

[Federal Register: October 12, 2007 (Volume 72, Number 197)]
[Notices]               
[Page 58133-58134]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12oc07-102]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56596; File No. 4-429]

 
Joint Industry Plan; Notice of Filing of Joint Amendment No. 24 
to the Plan for the Purpose of Creating and Operating an Intermarket 
Option Linkage Regarding Elimination of the Class Gate

October 2, 2007.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 608 of Regulation NMS thereunder,\2\ notice is 
hereby given that on September 14, 2007, September 19, 2007, August 29, 
2007, August 29, 2007, August 30, 2007, and September 26, 2007, 
American Stock Exchange, LLC (``Amex''), Boston Stock Exchange, Inc. 
(``BSE''), Chicago Board Options Exchange, Incorporated (``CBOE''), 
International Securities Exchange, LLC (``ISE''), NYSE Arca, Inc. 
(``NYSE Arca''), and Philadelphia Stock Exchange, Inc. (``Phlx'') 
(collectively, the ``Participants''), respectively, submitted to the 
Securities and Exchange Commission (``Commission'') Amendment No. 24 to 
the Plan for the Purpose of Creating and Operating an Intermarket 
Option Linkage (``Linkage

[[Page 58134]]

Plan'').\3\ The amendment proposes to eliminate the ``Class Gate'' 
restriction on Principal Order access through the Linkage. The 
Commission is publishing this notice to solicit comments from 
interested persons on the proposed Joint Amendment to the Linkage Plan.
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ On July 28, 2000, the Commission approved a national market 
system plan for the purpose of creating and operating an intermarket 
options market linkage (``Linkage'') proposed by Amex, CBOE, and 
ISE. See Securities Exchange Act Release No. 43086 (July 28, 2000), 
65 FR 48023 (August 4, 2000). Subsequently, Phlx, Pacific Exchange, 
Inc. (n/k/a NYSE Arca), and BSE joined the Linkage Plan. See 
Securities Exchange Act Release Nos. 43573 (November 16, 2000), 65 
FR 70851 (November 28, 2000); 43574 (November 16, 2000), 65 FR 70850 
(November 28, 2000); and 49198 (February 5, 2004), 69 FR 7029 
(February 12, 2004).
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I. Description of the Proposed Amendment

    The Participants are proposing to modify Section 7(a)(ii)(C) of the 
Linkage Plan so as to eliminate the ``Class Gate'' restriction on 
Principal Order access through the Linkage. Currently, Section 
7(a)(ii)(C) of the Linkage Plan provides that, once a Participant 
automatically executes a Principal Order in a series of an Eligible 
Option Class, it may reject any other Principal Orders sent in the same 
Eligible Option Class by the same Participant for 15 seconds after the 
initial execution unless there is a price change in the receiving 
Participant's disseminated offer (bid) in the series in which there was 
the initial execution and such price continues to be the NBBO. After 
the 15 second period, and until the sooner of one minute after the 
initial execution or a change in its disseminated offer (bid), the 
Section provides that the Participant that provided the initial 
execution is not obligated to execute any Principal Orders received 
from the same Participant in the same Eligible Option Class in its 
automatic execution system.
    The Participants represent that a change to the ``Class Gate'' 
provision is appropriate because, at the time of the creation of the 
Linkage, various markets had restrictions on non-customer access to the 
automatic execution systems. Since then, all of the exchanges have 
removed those restrictions and allow access for orders on behalf of 
non-member market makers to their trading platforms, thus eliminating 
the need for the ``Class Gate.''

II. Implementation of the Plan Amendment

    The proposed amendment to the Linkage Plan will be effective upon 
approval by the Commission pursuant to Rule 608 of Regulation NMS under 
the Act.\4\
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    \4\ 17 CFR 242.608.
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III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed 
amendment to the Linkage Plan 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 4-429 on the subject line.

Paper Comments

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

All submissions should refer to Joint Amendment No. 24 to File Number 
4-429. 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 Amex, BSE, CBOE, 
ISE, NYSE Arca and Phlx. 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 Joint 
Amendment No. 24 to File No. 4-429 and should be submitted on or before 
November 2, 2007.
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    \5\ 17 CFR 200.30-3(a)(29).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\
Nancy M. Morris,
Secretary.
[FR Doc. E7-20116 Filed 10-11-07; 8:45 am]

BILLING CODE 8011-01-P
