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Federal Register / Vol. 72, No.

4 / Monday, January 8, 2007 / Notices 811

D. Accelerated Approval of the No. 1 to the proposal on December 27, A. Self-Regulatory Organization’s
Proposed Rule Change as Modified by 2006. The Commission is publishing Statement of the Purpose of, and
Amendments No. 3 and 4 Thereto this notice to solicit comments on the Statutory Basis for, the Proposed Rule
The Commission finds good cause to proposed rule change, as amended, from Change
approve the proposed rule change as interested persons.
1. Purpose
modified by Amendments No. 3 and 4 I. Self-Regulatory Organization’s
prior to the 30th day after the Statement of the Terms of Substance of This proposed rule change will
amendment is published for comment the Proposed Rule Change amend the definition of ‘‘Complex
in the Federal Register. Amendments Trade’’ in Chapter XII, Section 1(c) of
No. 3 and 4 makes clarifying changes to The BSE proposes to amend Chapter the BOX Rules. For Linkage purposes,
the description of the proposed rule XII, Section 1(c) of the rules of the the BOX Rules define a ‘‘Complex
change. The Commission believes that, Boston Options Exchange (‘‘BOX’’) to Trade’’ as a trade reflecting the
as a whole, Amendments No. 3 and 4 revise the definition of ‘‘Complex execution of an order in an options
strengthen the proposed rule change Trade’’ as such definition applies to series in conjunction with one or more
and do not raise any new regulatory trades through the Intermarket Linkage other orders in different series in the
issues. Therefore, the Commission finds (‘‘Linkage’’). The text of the proposed same underlying security ‘‘for the
good cause, consistent with section rule change appears below, with
equivalent number of contracts.’’ A
19(b)(2) of the Act,27 to approve the additions italicized and deletions in
Complex Trade is exempt from the
proposal, as amended, on an accelerated [brackets]:
basis. trade-through rule.3
Chapter XII. Intermarket Linkage Rules In contrast to the Linkage definition of
V. Conclusion ‘‘Complex Trade,’’ Chapter V, Section
Sec. 1 Definitions
It is therefore ordered, pursuant to 27(a) of the BOX Rules defines
Section 19(b)(2) of the Act,28 that the The following terms shall have the ‘‘complex orders’’ for other purposes on
proposed rule change (SR–Amex–2006– meaning specified in this Section 1 the Exchange. This definition includes
76), as modified by Amendments No. 1, solely for the purpose of this Chapter ‘‘Ratio Orders,’’ which do not require
2, 3, and 4 be, and it hereby is, approved XII: that there be an equivalent number of
on an accelerated basis. (a)–(b) No Change. contracts in the orders.4 Specifically,
For the Commission, by the Division of (c) ‘‘Complex Trade’’ means the the rule permits ratios that are equal to
Market Regulation, pursuant to delegated or greater than one-to-two. The
execution of an order in an options
authority.29 Exchange applies modified priority
series in conjunction with the execution
Jill M. Peterson, rules to complex orders.
of one or more related orders in
Assistant Secretary. different options series in the same According to the BSE, the proposed
[FR Doc. E7–16 Filed 1–5–07; 8:45 am] underlying security occurring at or near rule change will conform the Linkage
BILLING CODE 8011–01–P the same time for the purpose of definition of Complex Trade to BOX’s
executing a particular investment general definition of the concept. The
strategy and for an equivalent number BSE represents that the other five
SECURITIES AND EXCHANGE of contracts, provided that the number
COMMISSION options exchanges are adopting a
of contracts of the legs of a spread, similar definition, which will result in
[Release No. 34–55015; File No. SR–BSE– straddle, or combination order may uniform application of the term across
2006–55] differ by a permissible ratio [for the all options exchanges. The BSE believes
equivalent number of contracts and for that such uniformity will facilitate the
Self-Regulatory Organizations; Boston the purpose of executing a particular
Stock Exchange, Inc; Notice of Filing speedy execution of complex trades on
investment strategy]. The permissible all markets.
of a Proposed Rule Change and ratio for this purpose is any ratio that
Amendment No. 1 Thereto Relating to is equal to or greater than one-to-three 2. Statutory Basis
the Definition of Complex Trade as (.333) and less than or equal to three-
Applied to Trades Through the to-one (3.00). The basis under the Act for the
Intermarket Linkage proposed rule change is the requirement
(d)–(s) No Change. under Section 6(b)(5) of the Act 5 that
December 28, 2006. * * * * * the rules of a national securities
Pursuant to Section 19(b)(1) of the
II. Self-Regulatory Organization’s exchange be designed to promote just
Securities Exchange Act of 1934
Statement of the Purpose of, and and equitable principles of trade, to
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
Statutory Basis for, the Proposed Rule remove impediments to and perfect the
notice is hereby given that on December
13, 2006, the Boston Stock Exchange, Change mechanism of a free and open market
Inc (‘‘BSE’’ or ‘‘Exchange’’) filed with and a national market system, and, in
In its filing with the Commission, the general, to protect investors and the
the Securities and Exchange
Exchange included statements public interest. In particular, the BSE
Commission (‘‘Commission’’) the
concerning the purpose of, and basis for, believes that the proposed rule change
proposed rule change, as described in
the proposed rule change and discussed will make BOX’s Linkage Rules
Items I, II, and III below, which Items
any comments it received on the consistent with BOX’s internal market
have been substantially prepared by the
proposed rule change. The text of these rules and will facilitate the trading of
Exchange. The BSE filed Amendment
statements may be examined at the complex orders.6
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27 15 U.S.C. 78s(b)(2).
places specified in Item IV below. The
28 15 U.S.C. 78s(b)(2). Exchange has substantially prepared 3 See Box Rules, Chapter XII, Section 3(b)(vii).
29 17 CFR 200.30–3(a)(12). summaries, set forth in Sections A, B, 4 See Box Rules, Chapter V, Section 27(a)(vi).
1 15 U.S.C. 78s(b)(1). and C below, of the most significant 5 15 U.S.C. 78f(b)(5).
2 17 CFR 240.19b–4. aspects of such statements. 6 See Amendment No. 1.

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812 Federal Register / Vol. 72, No. 4 / Monday, January 8, 2007 / Notices

B. Self-Regulatory Organization’s submission, all subsequent This order approves the proposed rule
Statement on Burden on Competition amendments, all written statements change.
The BSE does not believe that the with respect to the proposed rule
II. Description of the Proposal
proposed rule change will impose any change that are filed with the
Commission, and all written The purpose of this filing is to adopt
burden on competition not necessary or rules that would allow for the allocation
appropriate in furtherance of the communications relating to the
proposed rule change between the of stocks to CBSX DPMs.
purposes of the Act. The Exchange has represented that it
Commission and any person, other than
C. Self-Regulatory Organization’s those that may be withheld from the intends to submit a proposal to modify
Statement on Comments on the public in accordance with the Chapters 50–55 of its rules, which
Proposed Rule Change Received From provisions of 5 U.S.C. 552, will be govern the trading of non-option
Members, Participants or Others available for inspection and copying in securities on the Exchange,4 in
the Commission’s Public Reference connection with the establishment of
The BSE has neither solicited nor
Room. Copies of such filing also will be CBSX (the ‘‘CBSX Trading Rules
received comments on the proposed
available for inspection and copying at Proposal’’). In addition, the Exchange
rule change.
the principal office of the Exchange. All has proposed rules to establish CBSX as
III. Date of Effectiveness of the comments received will be posted a facility of the Exchange (the ‘‘CBSX
Proposed Rule Change and Timing for without change; the Commission does Facility Proposal’’).5 If the Commission
Commission Action not edit personal identifying approves these proposals, CBSX would
Within 35 days of the date of information from submissions. You be a facility of the Exchange and would
publication of this notice in the Federal should submit only information that serve as the Exchange’s vehicle for
Register or within such longer period (i) you wish to make available publicly. All trading non-option securities. In
as the Commission may designate up to addition, the Exchange has filed for
submissions should refer to File
immediate effectiveness a proposal to
90 days of such date if it finds such Number SR–BSE–2006–55 and should
appoint CBSX DPMs (the ‘‘CBSX DPM
longer period to be appropriate and be submitted on or before January 29,
Appointment Proposal’’).6 Any
publishes its reasons for so finding or 2007.
appointments under the CBSX DPM
(ii) as to which the self-regulatory For the Commission, by the Division of Appointment Proposal and any
organization consents, the Commission Market Regulation, pursuant to delegated allocations made to such DPMs under
will: authority.7
A. By order approve such proposed this proposal would be contingent on
Jill M. Peterson, Commission approval of the CBSX
rule change; or Assistant Secretary.
B. institute proceedings to determine Trading Rules Proposal—in particular,
[FR Doc. E6–22661 Filed 1–5–07; 8:45 am] those rules governing DPM trading
whether the proposed rule change
should be disapproved. BILLING CODE 8011–01–P procedures and obligations on CBSX—
and the CBSX Facility Proposal.
IV. Solicitation of Comments Initial CBSX DPM stock allocations
Interested persons are invited to SECURITIES AND EXCHANGE would be handled pursuant to proposed
submit written data, views, and COMMISSION CBOE Rule 53.54. For the initial launch,
arguments concerning the foregoing, [Release No. 34–55025; File No. SR–CBOE– and potentially in instances where
including whether the proposed rule 2006–96] CBSX seeks to commence trading a
change, as amended, is consistent with number of new securities at one time,
the Act. Comments may be submitted by Self-Regulatory Organizations; CBSX would conduct a ‘‘draft’’ for
any of the following methods: Chicago Board Options Exchange, eligible CBSX DPMs to select available
Incorporated; Order Approving a stocks. The draft order would be
Electronic Comments Proposed Rule Change Regarding determined randomly. In connection
• Use the Commission’s Internet Allocation of Stocks to CBSX DPMs with the initial launch, the draft would
comment form http://www.sec.gov/ apply to the first 500 securities
December 29, 2006. selected.7 The remaining securities
rules/sro.shtml); or
• Send an e-mail to rule- I. Introduction slated for trading on CBSX would be
comments@sec.gov. Please include File allocated randomly by CBSX to the
On November 20, 2006, the Chicago
No. SR–BSE–2006–55 on the subject CBSX DPMs equally.
Board Options Exchange, Incorporated CBSX would utilize proposed CBOE
line. (‘‘CBOE’’ or ‘‘Exchange’’) filed with the Rule 53.54 for future stock allocations as
Paper Comments Securities and Exchange Commission well. In those cases, a draft could be
(‘‘Commission’’), pursuant to Section
• Send paper comments in triplicate
19(b)(1) of the Securities Exchange Act 4 See Securities Exchange Act Release No. 54422
to Nancy M. Morris, Secretary,
of 1934 (‘‘Act’’ or ‘‘Exchange Act’’) 1 and (September 11, 2006), 71 FR 54537 (September 15,
Securities and Exchange Commission,
Rule 19b–4 thereunder,2 a proposal 2006) (approving SR–CBOE–2004–21). See also
100 F Street, NE., Washington, DC Securities Exchange Act Release No. 54526
relating to the allocation of stocks for
20549–1090. (September 27, 2006), 71 FR 58646 (October 4,
All submissions should refer to File the CBOE Stock Exchange (‘‘CBSX’’). 2006) (approving SR–CBOE–2006–70).
Number SR–BSE–2006–55. This file The proposal was published for 5 See SR–CBOE–2006–110 (filed December 26,

number should be included on the comment in the Federal Register on 2006).

subject line if e-mail is used. To help the November 27, 2006. The Commission
3 6 See Securities Exchange Act Release No. 54831

received no comments on the proposal. (November 29, 2006), 71 FR 70814 (December 6,


Commission process and review your 2006) (notice of filing and immediate effectiveness
jlentini on PROD1PC65 with NOTICES

comments more efficiently, please use 7 17 CFR 200.30–3(a)(12).


of SR–CBOE–2006–100).
7 Telephone conversation between Angelo
only one method. The Commission will 1 15 U.S.C. 78s(b)(1).
Evangelou, Assistant General Counsel, CBOE, and
post all comments on the Commission’s 2 17 CFR 240.19b–4.
Nathan Saunders, Special Counsel, Division of
Internet Web site (http://www.sec.gov/ 3 See Securities Exchange Act Release No. 54792 Market Regulation, Commission, November 20,
rules/sro.shtml). Copies of the (November 20, 2006), 71 FR 68659. 2006.

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