYSE Amex Equities Rule 500 to 
extend the operation of the pilot program that allows Nasdaq Stock 
Market (``Nasdaq'') securities to be traded on the Exchange pursuant to 
a grant of unlisted trading privileges. The pilot is currently 
scheduled to expire on August 1, 2011; the Exchange proposes to extend 
it until the earlier of Securities and Exchange Commission 
(``Commission'') approval to make such pilot permanent or January 31, 
2012. 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.

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

1. Purpose
    NYSE Amex Equities Rules 500-525, as a pilot program, govern the 
trading of any Nasdaq-listed security on the Exchange pursuant to 
unlisted trading privileges (``UTP Pilot Program'').\3\ The Exchange 
hereby seeks to extend the operation of the UTP Pilot Program, 
currently scheduled to expire on August 1, 2011, until the earlier of 
Commission approval to make such pilot permanent or January 31, 2012.
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    \3\ See Securities Exchange Act Release No. 62479 (July 9, 
2010), 75 FR 41264 (July 15, 2010) (SR-NYSEAmex-2010-31). See also 
Securities Exchange Act Release No. 62857 (September 7, 2010), 75 FR 
55837 (September 14, 2010) (SR-NYSEAmex-2010-89) and 63601 (December 
22, 2010), 75 FR 82117 (December 29, 2010) (SR-NYSEAmex-2010-124).
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    The UTP Pilot Program includes any security listed on Nasdaq that 
(i) is designated as an ``eligible security'' under the Joint Self-
Regulatory Organization Plan Governing the Collection, Consolidation 
and Dissemination of Quotation and Transaction Information for Nasdaq-
Listed Securities Traded on Exchanges on an Unlisted Trading Privilege 
Basis, as amended (``UTP Plan''),\4\ and (ii) has been admitted to 
dealings on the Exchange pursuant to a grant of unlisted trading 
privileges in accordance with Section 12(f) of the Securities Exchange 
Act of 1934, as amended (the ``Act''),\5\ (collectively, ``Nasdaq 
Securities'').\6\
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    \4\ See Securities Exchange Act Release No. 58863 (October 27, 
2008), 73 FR 65417 (November 3, 2008). The Exchange's predecessor, 
the American Stock Exchange LLC, joined the UTP Plan in 2001. See 
Securities Exchange Act Release No. 55647 (April 19, 2007), 72 FR 
20891 (April 27, 2007) (S7-24-89). In March 2009, the Exchange 
changed its name to NYSE Amex LLC. See Securities Exchange Act 
Release No. 59575 (March 13, 2009), 74 FR 11803 (March 19, 2009) 
(SR-NYSEALTR-2009-24).
    \5\ 15 U.S.C. 78l.
    \6\ ``Nasdaq Securities'' is included within the definition of 
``security'' as that term is used in the NYSE Amex Equities Rules. 
See NYSE Amex Equities Rule 3. In accordance with this definition, 
Nasdaq Securities are admitted to dealings on the Exchange on an 
``issued,'' ``when issued,'' or ``when distributed'' basis. See NYSE 
Amex Equities Rule 501.
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    The Exchange notes that its New Market Model Pilot (``NMM Pilot''), 
which, among other things, eliminated the function of specialists on 
the Exchange and created a new category of market participant, the 
Designated Market Maker (``DMM''),\7\ is also scheduled to end on 
August 1, 2011.\8\ The timing of the operation of the UTP Pilot Program 
was designed to correspond to that of the NMM Pilot. In approving the 
UTP Pilot Program, the Commission acknowledged that the rules relating 
to DMM benefits and duties in trading Nasdaq Securities on the Exchange 
pursuant to the UTP Pilot Program are consistent with the Act \9\ and 
noted the similarity to the NMM Pilot, particularly with respect to DMM 
obligations and benefits.\10\ Furthermore, the UTP Pilot Program rules 
pertaining to the assignment of securities to DMMs are substantially 
similar to the rules implemented through the NMM Pilot.\11\ The 
Exchange has similarly filed to extend the operation of the NMM Pilot 
until the earlier of Commission approval to make the NMM Pilot 
permanent or January 31, 2012.\12\
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    \7\ See NYSE Amex Equities Rule 103.
    \8\ See Securities Exchange Act Release No. 60758 (October 1, 
2009), 74 FR 51639 (October 7, 2009) (SR-NYSEAmex-2009-65). See also 
Securities Exchange Act Release Nos. 61030 (November 19, 2009), 74 
FR 62365 (November 27, 2009) (SR-NYSEAmex-2009-83); 61725 (March 17, 
2010), 75 FR 14223 (March 24, 2010) (SR-NYSEAmex-2010-28); 62820 
(September 1, 2010), 75 FR 54935 (September 9, 2010) (SR-NYSEAmex-
2010-86); and 63615 (December 29, 2010), 76 FR 611 (January 5, 2011) 
(SR-NYSEAmex-2010-123).
    \9\ 15 U.S.C. 78.
    \10\ See supra note 1, at 41271.
    \11\ Id.
    \12\ See SR-NYSEAmex-2010-122.
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    Extension of the UTP Pilot Program in tandem with the NMM Pilot, 
both from August 1, 2011 until the earlier of Commission approval to 
make such pilots permanent or January 31, 2012,

[[Page 38447]]

will provide for the uninterrupted trading of Nasdaq Securities on the 
Exchange on a UTP basis and thus continue to encourage the additional 
utilization of, and interaction with, the NYSE Amex Equities market, 
and provide market participants with improved price discovery, 
increased liquidity, more competitive quotes and greater price 
improvement for Nasdaq Securities.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange. In particular, 
the Exchange believes that its proposal is consistent with (i) Section 
6(b) of the Act,\13\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\14\ in particular, in that it is designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade, 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; (ii) 
Section 11A(a)(1) of the Act,\15\ in that it seeks to ensure the 
economically efficient execution of securities transactions and fair 
competition among brokers and dealers and among exchange markets; and 
(iii) Section 12(f) of the Act,\16\ which governs the trading of 
securities pursuant to UTP consistent with the maintenance of fair and 
orderly markets, the protection of investors and the public interest, 
and the impact of extending the existing markets for such securities. 
Under the UTP Pilot Program Nasdaq Securities trade on the Exchange 
pursuant to rules governing the trading of Exchange-Listed securities 
that previously have been approved by the Commission. NYSE Amex made 
certain minor modifications to the operation of these rules, and added 
certain new rules, to accommodate the trading of Nasdaq Securities on a 
UTP basis; the Commission also approved all of these modifications and 
additions.
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    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 15 U.S.C. 78k-1(a)(1).
    \16\ 15 U.S.C. 78l(f).
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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 \17\ and Rule 19b-4(f)(6) thereunder.\18\ 
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 and Rule 19b-
4(f)(6)(iii) thereunder.\19\
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    \17\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \18\ 17 CFR 240.19b-4(f)(6).
    \19\ 17 CFR 240.19b-4(f)(6)(iii). Rule 19b-4(f)(6)(iii) requires 
that a self-regulatory organization submit to the Commission written 
notice of its 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 this requirement.
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend 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-2011-45 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-2011-45. 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 Web site 
viewing and printing 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-2011-45 and should be submitted on or before July 21, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\20\
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    \20\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-16448 Filed 6-29-11; 8:45 am]
BILLING CODE 8011-01-P