

[Federal Register: October 11, 2007 (Volume 72, Number 196)]
[Notices]               
[Page 57980-57982]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11oc07-103]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56611; File No. SR-CHX-2007-19]

 
Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Relating 
to a New Book Feed Product

October 4, 2007.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on September 27, 2007, the Chicago Stock Exchange, Inc. (``CHX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II 
and III below, which Items have been substantially prepared by the CHX. 
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\ 17 CFR 240.19b-4.

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[[Page 57981]]

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Through this filing, the Exchange proposes to distribute a new Book 
Feed product and to amend its Fee Schedule to confirm that it will not 
charge a fee for the distribution of this product. The text of this 
proposed rule change is available on the Exchange's Web site at http://www.chx.com/rules/proposed_rules.htm
, at the CHX's Office of the 

Secretary, 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 CHX included statements 
concerning the purpose of and basis for the proposed rule changes and 
discussed any comments it 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 such statements.

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

1. Purpose
    Through this filing, the Exchange proposes to distribute a new Book 
Feed product and to amend its Fee Schedule to confirm that it will not 
charge a fee for the distribution of this product.\3\ This product 
currently is slated to be available on or before October 31, 2007.
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    \3\ The Exchange does not currently plan to charge a fee for the 
distribution of this data, but may choose to do so in the future. 
Any decision to charge a fee for the Book Feed data would be 
reflected in a filing submitted to the Commission as required by 
Rule 19b-4 of the Act.
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    Through the Book Feed, the Exchange would disseminate a real-time 
stream of data that includes, among other things, all visible orders 
submitted to the Exchange's Matching System, as well as any changes to 
those orders.\4\ The Book Feed would also contain information about 
trades that occur on the Exchange. This data would be available to any 
person or entity, either through a direct feed from the Exchange or 
through a company or vendor that provides the data to others.\5\ The 
Book Feed would include basic information about each order, including 
the size and price of the order; whether it was an order to buy or 
sell; its time of receipt; and the identity of the participant firm 
that submitted the order.\6\
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    \4\ Undisplayed orders and the undisplayed portions of reserve 
size orders would not be disseminated through the Book Feed; 
however, any odd lot orders (which are not expressly identified as 
``undisplayed'') would be disseminated through the Book Feed.
    \5\ Each person or entity that requests the data directly from 
the Exchange would be required to sign an appropriate agreement with 
the Exchange; if the recipient of the data (the ``vendor'') 
disseminates the data to another person or entity (the 
``subscriber''), the subscriber would be required to sign a 
subscriber agreement with the vendor. Each of these agreements would 
contain provisions substantially similar to those used by the 
securities information processors for the distribution of market 
data.
    \6\ A participant firm could choose, either on a firm-wide or 
order-by-order basis, to have its identity kept confidential in the 
order information that is distributed in the Book Feed. The Exchange 
plans to have the ability to remove a participant firm's identity on 
the data, at the firm's request, on or before October 31, 2007; 
alternatively, beginning on or about November 15, 2007, the firm 
could append a special indicator to the order confirming its choice 
to remain anonymous in the Book Feed.
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    The Exchange believes that, by making this Book Feed available, it 
would enhance market transparency and foster competition among 
markets.\7\ Other self-regulatory organizations currently distribute 
similar data feeds.\8\
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    \7\ Within the Exchange's systems, the data that would be 
disseminated as part of the Book Feed would leave the Matching 
System immediately following the best bids, offers and last sales 
that are being sent to the securities information processors 
(``SIPs''). The Exchange would not use any technology that is 
designed to make the Book Feed data available from the Matching 
System earlier than the best bids, offers and last sales are 
available to the SIPs.
    \8\ See filings relating to the New York Stock Exchange's 
OpenBook service (including Securities Exchange Act Release Nos. 
44138 (December 7, 2001), 66 FR 64895 (December 14, 2001) and 53585 
(March 31, 2006), 71 FR 17934 (April 7, 2006)); NYSE Arca's ArcaBook 
data, Securities Exchange Act Release No. 54597 (October 12, 2006), 
71 FR 62029 (October 20, 2006) (confirming that the ArcaBook data 
currently is disseminated without charge); and the Philadelphia 
Stock Exchange's data display in its new XLE system, Securities 
Exchange Act Release No. 54538 (September 28, 2006), 71 FR 59184 
(October 6, 2006).
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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).\9\ The proposed rule change is consistent 
with section 6(b)(4) of the Act in that it provides for the equitable 
allocation of reasonable dues, fees and other charges among its 
members. The proposed rule change is consistent with section 6(b)(5) of 
the Act because it would promote just and equitable principles of 
trade, remove impediments to, and perfect the mechanism of, a free and 
open market and a national market system, and, in general, protect 
investors and the public interest by allowing the Exchange distribute a 
Book Feed much like those already distributed by other markets.
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    \9\ 15 U.S.C. 78(f)(b).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    CHX 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

    The Exchange neither solicited nor received comments on the 
proposal.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing rule does not (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 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, provided that the Exchange has given the 
Commission written notice of its intent to file 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,\10\ the proposed rule change has become effective pursuant 
to section 19(b)(3)(A) of the Act \11\ and Rule 19b-4(f)(6) 
thereunder.\12\
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    \10\ The Exchange has fulfilled this requirement.
    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6).
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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 rule-comments@sec.gov. Please include 

File Number SR-CHX-2007-19 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission,

[[Page 57982]]

100 F Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-CHX-2007-19. 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 such filing also will be available for 
inspection and copying at the principal office of the CHX. 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-CHX-2007-19 and should be 
submitted on or before November 1, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
 [FR Doc. E7-20024 Filed 10-10-07; 8:45 am]

BILLING CODE 8011-01-P
