

[Federal Register: August 1, 2007 (Volume 72, Number 147)]
[Notices]               
[Page 42139]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01au07-117]                         

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[[Page 42139]]

SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-451, OMB Control No. 3235-0509]

 
Submission for OMB Review; Comment Request

Upon written request, copies available from: Securities and Exchange 
Commission, Office of Investor Education and Assistance, Washington, DC 
20549-0213.

Extension: Rule 301 and Forms ATS and ATS-R.

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') has submitted to the Office of Management 
and Budget a request for extension of the previously approved 
collection of information discussed below.
    Regulation ATS (17 CFR 242.300 et seq.) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78a et seq.) provides a regulatory structure 
that directly addresses issues related to alternative trading systems' 
role in the marketplace. Regulation ATS allows alternative trading 
systems to choose between two regulatory structures. Alternative 
trading systems have the choice between registering as broker-dealers 
and complying with Regulation ATS or registering as national securities 
exchanges. Regulation ATS provides the regulatory framework for those 
alternative trading systems that choose to be regulated as broker-
dealers. Rule 301 of Regulation ATS contains certain notice and 
reporting requirements, as well as additional obligations that only 
apply to alternative trading systems with significant volume. Rule 301 
describes the conditions with which a registered broker-dealer 
operating an alternative trading system must comply. The Rule requires 
all alternative trading systems that wish to comply with Regulation ATS 
to file an initial operation report on Form ATS. The initial operation 
report requires information regarding operation of the system including 
the method of operation, access criteria and the types of securities 
traded. Alternative trading systems are also required to supply updates 
on Form ATS to the Commission, describing material changes to the 
system, and quarterly transaction reports on Form ATS-R. Alternative 
trading systems are also required to file cessation of operations 
reports on Form ATS.
    Alternative trading systems with significant volume are required to 
comply with requirements for fair access and systems capacity, 
integrity and security. Under Rule 301, such alternative trading 
systems are required to establish standards for granting access to 
trading on its system. In addition, upon a decision to deny or limit an 
investor's access to the system, an alternative trading system is 
required to provide notice to the investor of the denial or limitation 
and their right to an appeal to the Commission. Regulation ATS requires 
alternative trading systems to preserve any records made in the process 
of complying with the systems' capacity, integrity and security 
requirements. In addition, such alternative trading systems are 
required to notify Commission staff of material systems outages and 
significant systems changes.
    The Commission uses the information provided pursuant to the Rule 
to monitor the growth and development of alternative trading systems to 
confirm that investors effecting trades through the systems are 
adequately protected, and that the systems do not impede the 
maintenance of fair and orderly securities markets or otherwise operate 
in a manner that is inconsistent with the federal securities laws. In 
particular, the information collected and reported to the Commission by 
alternative trading systems enables the Commission to evaluate the 
operation of alternative trading systems with regard to national market 
system goals, and monitor the competitive effects of these systems to 
ascertain whether the regulatory framework remains appropriate to the 
operation of such systems. Without the information provided on Forms 
ATS and ATS-R, the Commission would not have readily available 
information on a regular basis in a format that will allow it to 
determine whether such systems have adequate safeguards.
    Respondents consist of alternative trading systems that choose to 
register as broker-dealers and comply with the requirements of 
Regulation ATS. The Commission estimates that there are currently 
approximately 65 respondents.
    An estimated 65 respondents will file an average total of 465 
responses per year, which corresponds to an estimated annual response 
burden of 1,982.5 hours. At an average cost per burden hour of 
approximately $95.57, the resultant total related cost of compliance 
for these respondents is $189,458.15 per year (1,982.5 burden hours 
multiplied by $95.57 per hour; a slight discrepancy is due to 
arithmetic rounding).
    Compliance with Rule 301 is mandatory. The information required by 
the Rule 301 is available only to the examination of the Commission 
staff, state securities authorities and the SROs. Subject to the 
provisions of the Freedom of Information Act, 5 U.S.C. 522, and the 
Commission's rules thereunder (17 CFR 200.80(b)(4)(iii)), the 
Commission does not generally publish or make available information 
contained in any reports, summaries, analyses, letters, or memoranda 
arising out of, in anticipation of, or in connection with an 
examination or inspection of the books and records of any person or any 
other investigation.
    Regulation ATS requires alternative trading systems to preserve any 
records, for at least three years, made in the process of complying 
with the systems capacity, integrity and security requirements.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid control number.
    Comments should be directed to (i) Desk Officer for the Securities 
and Exchange Commission, Office of Information and Regulatory Affairs, 
Office of Management and Budget, Room 10102, New Executive Office 
Building, Washington, DC 20503 or by sending an e-mail to: 
David_Rostker@omb.eop.gov; and (ii) R. Corey Booth, Director/Chief 

Information Officer, Securities and Exchange Commission, c/o Shirley 
Martinson, 6432 General Green Way, Alexandria, VA 22312 or send an e-
mail to: PRA_Mailbox@sec.gov. Comments must be submitted within 30 
days of this notice.

    Dated: July 23, 2007.
Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-14845 Filed 7-31-07; 8:45 am]

BILLING CODE 8010-01-P
