
[Federal Register: April 1, 2008 (Volume 73, Number 63)]
[Notices]               
[Page 17386-17387]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01ap08-85]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57557; File No. SR-ISE-2008-25]

 
Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing of Proposed Rule Change, and Amendment No. 1 
Thereto, Relating to the Rescission of the ``No MPM'' Order Type

March 26, 2008.
    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 March 5, 2008, the International Securities Exchange, LLC 
(``Exchange'' or ``ISE'') 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 Exchange. On March 17, 2008, the Exchange filed 
Amendment No. 1 to the proposed rule change. The Commission is 
publishing this notice to solicit comments on the proposed rule change, 
as amended, 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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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The ISE proposes to amend its rules to rescind the ``No MPM'' order 
type. The text of the proposed rule change is below. Proposed new 
language is italicized; proposed deletions are enclosed in brackets.
* * * * *

Rule 2104. Types of Orders

    (a)-(g) No change.
    [(h) No MPM. Market or limit orders that should not be executed 
against orders residing in the Midpoint Match. (See Rule 2129)]
    [(i)](h) No further change.
    [(j)](i) No further change.
    [(k)](j) No further change.
    [(l)](k) No further change.
    [(m)](l) No further change.
    [(n)](m) No further change.
    [(o)](n) No further change.
* * * * *

2106. Opening Process

    (a) No change.
    (1) All order types other than Stop/Stop Limit, [No MPM,] Post 
Only, FOK and IOC may participate in the opening transaction. Reserve 
orders may participate to the full extent of their size. Discretionary 
orders may participate at their most aggressive prices. Pegged orders 
will have limit prices based upon the NBBO that is required for the 
opening transaction to occur.
    (2)-(3) No change.
    (b)-(f) No change.
* * * * *

2107. Priority and Execution of Orders

    (a) No change.
    (b) Order Execution. All orders are handled automatically by the 
ISE Stock Exchange. All orders are available for price improvement at 
the midpoint of the NBBO if contra-side interest exists in Midpoint 
Match[, unless marked ``No MPM'']. Except as specified below in 
paragraph (c), orders will not be executed at prices that are inferior 
to

[[Page 17387]]

Protected Quotations available at other Trading Centers.
* * * * *

Rule 2129. MidPoint Match

    The MidPoint Match (``MPM'') is a process by which Members [can 
seek] may receive an execution price that is at the midpoint of the 
NBBO.
    (a)-(g) No change.
* * * * *

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 Exchange 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 these 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 aspects of such 
statements.

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

1. Purpose
    The best bids and offers on the ISE Stock Exchange are displayed to 
the marketplace on a continuous basis. Additionally, the ISE offers 
incoming orders an opportunity to receive price improvement at the 
midpoint of the National Best Bid or Offer (``NBBO'') through its 
MidPoint Match (``MPM'') process. Specifically, before executing 
incoming orders against the ISE's displayed bid or offer, the System 
checks MPM to see if there is contra-side interest that can provide 
price improvement. However, under ISE's current rules, Equity 
Electronic Access Members may specify on orders that they do not want 
the orders to execute against MPM interest, thereby denying such orders 
the opportunity for price improvement.
    The Exchange proposes to eliminate the ``No MPM'' order qualifier 
so that all inbound orders will be exposed to MPM interest and be 
afforded price improvement, when available, before executing against 
the ISE's displayed quotations. The Exchange believes that elimination 
of the ``No MPM'' order qualifier is appropriate to assure that 
customers are provided the opportunity to interact with this additional 
source of liquidity and to receive price improvement whenever possible.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder. Specifically, the 
Exchange believes the proposed rule change is consistent with section 
6(b)(5)\3\ of the Act, requiring that the rules of an exchange be 
designed to promote just and equitable principles of trade, serve to 
remove impediments to and perfect the mechanism for a free and open 
market and a national market system, and, in general, to protect 
investors and the public interest.
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    \3\15 U.S.C. 78(f)(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change does not 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 has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    A. By order approve such proposed rule change, or
    B. institute proceedings to determine whether the proposed rule 
change should be disapproved.

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 No. SR-ISE-2008-25 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 File Number SR-ISE-2008-25. 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 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-ISE-2008-25 and should be 
submitted on or before April 22, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\4\
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    \4\17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-6609 Filed 3-31-08; 8:45 am]

BILLING CODE 8011-01-P
