68 FR 160 pgs. 49828-49829 - Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the Chicago Stock Exchange, Inc. Relating to Member Entry of Trade Information for Reporting and Dissemination
Type: NOTICEVolume: 68Number: 160Pages: 49828 - 49829
Docket number: [Release No. 34-48327; File No. SR-CHX-2003-26]
FR document: [FR Doc. 03-21130 Filed 8-18-03; 8:45 am]
Agency: Securities and Exchange Commission
Official PDF Version: PDF Version
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-48327; File No. SR-CHX-2003-26]
Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the Chicago Stock Exchange, Inc. Relating to Member Entry of Trade Information for Reporting and Dissemination
August 12, 2003.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 ("Act"),1and Rule 19b-4 thereunder,2notice is hereby given that on August 7, 2003, the Chicago Stock Exchange, Inc. ("CHX") filed with the Securities and Exchange Commission the proposed rule change as described in Items I, II and III below, which the CHX has prepared. The CHX filed the proposal pursuant to Section 19(b)(3)(A) of the Act3and Rule 19b-4(f)(5) thereunder,4which 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.
Footnotes:
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b-4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b-4(f)(5).
I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The CHX proposes to amend CHX Article XXI, Rule 3, which governs delivery of trade tickets for reporting and dissemination. The proposed rule change would modify the rule to give members the alternative of entering trade information directly, rather than having to deliver the trade tickets to CHX personnel. The text of the proposed rule change is available at the CHX and at the Commission.
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 CHX included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it had received regarding the proposal. The text of these statements may be examined at the places specified in Item IV below. The CHX has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of those statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. Purpose
CHX Article XXI, Rule 3 governs delivery of trade tickets for reporting and dissemination. The rule currently permits trades executed on the CHX floor to be reported in two ways: (1) Executions initiated through the CHX's MAX® system are automatically reported to the CHX for dissemination; and (2) other executions that occur on the trading floor must be written on a ticket and delivered to CHX personnel for entry into the CHX's systems. The proposed rule change would amend CHX Article XXI, Rule 3 to give members the alternative of entering trade information themselves, using technological enhancements that the CHX has approved, rather than delivering the trade tickets to CHX personnel for entry.
The CHX believes that the proposed rule change would modernize the rule by enabling a CHX member to report a transaction by inputting the trade information into a CHX-approved system. As an initial matter, this proposal would allow CHX floor brokers to enter trades themselves via the Brokerplex TM stations that the CHX has provided to them.5In the future, the CHX may develop additional technological enhancements that permit other CHX floor members to report transactions in a more automated manner.6In short, the proposed rule change makes it clear that CHX members may make use of this new technology to enter information about a transaction directly for dissemination to the market.
Footnotes:
5 The Brokerplex system is a front-end system that allows a floor broker to keep an automated record of his or her orders. It is not an order execution system, although it can send orders to the CHX's MAX system for execution in accordance with applicable order execution rules.
6 The CHX states that the development of these additional technologies is not currently a significant systems priority.
2. Statutory Basis
The CHX believes the proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b).7The CHX believes the proposal is consistent with Section 6(b)(5) of the Act8in that it is designed 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.
Footnotes:
7 15 U.S.C. 78(f)(b).
8 15 U.S.C. 78f(b)(5).
B. Self-Regulatory Organization's Statement of Burden on Competition
The CHX does not believe that the proposed rule change will impose any inappropriate burden on competition.
C. Self-Regulatory Organization's Statement on Comments Regarding the Proposed Rule Change Received From Members, Participants or Others
The CHX neither solicited nor received written comments with respect to this proposal.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
The proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act9and Rule 19b-4(f)(5) thereunder10because it constitutes a change in an existing order-entry or trading system of a self-regulatory organization that (i) does not significantly affect the protection of investors or the public interest; (ii) does not impose any significant burden on competition; and (iii) does not have the effect of limiting access to or availability of the system. At any time within 60 days after 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.
Footnotes:
9 15 U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b-4(f)(5).
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposal is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 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. Copies of such filing will also be available for inspection and copying at the principal office of the CHX. All submissions should refer to File No. SR-CHX-2003-26 and should be submitted by September 9, 2003.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.11
Footnotes:
11 17 CFR 200.30-3(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-21130 Filed 8-18-03; 8:45 am]
BILLING CODE 8010-01-P