Tap any paragraph to write a margin note. Your notes collect in the Desk below the text and file under cases with @. The side-by-side margin rail opens on a larger screen.

§
Marginalia
Code · REGISTER · 2005-11-29 · National Park Service, Interior · Notices

Notices. Notice of extension of comment period

41,905 words·~190 min read·/register/2005/11/29/05-23428

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

BILLING CODE 4312-52-M DEPARTMENT OF THE INTERIOR National Park Service Notice of Extension of Comment Period for Draft National Park Service Management Policies AGENCY: National Park Service, Interior. ACTION: Notice of extension of comment period. SUMMARY: The National Park Service
(NPS)is proposing to update the policies that guide the management of the National Park System. Original notice of availability of the draft updated “Management Policies” was published in the **Federal Register** on October 19, 2005 [70 FR 60852, October 19, 2005]. That notice stated that comments would be accepted through January 19, 2006. This notice extends the comment period an additional 30 days, through February 18, 2006. DATES: Written comments will be accepted until February 18, 2006. ADDRESSES: The draft “Management Policies” document is available on the Internet at *http://parkplanning.nps.gov/waso* . Hard copies may be reviewed in the Department of the Interior library (at the C Street entrance of the Main Interior Building, Washington, DC); at NPS regional offices in Philadelphia, PA; Oakland, CA; Washington, DC; Atlanta, GA; Denver, CO; Omaha, NE; and Anchorage, AK; and at most units of the National Park System around the country. A limited number of single hard copies of the draft may be obtained by calling 202-208-7456. Comments can be submitted in the following ways: 1. Via the Web page at *http://parkplanning.nps.gov/waso* . This is the preferred way. 2. Via e-mail to *waso_policy@nps.gov* . Or, 3. Via surface mail to Bernard Fagan, National Park Service, Office of Policy, Room 7252, Main Interior Building, 1849 C Street, NW., Washington, DC 20240. FOR FURTHER INFORMATION CONTACT: Bernard Fagan at
(202)208-7456, or via e-mail at *waso_policy@nps.gov.* SUPPLEMENTARY INFORMATION: The policies that guide the management of the National Park System are compiled in a book called “Management Policies,” last published in 2001. Park superintendents, planners, and other NPS employees use “Management Policies” as a reference source when making decisions that will affect units of the National Park System. The NPS has completed a comprehensive revision of the book and is now providing an additional 30 days for public review and comment on the draft. All those who are concerned about the future of the National Park System are urged to read the draft in its entirety and offer ideas on how it can be improved. All comments will be reviewed and appropriate suggestions will be incorporated into the revised final version of “Management Policies.” The final document will be available for public review via the Internet and in printed form. A notice of availability of the final document, and an explanation of how comments were addressed, will appear in the **Federal Register** . Dated: November 9, 2005. Loran G. Fraser, Chief, Office of Policy, National Park Service. [FR Doc. E5-6616 Filed 11-28-05; 8:45 am] BILLING CODE 4310-52-P INTERNATIONAL TRADE COMMISSION [Investigation Nos. 751-TA-28-29] Certain Frozen Warmwater Shrimp and Prawns From India and Thailand Determinations On the basis of the record 1 developed in the subject investigations, the United States International Trade Commission (Commission) determines, pursuant to section 751(b) of the Tariff Act of 1930 (19 U.S.C. 1675d(b)) (the Act), that revocation of the antidumping duty orders covering certain frozen warmwater shrimp and prawns from India and Thailand would be likely to lead to continuation or recurrence of material injury to an industry in the United States. Certain frozen warmwater shrimp and prawns from India and Thailand are provided for in subheadings 0306.13.00 and 1605.20.10 of the Harmonized Tariff Schedule of the United States. 1 The record is defined in sec. 207.2(f) of the Commission's Rules of Practice and Procedure (19 CFR 207.2(f)). Background On December 17, 2004, the Department of Commerce determined that imports of certain frozen and canned warmwater shrimp and prawns from India and Thailand are being sold in the United States at less than fair value
(LTFV)within the meaning of section 731 of the Act (19 U.S.C. 1673) (69 FR 76916, 76918, December 23, 2004); and on January 6, 2005 the Commission determined, pursuant to section 735(b)(1) of the Act (19 U.S.C. 1673d(b)(1)), that an industry in the United States was materially injured by reason of imports of such LTFV merchandise. Accordingly, Commerce ordered that antidumping duties be imposed on such imports (70 FR 5143, February 1, 2005). On January 6, 2005, when the Commission conducted its vote in the original investigations, it stated that it was concerned about the possible impact of the December 26, 2004, tsunami on the shrimp industries of India and Thailand. The tsunami occurred prior to the closing of the record in the original investigations on December 27, 2004. At the time the record closed, however, factual information as to any impact of the tsunami on the ability of producers in India or Thailand to produce and export shrimp was not available. On February 8, 2005, the Commission published a **Federal Register** notice (70 FR 6728) inviting comments from the public on whether changed circumstances exist sufficient to warrant the institution of changed circumstances reviews of the Commission's affirmative determinations concerning certain frozen warmwater shrimp and prawns from India and Thailand. The Commission instituted the subject investigations (investigation Nos. 751-TA-28-29), effective May 5, 2005, after having reviewed the comments it received in response to that request, and having determined that it had received information which showed changed circumstances sufficient to warrant instituting review investigations and that there was good cause for instituting such review investigations within two years after publication of the orders. Notice of the scheduling of the Commission's investigations and of a public hearing to be held in connection therewith was given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in the **Federal Register** of May 5, 2005 (70 FR 23884). The hearing was held in Washington, DC, on September 14, 2005, and all persons who requested the opportunity were permitted to appear in person or by counsel. The Commission transmitted its determinations in these investigations to the Secretary of Commerce on November 21, 2005. The views of the Commission are contained in USITC Publication 3813 (November 2005), entitled *Certain Frozen Warmwater Shrimp and Prawns from India and Thailand: Investigation Nos. 751-TA-28-29.* Issued: November 21, 2005. By order of the Commission. Marilyn R. Abbott, Secretary to the Commission. [FR Doc. E5-6593 Filed 11-28-05; 8:45 am] BILLING CODE 7020-02-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Application Pursuant to Section 1301.33(a) of Title 21 of the Code of Federal Regulations (CFR), this is notice that on March 3, 2005, American Radiolabeled Chemicals, Inc., 101 Arc Drive, St. Louis, Missouri 63146, made application by renewal to the Drug Enforcement Administration
(DEA)for registration as a bulk manufacturer of the basic classes of controlled substances listed in Schedules I and II: Drug Schedule Gamma hydroxybutyric acid (2010). I Dimethyltryptamine
(7435)I Dihydromorphine
(9145)I Amphetamine
(1100)II Methamphetamine
(1105)II Lysergic acid diethylamide (7315). II Phencyclidine
(7471)II Phenylacetone
(8501)II Cocaine
(9041)II Codeine
(9050)II Oxycodone
(9143)II Hydromorphone
(9150)II Benzoylecgonine
(9180)II Ecgonine
(9180)II Meperidine
(9230)II Metazocine
(9240)II Morphine
(9300)II Thebaine
(9333)II Oxymorphone
(9652)II The company plans to manufacture in bulk, small quantities of the listed controlled substances as radiolabeled compounds. Any other such applicant and any person who is presently registered with DEA to manufacture such a substance may file comments or objections to the issuance of the proposed registration pursuant to 21 CFR 1301.33(a). Any such written comments or objections being sent via regular mail may be addressed, in quintuplicate, to the Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA Federal Register Representative, Liaison and Policy Section (ODL); or any being sent via express mail should be sent to DEA Headquarters, Attention: DEA Federal Register Representative/ODL, 2401 Jefferson Davis Highway, Alexandria, Virginia 22301; and must be filed no later than January 30, 2006. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6609 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Application Pursuant to section 1301.33(a) of Title 21 of the Code of Federal Regulations (CFR), this is notice that on May 6, 2005, Chemic Laboratories, Inc., 480 Neponset Street, Building 7C, Canton, Massachusetts 02021, made application by renewal to the Drug Enforcement Administration
(DEA)to be registered as a bulk manufacturer of Cocaine (9041), a basic class of controlled substance listed in Schedule II. The company plans to manufacture small quantities of a cocaine derivative for distribution to its customers for the purpose of research. Any other such applicant and any person who is presently registered with DEA to manufacture such a substance may file comments or objections to the issuance of the proposed registration pursuant to 21 CFR 1301.33(a). Any such written comments or objections being sent via regular mail may be addressed, in quintuplicate, to the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA Federal Register Representative, Liaison and Policy Section (ODL); or any being sent via express mail should be sent to DEA Headquarters, Attention: DEA Federal Register Representative/ODL, 2401 Jefferson Davis Highway, Alexandria, Virginia 22301; and must be filed no later than January 30, 2006. Dated: November 18, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6602 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Application Pursuant to Section 1301.33(a) of Title 21 of the Code of Federal Regulations (CFR), this is notice that on April 18, 2005, Dade Behring Inc., 100 GBE Drive, MS514, Post Office Box 6101, Attention: RA/QS, Newark, Delaware 19714-6101, made application by renewal to the Drug Enforcement Administration
(DEA)to be registered as a bulk manufacturer of the basic classes of controlled substances listed in Schedules I and II: Drug Schedule Tetrahydrocannabionols
(7370)I Benzoylecgonine
(9180)II Morphine
(9300)II The company plans to produce the listed controlled substances in bulk to be used in the manufacture of reagents and drug calibrator/controls for DEA exempt products. Any other such applicant and any person who is presently registered with DEA to manufacture such a substance may file comments or objections to the issuance of the proposed registration pursuant to 21 CFR 1301.33(a). Any such written comments or objections being sent via regular mail may be addressed, in quintuplicate, to the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA Federal Register Representative, Liaison and Policy Section (ODL); or any being sent via express mail should be sent to DEA Headquarters, Attention: DEA Federal Register Representative/ODL, 2401 Jefferson Davis Highway, Alexandria, Virginia 22301; and must be filed no later than January 30, 2006. Dated: November 18, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6603 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Application Pursuant to Section 1301.33(a) of Title 21 of the Code of Federal Regulations (CFR), this is notice that on May 13, 2005, Dade Behring, Inc., Regulatory Affairs, Quality Systems, 20400 Mariani Avenue, Cupertino, California 95014, made application by renewal to the Drug Enforcement Administration
(DEA)for registration as a bulk manufacturer of the basic classes of controlled substances listed in Schedule I and II: Drug Schedule Tetrahydrocannabionols
(7370)I Benzoylecgonine
(9180)II Morphine
(9300)II The company plans to produce the listed controlled substances in bulk to be used in the manufacture of reagents and drug calibrator/controls for DEA exempt products. Any other such applicant and any person who is presently registered with DEA to manufacture such a substance may file comments or objections to the issuance of the proposed registration pursuant to 21 CFR 1301.33(a). Any such written comments or objections being sent via regular mail may be addressed, in quintuplicate, to the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA Federal Register Representative, Liaison and Policy Section (ODL); or any being sent via express mail should be sent to DEA Headquarters, Attention: DEA Federal Register Representative/ODL, 2401 Jefferson Davis Highway, Alexandria, Virginia 22301; and must be filed no later than January 30, 2006. Dated: November 18, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6605 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Application Pursuant to Section 1301.33(a) of Title 21 of the Code of Federal Regulations (CFR), this is notice that on August 10, 2005, ISP, Freetown Fine Chemicals, Inc., 238 South Main Street, Assonet, Massachusetts 02702, made application by renewal to the Drug Enforcement Administration
(DEA)for registration as a bulk manufacturer of the basic classes of controlled substances listed in Schedules I and II: Drug Schedule 2,5-Dimethoxyamphetamine
(7396)I Amphetamine
(1100)II Phenylacetone
(8501)II The company plans to manufacture phenylacetone to be used in the manufacture of amphetamine for distribution to its customers. The bulk 2,5-dimethoxyamphetamine will be used for conversion into non-controlled substances. Any other such applicant and any person who is presently registered with DEA to manufacture such a substance may file comments or objections to the issuance of the proposed registration pursuant to 21 CFR 1301.33(a). Any such written comments or objections being sent via regular mail may be addressed, in quintuplicate, to the Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537, Attention: DEA Federal Register Representative, Liaison and Policy Section (ODL); or any being sent via express mail should be sent to DEA Headquarters, Attention: DEA Federal Register Representative/ODL, 2401 Jefferson Davis Highway, Alexandria, Virginia 22301; and must be filed no later than January 30, 2006. Dated: November 21, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6608 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Importer of Controlled Substances; Notice of Registration By Notice dated March 29, 2005 and published in the **Federal Register** on April 6, 2005, (70 FR 17472-17473), Penick Corporation, 158 Mount Olivet Avenue, Newark, New Jersey 07114, made application by renewal to the Drug Enforcement Administration
(DEA)to be registered as an importer of the basic class of controlled substances listed in Schedule II. Drug Schedule Coca Leaves
(9040)II Raw Opium
(9600)II Poppy Straw
(9650)II Concentrate of Poppy Straw
(9670)II The company plans to import the listed controlled substances to manufacturer bulk controlled substances and non-controlled substance flavor extracts. Following the Notice of Application publication on April 6, 2005, (70 FR 17472-17473), Penick Corporation, 158 Mount Olivet Avenue, Newark, New Jersey 07114, relocated its operations to 33 Industrial Park Road, Pennsville, New Jersey 08070 on May 18, 2005. DEA conducted a full investigation and inspection of the company's security which was found to be in compliance with all required regulations. One comment was received; however, the comment was outside of the required 60-day comment and objection period. DEA has considered the factors in 21 U.S.C. 823(a) and 952(a) and determined that the registration of Penick Corporation to import the basic class of controlled substances is consistent with the public interest and with United States obligations under international treaties, conventions, or protocols in effect on May 1, 1971, at this time. DEA has investigated Penick Corporation to ensure that the company's registration is consistent with the public interest. The investigation has included inspection and testing of the company's physical security systems, verification of the company's compliance with state and local laws, and a review of the company's background and history. Therefore, pursuant to 21 U.S.C. 952(a) and 958(a), and in accordance with 21 CFR 1301.34, the above named company is granted registration as an importer of the basic class of controlled substances listed. Dated: November 18, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6606 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Registration By Notice dated April 14, 2005, and published in the **Federal Register** on April 25, 2005 (70 FR 10683), Penick Corporation, Inc., 158 Mount Olivet Avenue, Newark, New Jersey, 07114, made application by renewal to the Drug Enforcement Administration
(DEA)to be registered as a bulk manufacturer of the basic class of controlled substances listed in Schedule II: Drug Schedule Cocaine
(9041)II Codeine
(9050)II Dihydrocodeine
(9120)II Oxycodone
(9143)II Hydromorphone
(9150)II Ecgonine
(9180)II Hydrocodone
(9193)II Morphine
(9300)II Thebaine
(9333)II Oxymorphone
(9652)II The company plans to manufacture the listed bulk controlled substances in bulk for distribution to its customers. Following the Notice of Application publication on April 25, 2005, (70 FR 17472-17473), Penick Corporation, 158 Mount Olivet Avenue, Newark, New Jersey 07114, relocated its operations to 33 Industrial Park Road, Pennsville, New Jersey 08070 on May 18, 2005. DEA conducted a full investigation and inspection of the company's security which was found to be in compliance with all required regulations. One comment was received; however, the comment was not relevant to the company's current activities as a manufacturer of Schedule II controlled substances. DEA has considered the factors in 21 U.S.C. 823(a) and determined that the registration of Penick Corporation to manufacture the listed basic class of controlled substances is consistent with the public interest at this time. DEA has investigated Penick Corporation to ensure that the company's registration is consistent with the public interest. The investigation has included inspection and testing of the company's physical security systems, verification of the company's compliance with state and local laws, and a review of the company's background and history. Therefore, pursuant to 21 U.S.C. 823, and in accordance with 21 CFR 1301.33, the above named company is granted registration as a bulk manufacturer of the basic class of controlled substances listed. Dated: November 18, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6607 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration Manufacturer of Controlled Substances; Notice of Registration By Notice dated June 2, 2005, and published in the **Federal Register** on June 10, 2005, (70 FR 33923), Research Triangle Institute, Kenneth H. Davis Jr., Herman Building, P.O. Box 12194, East Institute Drive, Research Triangle Park, North Carolina 27709, made application by renewal to the Drug Enforcement Administration
(DEA)to be registered as a bulk manufacturer of the basic classes of controlled substances listed in Schedules I and II: Drug Schedule Marihuana
(7360)I Cocaine
(9041)II The Institute will manufacture small quantities of cocaine and marihuana derivatives for use by their customers primarily in analytical kits, reagents and reference standards. No comments or objections have been received. DEA has considered the factors in 21 U.S.C. 823(a) and determined that the registration of Research Triangle Institute to manufacture the listed basic classes of controlled substances is consistent with the public interest at this time. DEA has investigated Research Triangle Institute to ensure that the company's registration is consistent with the public interest. The investigation has included inspection and testing of the company's physical security systems, verification of the company's compliance with state and local laws, and a review of the company's background and history. Therefore, pursuant to 21 U.S.C. 823, and in accordance with 21 CFR 1301.33, the above named company is granted registration as a bulk manufacturer of the basic classes of controlled substances listed. Dated: November 21, 2005. Joseph T. Rannazzisi, Acting Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration. [FR Doc. E5-6592 Filed 11-28-05; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF LABOR Mine Safety and Health Administration Petitions for Modification The following parties have filed petitions to modify the application of existing safety standards under section 101(c) of the Federal Mine Safety and Health Act of 1977. 1. Emerald Coal Resources, LP [Docket No. M-2005-072-C] Emerald Coal Resources, LP, Three Gateway Center, 401 Liberty Avenue, Suite 1340, Pittsburgh, Pennsylvania 15222 has filed a petition to modify the application of 30 CFR 75.364(b)(1) (Weekly examination) to its Emerald No. 1 Mine (MSHA I.D. No. 36-05466) located in Greene County, Pennsylvania. The petitioner requests a modification of the existing standard to permit the use of air monitoring stations to monitor the longwall tailgate airflow in lieu of traveling the entry in its entirety. The petitioner asserts that due to deteriorating roof conditions, traveling the entry in its entirety would be unsafe. The petitioner asserts that the proposed alternative method would provide at least the same measure of protection as the existing standard. Request for Comments Persons interested in these petitions are encouraged to submit comments via E-mail: *zzMSHA-Comments@dol.gov;* Fax:
(202)693-9441; or Regular Mail/Hand Delivery/Courier: Mine Safety and Health Administration, Office of Standards, Regulations, and Variances, 1100 Wilson Boulevard, Room 2350, Arlington, Virginia 22209. All comments must be postmarked or received in that office on or before December 29, 2005. Copies of these petitions are available for inspection at that address. Dated at Arlington, Virginia this 22nd day of November 2005. Rebecca J. Smith, Acting Director, Office of Standards, Regulations, and Variances. [FR Doc. E5-6674 Filed 11-28-05; 8:45 am] BILLING CODE 4510-43-P NUCLEAR REGULATORY COMMISSION [Docket Nos. 50-498 and 50-499] STP Nuclear Operating Company, et al.; South Texas Project, Units 1 and 2; Notice of Consideration of Approval of Application Regarding Proposed Corporate Restructuring and Opportunity for a Hearing The U.S. Nuclear Regulatory Commission (the Commission) is considering the issuance of an order under section 50.80 of Title 10 of the Code of Federal Regulations (10 CFR) approving the indirect transfer of Facility Operating License No. NPF-76 and Facility Operating License No. NPF-80 for the South Texas Project, Units 1 and 2 (STP), respectively, to the extent currently held by Texas Genco, LP (Texas Genco). The City Public Service Board of San Antonio, and the City of Austin, Texas, co-own the units with Texas Genco but are not involved in this proposed action. STP Nuclear Operating Company (STPNOC) is authorized to act for the owners, and has exclusive responsibility and control over the physical construction, operation, and maintenance of STP. STP Nuclear Operating Company, acting on behalf of Texas Genco and NRG Energy, Inc. (NRG Energy), has requested that the Commission consent to the indirect transfer of control of Texas Genco's 44 percent interest in STP. NRG Energy and Texas Genco LLC have entered into a definitive agreement for NRG Energy to acquire all of the outstanding equity of Texas Genco LLC, which indirectly owns 100 percent of Texas Genco. Texas Genco and NRG Energy seek NRC consent to the indirect transfer of control of the licenses to the extent held by Texas Genco that will result from NRG Energy's acquisition of Texas Genco LLC. In addition to its 44 percent undivided ownership interests in STP, Texas Genco holds a corresponding interest in STPNOC, a not-for-profit Texas corporation, which is the licensed operator of STP. Approval of the indirect transfer of control of the licenses to the extent held by STPNOC is also requested to the extent such approval is necessary. No physical changes to STP or operational changes are being proposed in the application. Pursuant to 10 CFR 50.80, no license, or any right thereunder, shall be transferred, directly or indirectly, through transfer of control of the license, unless the Commission shall give its consent in writing. The Commission will approve an application for the transfer of a license, if the Commission determines that the proposed transferee is qualified to hold the license and that the transfer is otherwise consistent with applicable provisions of law, regulations, and orders issued by the Commission pursuant thereto. Before issuance of the proposed conforming license amendment, the Commission will have made findings required by the Atomic Energy Act of 1954, as amended (the Act), and the Commission's regulations. The filing of requests for hearing and petitions for leave to intervene, and written comments with regard to the license transfer application, are discussed below. Within 20 days from the date of publication of this notice, any person whose interest may be affected by the Commission's action on the application may request a hearing and, if not the applicant, may petition for leave to intervene in a hearing proceeding on the Commission's action. Requests for a hearing and petitions for leave to intervene should be filed in accordance with the Commission's rules of practice set forth in Subpart C “Rules of General Applicability: Hearing Requests, Petitions to Intervene, Availability of Documents, Selection of Specific Hearing Procedures, Presiding Officer Powers, and General Hearing Management for NRC Adjudicatory Hearings,” of 10 CFR Part 2. In particular, such requests and petitions must comply with the requirements set forth in 10 CFR 2.309. Untimely requests and petitions may be denied, as provided in 10 CFR 2.309(c)(1), unless good cause for failure to file on time is established. In addition, an untimely request or petition should address the factors that the Commission will also consider, in reviewing untimely requests or petitions, set forth in 10 CFR 2.309(c)(1)(i)-(viii). Requests for a hearing and petitions for leave to intervene should be served upon counsel for STPNOC, Mr. John E. Matthews at Morgan, Lewis & Bockius, LLP, 1111 Pennsylvania Avenue, NW., Washington, DC 20004 (tel: 202-739-5524; fax: 202-739-3001; e-mail: *jmatthews@morganlewis.com* ); counsel for NRG Energy, Dr. William R. Hollaway at Skadden, Arps, Slate, Meagher & Flom LLP, 1440 New York Avenue, Washington, DC 20005 (tel: 202-371-7819; fax: 202-371-7939; e-mail: *whollawa@skadden.com* ); and counsel for Texas Genco, Mr. Nicholas S. Reynolds at Winston and Strawn, LLP, 1700 K Street, NW., Washington, DC 20006-3817 (tel: 202-282-5717; fax: 202-282-5100; e-mail: *nreynolds@winston.com* ); the General Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001 (e-mail address for filings regarding license transfer cases only: *OGCLT@NRC.gov* ); and the Secretary of the Commission, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, Attention: Rulemakings and Adjudications staff, in accordance with 10 CFR 2.302 and 2.305. The Commission will issue a notice or order granting or denying a hearing request or intervention petition, designating the issues for any hearing that will be held and designating the Presiding Officer. A notice granting a hearing will be published in the **Federal Register** and served on the parties to the hearing. As an alternative to requests for hearing and petitions to intervene, within 30 days from the date of publication of this notice, persons may submit written comments regarding the license transfer application, as provided for in 10 CFR 2.1305. The Commission will consider and, if appropriate, respond to these comments, but such comments will not otherwise constitute part of the decisional record. Comments should be submitted to the Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, Attention: Rulemakings and Adjudications staff, and should cite the publication date and page number of this **Federal Register** notice. For further details with respect to this action, see the application dated October 14, 2005, available for public inspection at the Commission's Public Document Room (PDR), located at One White Flint North, Public File Area O1 F21, 11555 Rockville Pike (first floor), Rockville, Maryland. Publicly available records will be accessible electronically from the Agencywide Documents Access and Management System's (ADAMS) Public Electronic Reading Room on the Internet at the NRC Web site, *http://www.nrc.gov/reading-rm/adams.html* . Persons who do not have access to ADAMS or who encounter problems in accessing the documents located in ADAMS, should contact the NRC PDR Reference staff by telephone at 1-800-397-4209, 301-415-4737, or by e-mail to *pdr@nrc.gov.* Dated at Rockville, Maryland this 21st day of November 2005. For The Nuclear Regulatory Commission. Mohan C. Thadani, Senior Project Manager, Plant Licensing Branch IV , Division of Operating Reactor Licensing, Office of Nuclear Reactor Regulation. [FR Doc. E5-6634 Filed 11-28-05; 8:45 am] BILLING CODE 7590-01-P PENSION BENEFIT GUARANTY CORPORATION Approval of Amendment to Special Withdrawal Liability Rules for Service Employees International Union Local 25 and Participating Employers Pension Trust AGENCY: Pension Benefit Guaranty Corporation. ACTION: Notice of approval. SUMMARY: The Service Employees International Union Local 25 and Participating Employers Pension Trust requested the Pension Benefit Guaranty Corporation (“PBGC”) to approve a plan amendment providing for special withdrawal liability rules for employers that maintain the Plan. PBGC published a Notice of Pendency of the Request for Approval of the amendment on July 6, 2005 (70 FR 38983) (“Notice of Pendency”). In accordance with the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), PBGC is now advising the public that the agency has approved the requested amendment. FOR FURTHER INFORMATION CONTACT: Frank Anderson, Attorney, Office of the Chief Counsel, Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005-4026; Telephone 202-326-4020 (For TTY/TDD users, call the Federal Relay Service toll-free at 1-800-877-8339 and ask to be connected to 202-326-4020). SUPPLEMENTARY INFORMATION: Background Under section 4201 of ERISA, an employer who completely or partially withdraws from a defined benefit multiemployer pension plan becomes liable for a proportional share of the plan's unfunded vested benefits. The statute specifies that a “complete withdrawal” occurs whenever an employer either permanently
(1)ceases to have an obligation to contribute to the plan, or
(2)ceases all operations covered under the plan. See ERISA section 4203(a). Under the second test, therefore, an employer who closes or sells its operations will incur withdrawal liability. Under the first test, an employer who remains in business but who no longer has an obligation to contribute to the plan also is liable. The “partial withdrawal” provisions of sections 4205 and 4206 impose a lesser measure of liability upon employers who greatly reduce, but do not eliminate, the operations that generate contributions to the plan. The withdrawal liability provisions of ERISA are a critical factor in maintaining the solvency of these pension plans and reducing claims made on the multiemployer plan guaranty fund maintained by PBGC. Without withdrawal liability rules, an employer who participates in an underfunded multiemployer plan would have a powerful economic incentive to reduce expenses by withdrawing from the plan. Congress nevertheless allowed for the possibility that, in certain industries, the fact that particular employers go out of business (or cease operations in a specific geographic region) might not result in permanent damage to the pension plan's contribution base. In the construction industry, for example, the work must necessarily take place at the construction site; if that work generates contributions to the pension plan, it does not much matter which employer does the work. Put another way, if a construction employer goes out of business, or stops operations in a geographic area, pension plan contributions will not diminish if a second employer who contributes to the plan fills the void. The plan's contribution base is damaged, therefore, only if the employer stops contributing to the plan but continues to perform construction work in the jurisdiction of the collective bargaining agreement. This reasoning led Congress to adopt a special definition of the term “withdrawal” for construction industry plans. Section 4203(b)(2) of ERISA provides that a complete withdrawal occurs only if an employer ceases to have an obligation to contribute under a plan, but the employer nevertheless performs previously covered work in the jurisdiction of the collective bargaining agreement anytime within five years after the employer ceased its contributions. 1 There is a parallel rule for partial withdrawals from construction plans. Under section 4208(d)(1) of ERISA, “[a]n employer to whom section 4203(b) (relating to the building and construction industry) applies is liable for a partial withdrawal only if the employer's obligation to contribute under the plan is continued for no more than an insubstantial portion of its work in the craft and area jurisdiction of the collective bargaining agreement of the type for which contributions are required.” 1 Section 4203(c)(1) of ERISA applies a similar definition of complete withdrawal to the entertainment industry, except that the pertinent jurisdiction is the jurisdiction of the plan rather than the jurisdiction of the collective bargaining agreement. No plan has ever requested PBGC to determine that it shares the characteristics of an entertainment plan. Section 4203(f) of ERISA provides that PBGC may prescribe regulations under which plans that are not in the construction industry may be amended to use special withdrawal liability rules similar to those that apply to construction plans. Under the statute, the regulations “shall permit the use of special withdrawal liability rules * * * only in industries” that PBGC determines share the characteristics of the construction industry. In addition, each plan application must show that the special rule “will not pose a significant risk to the [PBGC] insurance system.” Section 4208(e)(3) of ERISA provides for parallel treatment of partial withdrawal liability rules. The regulation on Extension of Special Withdrawal Liability Rules (29 CFR part 4203), prescribes the procedures a multiemployer plan must follow to request PBGC approval of a plan amendment that establishes special complete or partial withdrawal liability rules. Under 29 CFR 4203.3(a), a complete withdrawal rule must be similar to the statutory provision that applies to construction industry plans under section 4203(b) of ERISA. Any special rule for partial withdrawals must be consistent with the construction industry partial withdrawal provisions. Each request for approval of a plan amendment establishing special withdrawal liability rules must provide PBGC with detailed financial and actuarial data about the plan. In addition, the applicant must provide PBGC with information about the effects of withdrawals on the plan's contribution base. As a practical matter, the plan must show that the characteristics of employment and labor relations in its industry are sufficiently similar to those in the construction industry that use of the construction rule would be appropriate. Relevant factors include the mobility of the employees, the intermittent nature of the employment, the project-by-project nature of the work, extreme fluctuations in the level of an employer's covered work under the plan, the existence of a consistent pattern of entry and withdrawal by employers, and the local nature of the work performed. PBGC will approve a special withdrawal liability rule only if a review of the record shows that:
(1)The industry has characteristics that would make use of the special construction withdrawal rules appropriate; and
(2)The adoption of the special rule would not aversely affect the plan. After review of the application and all public comments, PBGC may approve the amendment in the form proposed by the plan, approve the application subject to conditions or revisions, or deny the application. Request On July 6, 2005, PBGC published a notice soliciting public comment on a request on behalf of the Service Employees International Union Local 25 and Participating Employers Pension Trust (“Plan”) for approval of an amendment prescribing special withdrawal liability rules that, if approved by PBGC, would be effective as of September 30, 2002. PBGC received no comments on the notice. The plan is a multiemployer plan covering the commercial building cleaning and security industry in Chicago, Illinois. It is maintained pursuant to collective bargaining agreements with the Building Owners and Managers Association of Chicago and independent cleaning contractors. As of October 1, 2003, it had approximately 10,000 active participants and was paying approximately $14.4 million in benefits to 4,157 pensioners and survivors. The plan had 173 contributing employers as of October 1, 2002, and contributions for the year ending September 30, 2003, were $10.7 million. The number of contributing employers has remained stable from 1996-2002, with a small increase in 2001 when employees of independent contractors who clean Chicago public school and police stations became participants in the plan. Between 1996 and 2002, the number of active participants increased by almost 67%. Contributions have increased at a faster rate than benefit payments, with increases occurring as new groups were added to the plan; in 1997, benefits were 248% of contributions and in 2003 they were 134% of contributions. The contribution rate was $12 per employee per week from 1981 until 2003, when it was increased to $18 per employee per week. Since October 1, 2001, the monthly benefit has been $27 for each year of credited service after December 1, 1968, plus $10 per year of credited service before December 1, 1968. Total service is limited to 25 years. (In 1999, the rate was $25 and in 2000, it was $26.) In addition, the plan has increased the pensions of retirees by 4.87% in 1998 and by 1.00% in 2000. Summary of Actuarial Valuation Results, 2000-2003 Item Valuation Date (October 1) 2003 2002 2001 2000 Active participants 10,297 10,061 7,995 7,182 Retirees 4,157 4,088 4,146 4,070 Monthly benefit accrual rate 27 27 27 26 Max. monthly benefit 675 675 675 650 Contributions 10,739 7,804 6,579 5,340 Benefits
(000)14,424 13,786 13,258 12,839 Accrued liability
(000)229,508 217,770 210,172 196,940 Market value of assets
(000)195,336 174,021 189,389 219,731 Net min. funding charge w/o credit bal.
(000)14,039 12,822 9,338 6,974 Normal cost
(000)8,888 8,674 6,719 5,585 Unfunded accrued liability*
(000)34,172 43,749 20,783 (22,791) Present value of vested benefits
(000)206,284 198,020 192,041 183,588 Unfunded liability, vested benefits*
(000)10,948 23,999 2,652 (36,143) Valuation interest rate (%) 7.5 7.5 7.5 7.5 * Using market value of assets Decision on the Proposed Amendment The statute and the implementing regulation state that PBGC must make two factual determinations before it approves a request for an amendment that adopts a special withdrawal liability rule. ERISA section 4203(f); 29 CFR 4203.4(a). First, on the basis of a showing by the plan, PBGC must determine that the amendment will apply to an industry that has characteristics that would make use of the special rules appropriate. Second, PBGC must determine that the plan amendment will not pose a significant risk to the insurance system. PBGC's discussion on each of those issues follows. After review of the record submitted by the Plan, and having received no public comments, PBGC has entered the following determinations. 1. What Is the Nature of the Industry? In determining whether an industry has the characteristics that would make an amendment to special rules appropriate, an important line of inquiry is the extent to which the Plan's contribution base resembles that found in the construction industry. This threshold question requires consideration of the effect of employer withdrawals on the Plan's contribution base. Work covered by this plan must be performed at the office building located in Chicago. Thus, the work is local in nature; it generally will continue to be covered by the Plan. An employer ceases contributing when work is outsourced, the contractor loses a cleaning or security contract with a building owner, bankruptcy, closeout of a business as a result of retirement, or business relocation. Over the past ten years, cessation of contributions by any individual employer has not had an adverse impact on the Plan's contribution base. Most employers that have ceased to contribute have been replaced by another employer who begins contributing for the same work. 2. What Is the Exposure and Risk of Loss to PBGC and Participants? *Exposure.* The bargaining parties have increased benefits for active workers by just over 25% since 1999. For a participant who retires with 25 years of service (the maximum) the monthly benefit has risen from $538 to $675. Thus, benefit liabilities will rise because recent retirees will have higher benefits. *Risk of loss.* The record shows that the Plan presented a low risk of loss to PBGC guaranty funds. The Plan's active participant population is increasing. Plan assets increased from 1997 to 2000, and dipped slightly after that. While no longer fully funded for accrued or vested benefits, underfunding decreased in 2003. The Plan and the covered industry have unique characteristics that suggest that the Plan's contribution base is likely to remain stable. Contributions to the Plan are made with respect to Chicago commercial office buildings. Consequently, the Plan's contribution base is secure and the departure of one employer from the Plan is not likely to have an adverse effect on the contribution base so long as the number of buildings covered does not decline. Conclusion Based on the facts of this case and the representations and statements made in connection with the request for approval, PBGC has determined that the plan amendment modifying special withdrawal liability rules
(1)will apply only to an industry that has characteristics that would make the use of special withdrawal liability rules appropriate, and
(2)will not pose a significant risk to the insurance system. Therefore, PBGC hereby grants the Plan's request for approval of a plan amendment modifying special withdrawal liability rules, as set forth herein. Should the Plan wish to amend these rules at any time, PBGC approval of the amendment will be required. Issued at Washington, DC, on this 17th day of November, 2005. Bradley D. Belt, Executive Director, Pension Benefit Guaranty Corporation. [FR Doc. E5-6625 Filed 11-28-05; 8:45 am] BILLING CODE 7708-01-P SECURITIES AND EXCHANGE COMMISSION [File No. 1-31816] Issuer Delisting; Notice of Application of Centennial Specialty Foods Corporation To Withdraw Its Common Stock, $.0001 Par Value, From Listing and Registration on the Boston Stock Exchange, Inc. November 22, 2005. On November 4, 2005, Centennial Specialty Foods Corporation, a Delaware corporation (“Issuer”), filed an application with the Securities and Exchange Commission (“Commission”), pursuant to Section 12(d) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 12d2-2(d) thereunder, 2 to withdraw its common stock, $.0001 par value (“Security”), from listing and registration on the Boston Stock Exchange, Inc. (“BSE”). 1 15 U.S.C. 78 *l* (d). 2 17 CFR 240.12d2-2(d). On November 1, 2004, the Board of Directors (“Board”) of the Issuer approved resolutions on November 1, 2005 to withdraw the Security from listing on BSE. The Issuer stated that the following reason factored into the Board's decision to withdraw the Security from BSE:
(1)The Issuer was recently delisted from the Nasdaq Stock Market, and as a result, BSE suspended trading in the Security on October 26, 2005;
(2)the Issuer does not believe it will be able to comply with BSE's requirement to have an audit committee composed of at least three independent board members; and
(3)in order to reduce costs, the Issuer expects to terminate its obligations to file reports with the Commission or otherwise be subjected to the Act through filing of Form 15 with the Commission. The Issuer stated in its application that it has complied with Rule 12d-2-2(d) under the Act 3 by complying with all applicable laws in the State of Delaware, the state in which the Issuer is incorporated, and by providing BSE with the required documents governing the withdrawal of securities from listing and registration on BSE. The Issuer's application relates solely to the withdrawal of the Security from listing on BSE and shall not affect its obligation to be registered under Section 12(b) of the Act. 4 3 *See id* . 4 15 U.S.C. 78 *l* (b). Any interested person may, on or before December 15, 2005 comment on the facts bearing upon whether the application has been made in accordance with the rules of BSE, and what terms, if any, should be imposed by the Commission for the protection of investors. All comment letters may be submitted by either of the following methods: Electronic Comments • Send an e-mail to *rule-comments@sec.gov* . Please include the File Number 1-31816 or; Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number 1-31816. This file number should be included on the subject line if e-mail is used. To help us 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/delist.shtml* ). Comments are also available for public inspection and copying in the Commission's Public Reference Room. All comments received will be posted without change; we do not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. The Commission, based on the information submitted to it, will issue an order granting the application after the date mentioned above, unless the Commission determines to order a hearing on the matter. 5 17 CFR 200.30-3(a)(1). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 5 Jonathan G. Katz, Secretary. [FR Doc. E5-6662 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [File No. 1-32657] Issuer Delisting; Notice of Application of Nabors Industries Ltd. To Withdraw Its Common Shares, $.001 Par Value, From Listing and Registration on the American Stock Exchange LLC November 22, 2005. On November 3, 2005, Nabors Industries Ltd., a Bermuda exempted company (“Issuer”), filed an application with the Securities and Exchange Commission (“Commission”), pursuant to Section 12(d) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 12d2-2(d) thereunder, 2 to withdraw its common shares, $.001 par value (“Security”), from listing and registration on the American Stock Exchange LLC (“Amex”). 1 15 U.S.C. 78 *l* (d). 2 17 CFR 240.12d2-2(d). On the Board of Directors (“Board”) of the Issuer unanimously approved a resolution on May 6, 2005, to withdraw the Security from listing on Amex and to list the Security on the New York Stock Exchange, Inc. (“NYSE”). The Issuer stated that the Board's reason to withdraw the Security from Amex and list the Security on NYSE was to avoid direct and indirect costs and the division of the market resulting from dual listing on Amex and NYSE. The Issuer stated in its application that it has met the requirements of Amex Rule 18 by complying with all applicable laws in effect in Bermuda, in which it is incorporated, and providing written notice of withdrawal to Amex. The Issuer's application relates solely to the withdrawal of the Security from listing on Amex, and shall not affect its continued listing on NYSE or its obligation to be registered under Section 12(b) of the Act. 3 3 15 U.S.C. 78 *1* (b). Any interested person may, on or before December 15, 2005, comment on the facts bearing upon whether the application has been made in accordance with the rules of Amex, and what terms, if any, should be imposed by the Commission for the protection of investors. All comment letters may be submitted by either of the following methods: Electronic Comments • Use the Commission's Internet comment form ( *http://www.sec.gov/rules/delist.shtml* ); or • Send an e-mail to *rule-comments@sec.gov* . Please include the File Number 1-32657 or; Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number 1-32657. This file number should be included on the subject line if e-mail is used. To help us 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/delist.shtml* ). Comments are also available for public inspection and copying in the Commission's Public Reference Room. All comments received will be posted without change; we do not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. The Commission, based on the information submitted to it, will issue an order granting the application after the date mentioned above, unless the Commission determines to order a hearing on the matter. 4 17 CFR 200.30-3(a)(1). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 4 Jonathan G. Katz, Secretary. [FR Doc. E5-6663 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52823; File No. SR-CBOE-2005-90] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of a Proposed Rule Change To Adopt a Simple Auction Liaison System To Auction Qualifying Marketable Orders for Potential Price Improvement November 22, 2005. 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 October 26, 2005, the Chicago Board Options Exchange, Incorporated (“CBOE” 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 prepared by CBOE. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend its rules to adopt a Simple Auction Liaison (“SAL”) system to auction qualifying inbound orders for potential price improvement. Below is the text of the proposed rule change. Proposed new language is in *italics* . Chicago Board Options Exchange, Incorporated Rules Rule 6.13. CBOE Hybrid System's Automatic Execution Feature
(a)No change.
(b)Automatic Execution
(i)Eligibility: Orders eligible for automatic execution through the CBOE Hybrid System may be automatically executed in accordance with the provisions of this Rule *or in accordance with Rule 6.13A for classes that have been designated for auction price improvement* . This section governs automatic executions and split-price automatic executions. The automatic execution and allocation of orders or quotes submitted by market participants also is governed by Rules 6.45A(c) and (d). (ii)-(iv) No change. (c)-(e) No change. Rule 6.13A Simple Auction Liaison
(SAL)*This Rule governs the operation of the SAL system. SAL is a feature within the Hybrid System that auctions marketable orders for price improvement over the NBBO.* *(a) SAL Eligibility. The Exchange, with input from the appropriate Floor Procedure Committee, shall designate the eligible order size, eligible order type, eligible order origin code (i.e. public customer orders, non-market maker broker-dealer orders, and market maker broker-dealer orders), and classes in which SAL shall be activated. For such classes, SAL shall automatically initiate an auction process for any order that is eligible for automatic execution by the Hybrid System pursuant to Rule 6.13 (“Agency Order”), except when the Exchange's disseminated quotation contains one or more resting limit orders and does not contain sufficient Market-Maker quotation size to satisfy the entire Agency Order.* *(b) SAL Auction. Prior to commencing the auction, SAL shall stop the Agency Order at the NBBO against Market-Maker quotations displayed at the NBBO on the opposite side of the market as the Agency Order. SAL will not allow such quotations to move to an inferior price or size throughout the duration of the auction. The auction will last for a period of time not to exceed two
(2)seconds as determined by the Exchange on a class-by-class basis. Auction responses may be submitted by Market-Makers with an appointment in the relevant option class and Members acting as agent for orders resting at the top of the Exchange's book opposite the Agency Order. With respect to responses, the following shall apply:* *(i) Responses shall not be visible to other auction participants and shall not be disseminated to OPRA.* *(ii) Responses may be submitted in one-cent increments.* *(iii) Multiple responses are allowed.* *(iv) Responses may be cancelled.* *(v) Responses cannot cross the Exchange's disseminated quotation on the opposite side of the market.* *(c) Allocation of Agency Orders. Agency Orders may be executed at multiple prices and shall be executed in two rounds per price point as follows:* *(i) First Round Allocation. The Agency Order shall first be allocated at the prevailing price (the “First Allocation Round”) between all parties that represented the Exchange's NBBO quotation at the time the auction commenced (“Original Quoters”) up to the size of such quotation. During the First Allocation Round, the following shall apply:* *(1) the Agency Order shall be allocated pursuant to the matching algorithm in effect for the class pursuant to Rules 6.45A or 6.45B as appropriate;* *(2) An Original Quoter may only participate in a First Round Allocation at each execution price up to its size at the NBBO at the time the auction commenced; and* *(3) If the applicable matching algorithm includes a participation entitlement, then Market-Makers that qualify for a participation entitlement at the NBBO price will receive a participation entitlement if they match the executing auction price(s).* *(ii) Second Allocation Round. If an Agency Order is not fully executed during the First Allocation Round at a particular price point, then a Second Allocation Round shall occur. During this round, all responses received during the auction at the prevailing auction price that were not eligible for the First Allocation Round shall participate in accordance with the matching algorithm in effect for the class, and the size of such responses shall be capped to the size of the Agency Order for allocation purposes. There shall be no participation right during the Second Allocation Round.* *(d) Early Termination of Auction. The auction will terminate early under the following circumstances:* *(i) If the Hybrid System receives an unrelated non-marketable limit order on the opposite side of the market from the Agency Order that improves any auction responses, the unrelated order will trade (after any responses that were priced better than the unrelated order have traded) to the fullest extent possible at the midpoint of the best remaining auction response and the unrelated order's limit price (rounded towards the unrelated order's limit price when necessary).* *(ii) If the Hybrid System receives an unrelated market or marketable limit order on the opposite side of the market from the Agency Order, such unrelated order will trade to the fullest extent possible at the midpoint of the best auction response and the NBBO on the opposite side of the market from the auction responses (rounded towards the disseminated quote when necessary).* *(iii) If the Hybrid System receives an unrelated order on the same side of the market as the Agency Order that is marketable against the NBBO, then the auction shall conclude and the Agency Order shall trade against the prevailing responses in accordance with subparagraph
(c)above.* *(iv) Any time there is a quote lock on the Exchange pursuant to Rule 6.45A(d).* *(v) Any time a response matches the Exchange's disseminated quote on the opposite side of the market from the response.* . . . Interpretations and Policies *.01 A pattern or practice of submitting unrelated orders that cause an exposure period to conclude early will be deemed conduct inconsistent with just and equitable principles of trade and a violation of Rule 4.1 and other Exchange Rules.* *.02 Disseminating information regarding auctioned orders to third parties will be deemed conduct inconsistent with just and equitable principles of trade and a violation of Rule 4.1 and other Exchange Rules.* II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CBOE included statements concerning the purpose of and basis for the proposal and discussed any comments it received on the proposal. The text of these statements may be examined at the places specified in Item IV below. CBOE 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 purpose of the proposed rule change is to implement SAL, a price improvement auction system for qualifying inbound orders. SAL is a feature within CBOE's Hybrid System that auctions marketable orders for price improvement over the National Best Bid or Offer (“NBBO”). Thus, orders that would otherwise be automatically executed at CBOE's NBBO market will be exposed to a brief auction in penny increments for potential price improvement. SAL would not auction an order if CBOE were not the NBBO market at the time the order was received. As proposed, the Exchange would designate the eligible order size ( *e.g.* , all orders under 100 contracts), eligible order type ( *e.g.* , non-contingency orders), eligible order origin code ( *e.g.* , public customer orders, non-market maker broker-dealer orders, and market maker broker-dealer orders), and classes in which SAL shall be activated. For eligible classes, SAL shall automatically initiate an auction process for any qualifying order (“Agency Order”) that is eligible for automatic execution by the Hybrid System except when the Exchange's disseminated quotation contains one or more resting limit orders and does not contain sufficient quotation size from CBOE Market-Makers to satisfy the entire Agency Order. The reason SAL requires sufficient Market-Maker quote size in the NBBO quote to initiate a SAL auction is because SAL stops the Agency Order against the Market-Maker quotes. If CBOE's NBBO price consisted only of resting limit orders, SAL could not stop the Agency Order against such limit orders because the limit orders might be cancelled prior to the conclusion of the auction. As mentioned above, SAL stops the Agency Order at the NBBO against Market-Maker quotations displayed at the NBBO on the opposite side of the market as the Agency Order. In connection with this stop, SAL will not allow such quotations to move to an inferior price or size throughout the duration of the auction. The auction will last for a period of time not to exceed two
(2)seconds as determined by the Exchange. Auction responses may be submitted by Market-Makers with an appointment in the relevant option class and by CBOE Members acting as agent for orders resting at the top of the Exchange's book opposite the Agency Order. With respect to responses, the following shall apply:
(i)Responses shall not be visible to other auction participants and shall not be disseminated to the Options Price Reporting Authority;
(ii)responses may be submitted in one-cent increments (and not less than one-cent increments);
(iii)multiple responses are allowed;
(iv)responses may be cancelled prior to the conclusion of the auction; and
(v)responses cannot cross the Exchange's disseminated quotation on the opposite side of the market. At the conclusion of the auction period, the Agency Order will be executed at the best auction response prices and may be executed at multiple prices if necessary. The allocation of the execution of the Agency Order shall occur in two rounds at each price point. Participation in the first round (the “First Allocation Round”) is limited to those that constituted the Exchange's NBBO quote (on the side of the market opposite the Agency Order) at the time the SAL auction commenced (“Original Quoters”). This is to encourage aggressive quoting and reward those that set the NBBO market. During the First Allocation Round, the following shall apply:
(i)The Agency Order shall be allocated pursuant to the matching algorithm in effect for the class under Rules 6.45A or 6.45B as appropriate;
(ii)Original Quoters may only participate in a First Allocation Round at each execution price up to their respective size at the NBBO at the time the auction commenced; and
(iii)if the applicable matching algorithm includes a participation entitlement, then Market-Makers that qualified for a participation entitlement at the NBBO price will receive a participation entitlement in a First Allocation Round if they match the execution price for that round. If an Agency Order is not fully executed during the First Allocation Round, then a second round (“Second Allocation Round”) shall occur. During this round, all responses received during the auction at the execution price of the immediately preceding First Allocation Round that were not eligible for that preceding round shall participate in accordance with the matching algorithm in effect for the class. The size of such responses shall be limited to the size of the Agency Order for allocation purposes. There is no participation right during the Second Allocation Round. The following is an example of a SAL auction: The CBOE market of 1.00-1.10 is the NBBO. The 1.10 offer is for 300 contracts and is comprised of Market-Maker A for 100 contracts, Market-Maker B for 100 contracts and Market-Maker C for 100 contracts. A qualifying order is received to buy 100 contracts at 1.10. Instead of automatically executing the order at 1.10, SAL will auction the order. Assume the auction timer is set to one second. At the conclusion of the one-second auction, the following responses were received: Market-Maker A at 1.07 for 10 contracts and at 1.08 for 40 contracts; Market-Maker B at 1.08 for 40 contracts and at 1.09 for 100 contracts; and Market-Maker X at 1.07 for 10 contracts and at 1.08 for 100 contracts. The execution of the Agency order will proceed as follows: 10 contracts get filled at 1.07 against Market-Maker A, who is an Original Quoter; 10 contracts get filled at 1.07 against Market-Maker X, who is not an Original Quoter; and the remaining 80 contracts get filled against Market-Makers A and B (40 each) at 1.08. Market-Maker X does not participate at 1.08 since it is not an Original Quoter. The following situations will cause the auction to conclude early. First, if the Hybrid System receives an unrelated non-marketable limit order on the opposite side of the market from the Agency Order that improves any auction responses, the auction will conclude and the unrelated order will trade (after any responses that were priced better than the unrelated order have traded) to the fullest extent possible at the midpoint of the best remaining auction response and the unrelated order's limit price (rounded towards the unrelated order's limit price when necessary). This will allow both the unrelated order and the Agency Order to obtain price improvement. Second, if the Hybrid System receives an unrelated market or marketable limit order on the opposite side of the market from the Agency Order, the auction will conclude and the unrelated order will trade to the fullest extent possible at the midpoint of the best auction response and the NBBO on the opposite side of the market from the auction responses (rounded towards the disseminated quote when necessary). This also provides price improvement to both orders. Third, if the Hybrid System receives an unrelated order on the same side of the market as the Agency Order that is marketable against the NBBO, then the auction will conclude and the Agency Order will trade against the responses at the highest price points. Fourth, the auction will conclude early any time there is a quote lock on the Exchange pursuant to Rule 6.45A(d). Fifth, the auction will conclude early any time a response matches the Exchange's disseminated quote on the opposite side of the market from the response. Lastly, the Exchange seeks to adopt provisions providing that a pattern or practice of submitting unrelated orders that cause an auction to conclude early and disseminating information regarding such orders to third parties will be deemed conduct inconsistent with just and equitable principles of trade and a violation of CBOE Rule 4.1 and, potentially, other Exchange Rules. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with section 6(b) of the Act 3 in general and furthers the objectives of section 6(b)(5) 4 in particular in that by swiftly providing potential price improvement over the NBBO to qualifying inbound orders, it should promote just and equitable principles of trade, serve to remove impediments to and perfect the mechanism of a free and open market and a national market system, and protect investors and the public interest. 3 15 U.S.C. 78f(b). 4 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change would 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 No written comments were solicited or received with respect to the proposed rule change. 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 Number SR-CBOE-2005-90 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-CBOE-2005-90. 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. Copies of the filing also will be available for inspection and copying at the principal office of CBOE. 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-CBOE-2005-90 and should be submitted on or before December 20, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 5 5 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6656 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52818; File No. SR-CBOE-2005-91] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change and Amendment No. 1 Thereto Relating to Its Marketing Fee Program November 22, 2005. 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 November 2, 2005, the Chicago Board Options Exchange, Incorporated (“CBOE” 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 prepared by the Exchange. On November 17, 2005, the CBOE submitted Amendment No. 1 to the proposed rule change. 3 The CBOE has designated this proposal as one changing a fee imposed by the CBOE under Section 19(b)(3)(A)(ii) of the Act 4 and Rule 19b-4(f)(2) thereunder, 5 which renders the proposal, as amended, effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 Partial Amendment No. 1 (“Amendment No. 1”):
(1)Amended the effective date of the proposal from November 1, 2005 to November 2, 2005;
(2)amended the purpose section of the filing to clarify that the Preferred Market-Maker Program is a pilot program set to expire on June 2, 2006;
(3)amended the rule text to specify that the marketing fee program will expire on June 2, 2006, the date the Preferred Market-Maker Program is set to expire; and
(4)made a technical correction to a footnote. 4 15 U.S.C. 78s(b)(3)(A)(ii). 5 17 CFR 240.19b-4(f)(2). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The CBOE proposes to amend its Fees Schedule and its marketing fee program in a number of respects, including to permit a “Preferred Market-Maker” to direct the Exchange to disburse funds generated by the marketing fee where an order provider sends an order to the Exchange designating a Preferred Market-Maker. These changes to the marketing fee program would be effective November 2, 2005 and remain in effect until June 2, 2006, which is the date that CBOE's pilot program establishing its Preferred Market-Maker program is scheduled to expire, unless extended through a rule filing submitted to and approved by the Commission. 6 6 *See* Amendment No. 1, *supra* note 3. Below is the text of the proposed rule change, as amended. Proposed new language is in *italic* ; proposed deletions are in [brackets]. 7 7 *Id.* CHICAGO BOARD OPTIONS EXCHANGE, INC. FEES SCHEDULE [October 25] November 2, 2005 1. No Change. 2. MARKETING FEE (6)(16)—$.22 3.-4. No Change. FOOTNOTES: (1)-(5) No Change.
(6)The Marketing Fee will be assessed only on transactions of Market-Makers, RMMs, e-DPMs, DPMs, and LMMs at the rate of $.22 per contract on all classes of equity options, options on HOLDRs, options on SPDRs, and options on DIA. The fee will not apply to Market-Maker-to-Market-Maker transactions. This fee shall not apply to index options and options on ETFs (other than options on SPDRs and options on DIA). *If less than 80% of the marketing fee funds are paid out by the DPM or LMM in a given month, then* [Should any surplus of the marketing fees at the end of each month occur,] the Exchange would [then] refund such surplus at the end of the month[, if any,] on a pro rata basis based upon contributions made by the Market-Makers, RMMs, e-DPMs, DPMs and LMMs. *However, if 80% or more of the accumulated funds in a given month are paid out by the DPM or LMM, there will not be a rebate for that month and the funds will carry over and will be included in the pool of funds to be used by the DPM or LMM the following month. At the end of each quarter, the Exchange would then refund any surplus, if any, on a pro rata basis based upon contributions made by the Market-Makers, RMMs, DPMs, e-DPMs and LMMs. CBOE's marketing fee program as described above will be in effect until June 2, 2006.* 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 CBOE included statements concerning the purpose of and basis for the proposed rule change, as amended, and discussed any comments it received on the proposed rule change, as amended. The text of these statements may be examined at the places specified in Item IV below. The CBOE 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 Exchange states that on October 29, 2004, it amended its marketing fee program. 8 The current marketing fee is assessed upon Designated Primary Market-Makers (“DPMs”), Electronic DPMs (“e-DPMs”), Remote Market-Makers (“RMMs”), Lead Market-Makers (“LMMs”), and Market-Makers at a rate of $0.22 for every contract they enter into on the Exchange other than Market-Maker-to-Market-Maker transactions (which includes all transactions between any combination of DPMs, e-DPMs, RMMs, LMMs, and Market-Makers). The marketing fee is assessed in all equity option classes and options on HOLDRs ® 9 , options on SPDRs ® 10 and options on DIA. 11 The Exchange represents that the purpose of the marketing fee program is to provide the members of the Exchange with the ability to compete for the opportunity to trade with those orders that may otherwise be routed to other exchanges. 8 For a description of CBOE's marketing fee program, *see* Securities Exchange Act Release No. 50736 (November 24, 2004), 69 FR 69966 (December 1, 2004) (SR-CBOE-2004-68). 9 HOLDRs are trust-issued receipts that represent an investor's beneficial ownership of a specified group of stocks. *See* Interpretation .07 to CBOE Rule 5.3. 10 *See* , Securities Exchange Act Release No. 51052 (January 18, 2005), 70 FR 3757 (January 26, 2005) (SR-CBOE-2005-05). 11 *See* , Securities Exchange Act Release No. 52474 (September 20, 2005), 70 FR 56520 (September 27, 2005) (SR-CBOE-2005-72). The Exchange states that under the current program, all funds generated by the marketing fee are collected by the Exchange and recorded according to the DPM or LMM, as applicable, station and class where the options subject to the fee are traded. The money collected is disbursed by the Exchange according to the instructions of the DPM or LMM. Those funds are made available to the DPM or LMM solely for those trading crowds where the fee was assessed and may only be used by that DPM or LMM to attract orders in the classes of options for which the fee was assessed. CBOE recently obtained approval of a rule filing adopting a Preferred Market-Maker program. 12 Under that program, order providers can send an order to the Exchange designating any CBOE Market-Maker (including any DPM, e-DPM, LMM, RMM, and Market-Maker) as a Preferred Market-Maker. If the Preferred Market-Maker is quoting at the NBBO at the time the order is received on CBOE, the Preferred Market-Maker is entitled to a participation entitlement of 50% when there is one Market-Maker also quoting at the best bid/offer on the Exchange and 40% when there are two or more Market-Makers quoting at the best bid/offer on the Exchange. 12 *See* Securities Exchange Act Release No. 52506 (September 23, 2005), 70 FR 57340 (September 30, 2005) (SR-CBOE-2005-58). CBOE proposes to amend its marketing fee program in a number of respects in light of the recent adoption of its Preferred Market-Maker program. These changes to the marketing fee program would be effective November 2, 2005 and expire on June 2, 2006, which is the date that CBOE's pilot program establishing its Preferred Market-Maker program is scheduled to expire, unless extended through a rule filing submitted to and approved by the Commission. 13 In particular, CBOE proposes to amend its marketing fee program to provide that a Market-Maker would have access to the marketing fee funds generated by orders sent to the Exchange designating that Market-Maker as a “Preferred Market-Maker.” 13 *See* Amendment No. 1, *supra* note 3. The following is a description of the three-step process by which the entire pool of funds generated by the marketing fee would be apportioned between the DPM or LMM, and Preferred Market-Makers. First, consistent with the current program, each month all funds generated by the marketing fee would be collected by the Exchange and recorded according to the DPM or LMM, as applicable, station and class where the option classes subject to the fee are traded. If a Market-Maker (including any DPM, e-DPM, LMM, and RMM) is designated as a Preferred Market-Maker on an order from a payment accepting firm (“PAF”), the Market-Maker would be given access to the marketing fee funds generated from that order, even if the Preferred Market-Maker did not participate in the execution of the order because the Market-Maker was not quoting at the NBBO at the time the order was received on CBOE. 14 The Exchange believes that it is appropriate to give Preferred Market-Makers access to all of the funds generated by the marketing fee for any order as to which they were designated the Preferred Market-Maker because the Preferred Market-Maker negotiated with a PAF to send their order flow to CBOE and to designate a particular Market-Maker as the Preferred Market-Maker. Second, the DPM or LMM, as applicable, would be given access to the marketing fee funds generated from all other orders from PAFs in its appointed classes in a particular trading station. Third, the marketing fee funds generated by orders from non-PAFs, if any, would be apportioned monthly among the DPM or LMM, and Preferred Market-Makers on a on a pro-rata basis, based on the percentage of contracts traded by each DPM or LMM and Preferred Market-Maker against orders from PAFs during the month in the option classes located at a particular trading station. 14 For example, assume a Market-Maker is designated as a Preferred Market-Maker on an order for 50 contracts which is executed on CBOE. Under this first step, the Preferred Market-Maker would be given access to a total of $11 (50 contracts × $.22), whether or not the Preferred Market-Maker traded with the order or not. The following is an example of how funds generated from CBOE's marketing fee program would be allocated to Preferred Market-Makers, DPMs, and LMMs pursuant to the preceding three steps. As noted above, each month all funds generated by the marketing fee are collected by the Exchange and recorded according to the DPM or LMM, as applicable, station and class where the option classes subject to the fee are traded. Thus, assuming 45,455 contracts traded in a particular month at Station 1 on the trading floor, $10,000 (45,455 contracts × $.22) would be generated as a result of the marketing fee to be used to attract order flow to CBOE. Pursuant to Step 1, assuming the DPM and two other Market-Makers were designated as Preferred Market-Makers for orders executed in option classes at Station 1, they would be allocated the following funds: Contracts Funds Allocated DPM 5,000 $1,100 ($.22 * 5,000) Preferred Market-Maker #1 2,500 $550 ($.22 * 2,500) Preferred Market-Maker #2 3,500 $770 ($.22 * 3,500) Total 11,000 $2,420 ($.22 * 11,000) Pursuant to Step 2, the Exchange would determine the amount of funds generated from orders from PAFs that were executed in option classes at Station 1, and these funds would be allocated to the DPM to attract order flow to CBOE. Assuming orders from PAFs representing 10,000 contracts were executed with Market-Makers (including the DPM or LMM, e-DPM(s), and RMM(s)), at Station 1, $2,200 (10,000*$.22) in funds would be generated and allocated to the DPM. As a result of Steps 1 and 2 above, the original pool of funds generated by the marketing fee at Station ($10,000), would have been depleted in Step 1 by $2,420, and in Step 2 by $2,200. Assuming remaining number of contracts executed at Station 1, *i.e.* , 24,455 contracts, 15 were from orders from non-PAFs, a total of $5,380 (24,455 * $.22) would be the remaining balance of funds. Pursuant to Step 3, these funds would be apportioned monthly among the DPM (or LMM) and Preferred Market-Makers on a pro-rata basis, based on the percentage of contracts traded by each DPM (or LMM) and Preferred Market-Maker against orders from PAFs. Assuming the DPM and the two Preferred Market-Makers executed the following percentage of contracts from orders from PAFs at Station 1, they would be allocated the following funds: 15 45,455 less 11,000 contracts (see Step 1) and 10,000 contracts (see Step 2). % of PAF contracts (percent) Funds allocated (percent) DPM 65 $3,497 (65 * $5,380) Preferred Market-Maker #1 15 807 (15 * $5,380) Preferred Market-Maker #2 20 1,076 (20 * $5,380) The funds generated by the marketing fee would continue to be collected by the Exchange and recorded according to the applicable trading station and class where the options subject to the fee are traded. The money collected would be disbursed by the Exchange according to the instructions of the DPM, LMM or the Preferred Market-Maker. These funds shall only be used to attract order flow to CBOE from PAF, and the funds made available to the DPM or LMM may only be used to attract orders in the option classes located at the trading station where the fee was assessed. Thus, a member organization appointed as the DPM at a particular trading station on the trading floor cannot use the funds from that trading station to attract order flow to another trading station on the trading floor where that member serves as the DPM. Additionally, the Exchange does not intend to continue to require that the funds collected from e-DPMs and RMMs can only be used to attract order flow for the classes in which the e-DPM or RMM is appointed. The Exchange does not believe such a restriction is necessary or reasonable in light of manner in which firms negotiate with PAFs to direct their order flow to the Exchange. Specifically, the Exchange notes that many DPMs or LMMs negotiate with PAFs to route their order flow to the Exchange for all of the classes located at a particular trading station, and not necessarily on a class-by-class basis. Additionally, any use of the marketing fees by the DPM outside of an RMM's or an e-DPM's appointment may still benefit the RMM or e-DPM because e-DPMs and RMMs are permitted under Exchange rules to enter orders in option classes traded on the Exchange that are not included within their appointment. Therefore, the Exchange believes that there is an equitable allocation of use of the fees by the DPM because the order flow from a PAF can be accessed by an RMM or eDPM, outside their appointments, through “M” orders. In the event a Preferred Market-Maker does not disburse all of the funds generated by the marketing fee in a given month, then the funds the Preferred Market-Maker does not disburse would be made available to the DPM or LMM, as applicable, for the following month to attract orders in the classes of options where the DPM or LMM is appointed. Finally, the Exchange proposes to amend the program with respect to the manner in which surplus funds are refunded to Market-Makers, RMMs, DPMs, e-DPMs, and LMMs. Currently, the Exchange refunds any surplus at the end of the month on a pro rata basis based upon contributions made by the Market-Makers, RMMs, DPMs, e-DPMs, and LMMs. Going forward, if 80% or more of the accumulated funds in a given month are paid out by the DPM or LMM, there would not be a rebate for that month and the funds would carry over and would be included in the pool of funds to be used by the DPM or LMM in the following month. If less than 80% of the funds is paid out, Market-Maker rebates would continue to be made on a monthly basis. At the end of each quarter, the Exchange would then refund any surplus, if any, on a pro rata basis based upon contributions made by the Market-Makers, RMMs, DPMs, e-DPMs, and LMMs. In the foregoing example, the DPM and Preferred Market-Maker #1 and Preferred Market-Maker #2 were allocated the following amounts: Total allocated DPM $6,797 ($1,100 + 2,200 + 3,497) Preferred Market-Maker #1 1,357 ($550 + 807) Preferred Market-Maker #2 1,846 ($770 + 1076) If the DPM only paid out a total of $6,150 of the $6,797 allocated to it in a given month (or 90% of its funds), then $647 would carry over for the DPM to use to attract order in the following month. If Preferred Market-Maker #1 paid out a total of $1,200 of the $1,357 allocated to it in a given month, then $157 would be made available to the DPM (or LMM) for the following month to attract orders in the classes of options where the DPM (or LMM) is appointed. If Preferred Market-Maker #2 paid out a total of $1,846 allocated to it in a given month, then none of Preferred Market-Maker #2's funds would carry over to the DPM (or LMM) for the following month. As in the current marketing fee program, the Exchange would not be involved in the determination of the terms governing the orders that qualify for payment with any PAF or the amount of any such payment. The Exchange would provide administrative support for the program in such matters as maintaining the funds, keeping track of the number of qualified orders each firm directs to the Exchange, and making the necessary debits and credits to the accounts of the traders and the PAFs to reflect the payments that are made. Exchange Market-Makers, RMMs, DPMs, e-DPMs, and LMMs would have no way of identifying prior to execution whether a particular order is from a PAF or a non-PAF. 2. Statutory Basis The Exchange believes that its proposal, as amended, is consistent with Section 6(b) of the Act 16 in general, and furthers the objectives of Section 6(b)(4) of the Act 17 in particular, in that it is an equitable allocation of reasonable dues, fees, and other charges among CBOE members and other persons using its facilities. 16 15 U.S.C. 78f(b). 17 15 U.S.C. 78f(b)(4). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change, as amended, will impose any inappropriate burden on competition 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 No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change, as amended, has been designated as a fee change pursuant to Section 19(b)(3)(A)(ii) of the Act 18 and Rule 19b-4(f)(2) 19 thereunder, because it establishes or changes a due, fee, or other charge imposed by the Exchange. Accordingly, the proposal will took effect upon filing with the Commission. At any time within 60 days of the filing of such proposed rule change, as amended, the Commission may summarily abrogate such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 20 18 15 U.S.C. 78s(b)(3)(A)(ii). 19 17 CFR 240.19b-4(f)(2). 20 The effective date of the original proposed rule change is November 2, 2005, the effective date of Amendment No. 1 is November 17, 2005. For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposal, the Commission considers the period to commence on November 17, 2005, the date on which the Exchange submitted Amendment No. 1. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as amended, 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-CBOE-2005-91 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-CBOE-2005-91. 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, as amended, 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. Copies of such filing also will be available for inspection and copying at the principal office of the CBOE. 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-CBOE-2005-91 and should be submitted on or before December 20, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 21 21 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6659 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52815; File No. SR-CHX-2005-31] Self-Regulatory Organizations; Chicago Stock Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Participant Fees and Credits November 21, 2005. 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 October 24, 2005, 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 prepared by the CHX. On November 7, 2005, the Exchange filed Amendment No. 1 to the proposed rule change. 3 The Exchange filed the proposed rule change pursuant section 19(b)(3)(A) of the Act 4 and Rule 19b-4(f)(2) 5 thereunder, which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 Amendment No. 1 replaced the original filing in its entirety. 4 15 U.S.C. 78s(b)(3)(A). 5 17 CFR 240.19b-4(f)(2). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The CHX proposes to amend its Participant Fee Schedule (“Fee Schedule”) to modify the trading permit fee due the Exchange from a participant if the participant's trading permit is cancelled intrayear and to establish a fee associated with a participant's change of name or corporate form. 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 The Exchange proposes to amend its Fee Schedule to modify the trading permit fee due the Exchange from a participant if the trading permit is cancelled intrayear and to establish a fee associated with a participant's change of name or corporate form. The provisions of the Fee Schedule relating to trading permits are relatively new provisions that were added when the Exchange demutualized on February 9, 2005 and issued trading permits upon demutualization and thereafter. Although from a financial perspective, the amount of the trading permit fee ($6,000 per year) is equivalent to pre-demutualization member dues, in fact, trading permits operate much differently than seats on the Exchange. With very limited exceptions, a trading permit cannot be sold, leased, or transferred, and cannot be retained by a participant if the participant is not using the trading permit to trade on the Exchange. As originally drafted, the Fee Schedule contemplated that each participant would be obligated to pay the entire $6,000 annual trading permit fee, regardless of when the trading permit was cancelled during the year. The Exchange believes that it is appropriate to amend the Fee Schedule to provide for some fee relief for participants whose trading permits are cancelled intrayear. The Exchange also believes that it is necessary for the Exchange to have an adequate basis on which to budget and project annual revenues. Accordingly, the Exchange is proposing a change that would provide for the participant to pay, upon intrayear cancellation, the lesser of $2,000 or the then-outstanding balance of the annual fee. This compromise ensures that the Exchange can budget for at least $2,000 in annual revenue per trading permit, while affording a participant a reduction in the annual trading permit fee if the permit is cancelled early in the year. The Exchange also proposes to establish a $200 fee per trading permit that a participant would be charged if the participant firm changed its name or its corporate form. This fee would be charged, for example, if a participant firm changed its name from “XYZ Corporation” to “XY Corporation” or if the participant firm changed its corporate form from a corporation to a limited liability company. Although trading permits generally are not transferable, the Exchange believes it would work a hardship on participants if they were required to obtain new trading permits (and to pay the permit fee on the existing permit, as described above) whenever participant firms changed names or corporate forms. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with section 6(b)(4) of the Act 6 in that it provides for the equitable allocation of reasonable dues, fees, and other charges among its members. 6 15 U.S.C. 78(f)(b)(4). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change, as amended, would impose any burden on competition. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received from Members, Participants or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change, as amended, establishes or changes a due, fee, or other charge imposed by the Exchange and therefore has become effective pursuant to section 19(b)(3)(A) of the Act 7 and subparagraph (f)(2) of Rule 19b-4 thereunder. 8 At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate such rule change, if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purpose of the Act. 9 7 15 U.S.C. 78s(b)(3)(A). 8 17 CFR 240.19b-4(f)(2). 9 For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under section 19(b)(3)(C) of the Act, the Commission considers that period to commence on November 7, 2005, the date the Exchange filed Amendment No. 1 to the proposed rule change. *See* 15 U.S.C. 78s(b)(3)(C). IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as amended, 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-2005-31 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-CHX-2005-31. 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. Copies of such filing also will be available for inspection and copying at the principal offices 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-2005-31 and should be submitted on or before December 20, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 10 10 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6661 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52799; File No. SR-NASD-2005-084] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Order Approving Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to Amendments to the Rule Regarding Supervisory Control Systems, Rule 3012, To Require Notification of Reliance on “Limited Size and Resources” Exception November 18, 2005. I. Introduction On June 23, 2005, the National Association of Securities Dealers, Inc. (“NASD”) filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 a proposed rule change amending the rule regarding supervisory control systems, Rule 3012, to require members relying on the “limited size and resources” exception to Rule 3012's general supervisory requirement for conducting producing managers' supervisory reviews to report electronically to NASD their reliance on the exception. On July 8, 2005, NASD submitted Amendment No. 1 to the proposed rule change. 3 On July 27, 2005, NASD submitted Amendment No. 2. 4 The proposed rule change, as amended, was published for comment in the **Federal Register** on August 9, 2005. 5 The Commission received one comment on the proposal. For the reasons discussed below, the Commission is approving the proposed rule change, as amended. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 Amendment No. 1 clarified the rule's text. 4 Amendment No. 2 replaced and superseded Amendment No. 1. Amendment No. 2 further clarified the rule's text. 5 *See* Exchange Act Release No. 52195 (Aug. 3, 2005), 70 FR 46242 (Aug. 9, 2005) (the “Notice”). II. Description of the Proposed Rule Change A. Description of the Proposal Rule 3012 (Supervisory Control System) requires members to have a system of supervisory control policies and procedures that tests and verifies that a member's supervisory procedures are reasonably designed with respect to the activities of the member and its registered representatives and associated persons to achieve compliance with applicable securities laws and regulations, and with applicable NASD rules, and to amend those supervisory procedures when the testing and verification demonstrate a need to do so. Rule 3012 also requires that a member's supervisory control policies and procedures include, among other things, procedures that are reasonably designed to review and supervise the customer account activity conducted by a member's producing managers. Generally, only a person senior to or “otherwise independent” of a producing manager may conduct the producing manager's reviews. However, Rule 3012 provides a limited exception for any member firm that is so limited in size and resources (the “limited size and resources” exception) that the member does not have independent associated persons who can conduct the required supervisory reviews. In such situations, a principal who is sufficiently knowledgeable of the member's supervisory control procedures may conduct the required supervisory reviews. In its Order approving Rule 3012, the SEC specified that NASD must notify the SEC of those members that elect to rely on Rule 3012's “limited size and resources” exception. 6 To fulfill this obligation, NASD will need to identify those members relying on the exception. Accordingly, NASD is filing this rule change requiring firms that rely on the “limited size and resources” exception to notify NASD of their reliance on the exception. In *Notice to Members 04-71* (October 2004), the *Notice* announcing the SEC's approval of the Supervisory Control Amendments, NASD advised its members of its intent to file this rule change. 6 *See* Exchange Act Release No. 50477 (Sept. 30, 2004), 69 FR 59972 (Oct. 6, 2004) (SR-NASD-2004-116). The proposed rule change will require a member that has determined that it must rely on the “limited size and resources” exception to Rule 3012 to conduct any of its producing managers' supervisory reviews, to notify NASD electronically (or through any other process prescribed by NASD) within thirty
(30)days of the date on which the member first relies on the exception. 7 Afterwards, the member will need to notify NASD of its continued reliance on the exception on an annual basis. Members must ensure that each ensuing annual notification is effected no later than on the anniversary date of the previous year's notification. If a member determines that it no longer needs to rely on the “limited size and resources” exception to Rule 3012 to conduct any of its producing managers' supervisory reviews, the member must notify NASD electronically (or through any other process prescribed by NASD) within thirty
(30)days of ceasing to rely on the exception. 7 Because the “limited size and resources” exception became effective on January 31, 2005, a member may already be relying on the exception prior to the effective date of the proposed rule change and, consequently, will be unable to comply with the rule change's requirement that NASD be notified within thirty
(30)days of the date on which the member first relies on the exception. In such instance, the proposed rule change would require the member to notify NASD within thirty
(30)days of the rule change's effective date. NASD has recently designed an electronic reporting system that will enable members to notify NASD of their reliance on the exception. Members will be able to access this reporting system on the effective date of this proposed rule change. NASD will announce the effective date of the proposed rule change in a *Notice to Members* to be published no later than 60 days following Commission approval. The effective date will be 30 days following publication of the *Notice to Members* announcing Commission approval. B. Comment Summary The proposal was published for comment in the **Federal Register** on August 9, 2005. 8 We received one comment on the proposal. The commenter, Lincoln Investment Planning, Inc. (“Lincoln”), expressed concern that the proposed annual notification requirement for members that rely on Rule 3012's “Limited Size and Resources” exception would impose an undue burden on members to remember the anniversary date of the initial notification. 9 Instead, Lincoln stated that this burden could be reduced by requiring members relying on this exception to only provide an initial notification of their reliance and a second notification when they cease to rely on it. Alternatively, Lincoln also suggested that NASD consider making the notification requirement a part of the quarterly updated NASD Control System. 10 8 *See* Notice, *supra* note 3. 9 *See* e-mail to *rule-comments@sec.gov* from Deidre B. Koerick, Lincoln Investment Planning, Inc., dated Aug. 30, 2005. 10 *Id.* In response to the Lincoln letter, NASD stated that “[t]he annual notification requirement helps NASD to provide the SEC with the most accurate information possible. To aid members in completing their annual notification requirement, the electronic reporting system that NASD has designed for members to use, records and displays the date of the member's previous notification.” 11 Furthermore, to mitigate any concerns regarding a member's obligation to remember the anniversary date of its reliance of the exception, NASD stated that it “expects to provide members with reminders, electronic or otherwise, in advance of the members' anniversary date for notification of continued reliance on the exception.” 12 11 *See* letter from Patricia M. Albrecht, Assistant General Counsel, NASD, to Katherine A. England, Assistant Director, Division of Market Regulation, Commission, dated Oct. 4, 2005. 12 *Id.* III. Discussion and Findings After careful review, the Commission finds that the proposed rule change, as amended, is consistent with the provisions of Section 15A(b)(6) 13 of the Act, which require, among other things, NASD's rules to be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. 13 15 U.S.C. 78o-3(b)(6). Rule 3012 requires independent supervisory reviews of producing managers. It is designed to prevent fraudulent and manipulative practices and to protect investors. In approving the rule, the Commission said it expected that Rule 3012 will reduce potential conflicts of interests in situations where the producing branch manager is responsible for generating substantial revenues for the benefit of his supervisor. The Commission believes that such heightened supervisory procedures should help address the potential conflicts of interest with sufficient flexibility so as not to create undue burdens and costs on members. 14 14 *See* Exchange Act Release No 49883 (June 17, 2004). The rule recognizes, however, that certain firms may conduct their business with significant limitation in size and resources, and accounted for this limitation by approving a “Limited Size and Resources” exception. The Commission concluded that the “Limited Size and Resources” exception was consistent with Section 15A(b)(6) because it accommodated the smallest NASD members that lack the resources to implement a full scale program to conduct supervisory reviews. 15 However, in approving this exception, the Commission expected NASD to monitor closely the use of this exception to prevent its abuse or use by members other than those for which it was intended. 16 15 *See* Exchange Act Release No. 50477 (Sept. 30, 2004). 16 *Id.* NASD proposed this amendment to Rule 3012 to provide an efficient measure for monitoring the use of the exception. The Commission believes that this proposed rule change, as amended, accomplishes the goals of Section 15(A)(b)(6) by enabling NASD and the Commission to efficiently monitor members that rely on the “Limited Size and Resources” exception in Rule 3012. IV. Conclusion *It is therefore ordered,* pursuant to Section 19(b)(2) of the Act 17 that the proposed rule change, as amended (SR-NASD-2005-084), be, and hereby is, approved. 17 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 18 18 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6627 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52816; File No. SR-NYSE-2005-70] Self-Regulatory Organizations; New York Stock Exchange, Inc.; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change Relating to iShares ® MSCI Index Funds November 21, 2005. 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 October 6, 2005, the New York Stock Exchange, Inc. (“NYSE” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons and is approving the proposal on an accelerated basis. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to list and trade the following iShares ® Index Funds, which are Investment Company Units (“ICUs”) under section 703.16 of the Exchange Listed Company Manual: iShares MSCI SM Belgium Index Fund, iShares MSCI France Index Fund, iShares MSCI Italy Index Fund, iShares MSCI Netherlands Index Fund, iShares MSCI Spain Index Fund, iShares MSCI Sweden Index Fund, and iShares MSCI Switzerland Index Fund. 3 3 MSCI and MSCI Indices are registered service marks of Morgan Stanley & Co., Incorporated. 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 III 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 Exchange has adopted listing standards applicable to ICUs, which are consistent with the listing criteria currently used by other exchanges, and trading standards pursuant to which the Exchange may trade ICUs on the Exchange, including on an unlisted trading privileges (“UTP”) basis. 4 The Exchange now proposes to list the following iShares Index Funds (“Funds”), which are ICUs under section 703.16 of the Exchange Listed Company Manual: iShares MSCI SM Belgium Index Fund, iShares MSCI France Index Fund, iShares MSCI Italy Index Fund, iShares MSCI Netherlands Index Fund, iShares MSCI Spain Index Fund, iShares MSCI Sweden Index Fund, and iShares MSCI Switzerland Index Fund. 5 4 In 1996, the Commission approved Section 703.16 of the Exchange Listed Company Manual (the “Manual”), which sets forth the rules related to the listing of ICUs. *See* Securities Exchange Act Release No. 36923 (March 5, 1996), 61 FR 10410 (March 13, 1996) (SR-NYSE-95-23). In 2000, the Commission also approved the Exchange's “generic” listing standards pursuant to Rule 19b-4(e) of the Act for the listing and trading, or the trading pursuant to UTP, of ICUs under Section 703.16 of the Manual and Exchange Rule 1100. *See* Securities Exchange Act Release No. 43679 (December 5, 2000), 65 FR 77949 (December 13, 2000) (SR-NYSE-00-46). 5 iShares, Inc. is registered under the Investment Company Act of 1940 (15 U.S.C. 80a) (the “Investment Company Act”). The current registration statement for iShares, Inc. (the “Registration Statement”) was filed with the Commission on Form N-1A on December 29, 2004. Telephone conversation between David Hsu, Special Counsel, Division of Market Regulation (“Division”), Commission, and Michael Cavalier, Assistant General Counsel, NYSE, on October 20, 2005. The Funds are currently listed and traded on the American Stock Exchange (“Amex”) 6 and the issuer of the Funds, iShares, Inc., intends to move the listing of the Funds to the NYSE. The Funds also trade on other securities exchanges 7 and in the over-the-counter market. The Exchange stated that the information below is intended to provide a description of how the Funds were created and are traded. 8 6 The Funds were formerly known as World Equity Benchmark Shares or WEBS, and an initial series of WEBS, including the Funds that are the subject of the instant filing were initially approved for listing and trading on the Amex in 1996. *See* Securities Exchange Act Release No. 36947 (March 8, 1996), 61 FR 10606 (March 14, 1996) (SR-Amex-95-43). The Commission has previously approved trading on the NYSE on an UTP basis of the iShares MSCI Japan Index Fund. *See* Securities Exchange Act Release No. 46298 (August 1, 2002), 67 FR 51614 (August 8, 2002) (SR-NYSE-2002-27). The Commission also has approved trading on the NYSE of the following iShares Funds on a UTP basis: iShares MSCI EAFE; iShares S&P Europe 350; iShares MSCI Taiwan; iShares MSCI Pacific ex-Japan; iShares MSCI Brazil; iShares MSCI United Kingdom; iShares MSCI South Korea; iShares MSCI Singapore; iShares MSCI Germany; iShares MSCI Australia; iShares MSCI Mexico; iShares MSCI Hong Kong; iShares MSCI South Africa; iShares MSCI Emerging Markets Free; and iShares MSCI Malaysia. *See* Securities Exchange Act Release No. 50142 (August 3, 2004), 69 FR 48539 (August 10, 2004) (SR-NYSE-2004-27). 7 *See, e.g.* , Securities Exchange Act Release No. 39117 (September 22, 1997), 62 FR 50973 (September 29, 1997) (SR-CHX-96-14) (approving the UTP trading of WEBS). 8 Much of the information in this filing was taken from the Prospectus of iShares, Inc., dated January 1, 2005, as revised on September 23, 2005, and the Statement of Additional Information (“SAI”) of iShares, Inc., dated January 1, 2005, as revised on September 23, 2005, and from the iShares Web site ( *http://www.iShares.com* ). Fund information relating to the net asset value (“NAV”), returns, dividends, component stock holdings and other information is updated on a daily basis on the iShares Web site. The shares of the Funds are issued by iShares, Inc., an open-ended management investment company. Barclays Global Fund Advisors (“BGFA”), a subsidiary of Barclays Global Investors, N.A. (“BGI”), is the investment advisor (“Advisor”) for each Fund. 9 BGI is a wholly owned indirect subsidiary of Barclays Bank PLC of the United Kingdom. BGFA and its affiliates are not affiliated with the index provider (MSCI). Investors Bank and Trust Company (“IBT”) serves as administrator, custodian, and transfer agent for the Funds, and SEI Investments Distribution Co. is distributor for the Funds. The distributor is not affiliated with the Exchange or BGFA. 9 While the Advisor would manage the Funds, the Funds' Board of Directors would have overall responsibility for the Funds' operations. The composition of the Board is, and would be, in compliance with the requirements of section 10 of the Investment Company Act (15 U.S.C. 80a-10). The Funds are subject to and must comply with section 303A.06 of the Manual, which requires that the Funds have an audit committee that complies with Commission Rule 10A-3. The underlying indexes are compiled by Morgan Stanley Capital International (“MSCI”). MSCI is a partially-owned subsidiary of Morgan Stanley. MSCI and Morgan Stanley do not share any employees that are directly involved in the index compilation. MSCI employees directly involved in the index compilation do not report directly to any Morgan Stanley personnel. MSCI has established policies and procedures for the handling and monitoring the dissemination of confidential, non-public information relating to the MSCI indices. These policies and procedures include specific “firewall” procedures regulating the flow of information between MSCI and Morgan Stanley personnel. BGI and its affiliates have no involvement in selection of component stocks in the underlying indexes. Operation of the Fund Each Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the applicable underlying index (“Underlying Index”). Each Fund intends to qualify as a Regulated Investment Company (“RIC”) under the Internal Revenue Code (the “Code”). The Funds utilize representative sampling to invest in a representative sample of securities in the applicable underlying index. Each Fund seeks to achieve its objective by investing primarily in securities issued by companies that comprise the relevant Underlying Index. Each Fund operates as an index fund and will not be actively managed. Adverse performance of a security in a Fund's portfolio will ordinarily not result in the elimination of the security from a Fund's portfolio. Each Fund engages in representative sampling, which is investing in a representative sample of securities in the Underlying Index, selected by BGFA to have a similar investment profile as the Underlying Index. Securities selected have aggregate investment characteristics (based on market capitalization and industry weightings), fundamental characteristics (such as return variability, earnings valuation, and yield) and liquidity measures similar to those of the relevant Underlying Index. Funds that use representative sampling generally do not hold all of the securities that are included in the relevant underlying index. From time to time, adjustments may be made in the portfolio of a Fund in accordance with changes in the composition of the underlying index or to maintain compliance with requirements applicable to a RIC under the Code. 10 For example, if at the end of a calendar quarter a Fund would not comply with the RIC diversification tests, the Advisor would make adjustments to the portfolio to ensure continued RIC status. 10 In order for the Fund to qualify for tax treatment as a RIC, it must meet several requirements under the Code. Among these is a requirement that, at the close of each quarter of the Fund's taxable year,
(1)at least 50% of the market value of the Fund's total assets must be represented by cash items, U.S. government securities, securities of other RICs and other securities, with such other securities limited for the purpose of this calculation with respect to any one issuer to an amount not greater than 5% of the value of the Fund's assets and not greater than 10% of the outstanding voting securities of such issuer; and
(2)not more than 25% of the value of its total assets may be invested in securities of any one issuer, or two or more issuers that are controlled by the Fund (within the meaning of section 851(b)(4)(B) of the Code) and that are engaged in the same or similar trades or business (other than U.S. government securities of other RICs). The iShares MSCI France Fund will at all times invest at least 90% of its assets in the securities of the Underlying Index and ADRs representing the component securities in the Underlying Index. Each of the iShares Belgium, Italy, Netherlands, Spain, Sweden, and Switzerland Funds will at all times invest at least 80% of its assets in securities of the applicable Underlying Index and ADRs based on the component securities of its Underlying Index, and at least 90% of its assets in the securities and ADRs based on such securities of its Underlying Index or in securities or ADRs included in the relevant market, but not in its Underlying Index. 11 Therefore, each of the Funds will invest not more than 10% of fund assets in ADRs and other securities, 12 which are not included in or based on the component securities of its Underlying Index and are also not included in the relevant market. Each of the ADRs in which these Funds will invest shall be listed on a national securities exchange or the Nasdaq Stock Market. 11 Telephone conversation between Florence Harmon, Senior Special Counsel, Division, and Michael Cavalier, Assistant General Counsel, NYSE, on November 15, 2005. 12 *Id.* Index Descriptions and Methodology *Weighting.* According to the Funds' SAI effective May 31, 2002, all single-country MSCI Indices are free float weighted, *i.e.* , companies are included in the indices at the value of their free public float (free float, multiplied by price). MSCI defines “free float” as total shares excluding shares held by strategic investors such as governments, corporations, controlling shareholders and management, and shares subject to foreign ownership restrictions. In other words, the free float of a security is the proportion of shares outstanding that are deemed to be available for purchase in the public equity markets by international investors. In practice, limitations on free float available to international investors include:
(i)Strategic and other shareholdings not considered part of available free float; and
(ii)limits on share ownership for foreigners. Under MSCI's free float-adjustment methodology, a constituent “Inclusion Factor” is equal to its estimated free float rounded-up to the closest 5% for constituents with free float equal to or exceeding 15%. For example, a constituent security with a free float of 23.2% will be included in the index at 25% of its market capitalization. For securities with a free float of less than 15% that are included on an exceptional basis, the estimated free float is adjusted to the nearest 1%. MSCI's standard equity indices generally seek to have 85% of the free float-adjusted market capitalization of a country's stock market reflected in the MSCI Index for such country. Market capitalization weighting, combined with a consistent target of 85% of free float-adjusted market capitalization, helps ensure that each country's weight in regional and international indices approximates its weight in the total universe of developing and emerging markets. *Selection Criteria.* MSCI undertakes an index construction process, which involves:
(i)Defining the equity universe;
(ii)adjusting the total market capitalization of all securities in the universe for free float available to foreign investors;
(iii)classifying the universe of securities under the Global Industry Classification Standard (the “GICS”); and
(iv)selecting securities for inclusion according to MSCI's index construction rules and guidelines. The index construction process starts at the country level, with the identification of all listed securities for that country. MSCI classifies each company and its securities in only one country. This allows securities to be sorted distinctly by their respective countries. In general, companies and their respective securities are classified as belonging to the country in which they are incorporated. All listed equity securities, or listed securities that exhibit characteristics of equity securities, except investment trusts, mutual funds and equity derivatives, are eligible for inclusion in the universe. Shares of non-domiciled companies generally are not eligible for inclusion in the universe. After identifying the universe of securities, MSCI calculates the free float-adjusted market capitalization of each security in that universe using publicly available information. The process of free float adjusting market capitalization involves
(i)defining and estimating the free float available to foreign investors for each security, using MSCI's definition of free float;
(ii)assigning a free float-adjustment factor to each security; and
(iii)calculating the free float-adjusted market capitalization of each security. *Classifying Securities Under the GICS* . In addition to the free float-adjustment of market capitalization, all securities in the universe are assigned to an industry-based hierarchy that describes their business activities. To this end, MSCI has designed, in conjunction with Standard & Poor's, the GICS. This comprehensive classification scheme provides a universal approach to industries worldwide and forms the basis for achieving MSCI's objective of reflecting broad and fair industry representation in its indices. *Selecting Securities for Index Inclusion* . In an attempt to ensure a broad and fair representation in the indices of the diversity of business activities in the universe, MSCI follows a “bottom-up” approach to index construction, building indices up to the industry group level. The bottom-up approach to index construction requires a thorough analysis and understanding of the characteristics of the universe. This analysis drives the individual security selection decisions, which aim to reflect the overall features of the universe in the country index. MSCI targets an 85% free float-adjusted market representation level within each industry group, within each country. The security selection process within each industry group is based on the careful analysis of:
(i)Each company's business activities and the diversification that its securities would bring to the index;
(ii)the size (based on free float-adjusted market capitalization) and liquidity of securities; 13
(iii)the estimated free float for the company and its individual share classes. Only securities of companies with estimated free float greater than 15% are, in general, considered for inclusion. Exceptions to this general rule are made only in significant cases, where not including a security of a large company would compromise the index's ability to fully and fairly represent the characteristics of the underlying market. 13 All else being equal, MSCI targets for inclusion the most sizable and liquid securities in an industry group. In addition, securities that do not meet the minimum size guidelines discussed below and/or securities with inadequate liquidity are not considered for inclusion. *Exchange Rates.* The prices used to calculate the MSCI Indices are the official exchange closing prices or those figure accepted as such. MSCI reserves the right to use an alternative pricing source on any given day. For the MSCI Indices, MSCI uses the foreign currency exchange rates published by WM Reuters at 4 p.m. London time. MSCI uses WM Reuters rates for all developed and emerging markets. Exchange rates are taken daily at 4 p.m. London time by the WM Company and are sourced whenever possible from multi-contributor quotes on Reuters. Representative currency exchange rates are selected for each currency based on a number of “snapshots” of the latest contributed quotations taken from the Reuters service at short intervals around 4 p.m. London time. WM Reuters provides closing bid and offer rates. MSCI uses these to calculate the mid-point to five decimal places. MSCI continues to monitor currency exchange rates independently and may, under exceptional circumstances, elect to use an alternative currency exchange rate if the WM Reuters rate is believed not to be representative for a given currency on a particular day. *Changes to the Indices.* According to the Registration Statement, the MSCI Indices are maintained with the objective of reflecting, on a timely basis, the evolution of the underlying equity markets. In maintaining the MSCI Indices, emphasis is also placed on continuity, replicability, and minimizing turnover in the Indices. Maintaining the MSCI Indices involves many aspects, including additions to and deletions from the Indices and changes in number of shares and changes in Foreign Inclusion Factors (“FIFs”) as a result of updated free float estimates. Potential additions are analyzed not only with respect to their industry group, but also with respect to their industry or sub-industry group, in order to represent a wide range of economic and business activities. All additions are considered in the context of MSCI's methodology, including the index constituent eligibility rules and guidelines. In assessing deletions, it is important to emphasize that indices must represent the full-investment cycle, including bull as well as bear markets. Out-of-favor industries and their securities may exhibit declining prices, declining market capitalization, and/or declining liquidity, and yet are not deleted because they continue to be good representatives of their industry group. As a general policy, changes in number of shares are coordinated with changes in FIFs to accurately reflect the investability of the underlying securities. In addition, MSCI continuously strives to improve the quality of its free float estimates and the related FIFs. Additional shareholder information may come from better disclosure by companies or more stringent disclosure requirements by a country's authorities. It may also come from MSCI's ongoing examination of new information sources for the purpose of further enhancing free float estimates and better understanding shareholder structures. When MSCI identifies useful additional sources of information, it seeks to incorporate them into its free float analysis. Overall, index maintenance can be described by three broad categories of implementation of changes: • Annual full country index reviews that systematically re-assess the various dimensions of the equity universe for all countries and are conducted on a fixed annual timetable; • Quarterly index reviews, aimed at promptly reflecting other significant market events; and • Ongoing event-related changes, such as mergers and acquisitions, which are generally implemented in the indices rapidly as they occur. Potential changes in the status of countries (stand-alone, emerging, developed) follow their own separate timetables. These changes are normally implemented in one or more phases at the regular annual full country index review and quarterly index review dates. The annual full country index review for all the MSCI Standard Country Indices is carried out once every 12 months and implemented as of the close of the last business day of May. The implementation of changes resulting from a quarterly index review occurs on only three dates throughout the year, as of the close of the last business day of February, August, and November. Any country indices may be impacted at the quarterly index review. MSCI Index additions and deletions due to quarterly index rebalancings are announced at least two weeks in advance. *Index Holdings as of May 31, 2005.* As of May 31, 2005, the iShares MSCI Belgium Index's top three holdings were Fortis, KBC Groupe, and Dexia. The Index's top three industries were Financials, Consumer Staples, and Utilities. The Index components had a total market capitalization of approximately $120.2 billion. The average total market capitalization was approximately $5.7 billion. The ten largest constituents represented approximately 87% of the Index weight. The five highest weighted stocks, which represented 66% of the Index weight, had an average daily trading volume in excess of 7.3 million shares during the past two months. All of the component stocks traded at least 55,000 shares in each of the previous six months. As of May 31, 2005, the iShares MSCI France Index's top three holdings were Total, Sanofi-Aventis, and BNP Paribas. The Index's top three industries were Financials, Energy, and Consumer Discretionary. The Index components had a total market capitalization of approximately $829.2 billion. The average total market capitalization was approximately $39.5 billion. The ten largest constituents represented approximately 58% of the Index weight. The five highest weighted stocks, which represented 42% of the Index weight, had an average daily trading volume in excess of 52.3 million shares during the past two months. All of the component stocks traded at least 475,000 shares in each of the previous six months. As of May 31, 2005, the iShares MSCI Italy Index's top three holdings were ENI, ENEL, and Assicurazioni Generali. The Index's top three industries were Financials, Energy, and Telecommunication Services. The Index components had a total market capitalization of approximately $348.8 billion. The average total market capitalization was approximately $16.6 billion. The ten largest constituents represented approximately 69% of the index weight. The five highest weighted stocks, which represented 51% of the Index weight, had an average daily trading volume in excess of 512.2 million shares during the past two months. All of the component stocks traded at least four million shares in each of the previous six months. As of May 31, 2005, the iShares MSCI Netherlands Index's top three holdings were Royal Dutch Petroleum Co., ING Groep, and ABN AMRO Holding. The Index's top three industries were Energy, Financials, and Consumer Staples. The Index components had a total market capitalization of approximately $419.4 billion. The average total market capitalization was approximately $20.0 billion. The ten largest constituents represented approximately 84% of the index weight. The five highest weighted stocks, which represented 68% of the Index weight, had an average daily trading volume in excess of 66.3 million shares during the past two months. All of the component stocks traded at least 950,000 shares in each of the previous six months. As of May 31, 2005, the iShares MSCI Spain Index's top three holdings were the Telefonica, BSCH BCO Santander Centr, and BBVA. Index's top three industries were Financials, Telecommunication Services, and Utilities. The Index components had a total market capitalization of approximately $345.4 billion. The average total market capitalization was approximately $16.4 billion. The ten largest constituents represented approximately 85% of the index weight. The five highest weighted stocks, which represented 69% of the Index weight, had an average daily trading volume in excess of 283.6 million shares during the past two months. All of the component stocks traded at least 2.1 million shares in each of the previous six months. As of May 31, 2005, the iShares MSCI Sweden Index's top three holdings were Ericsson
(LM)B, Nordea Bank, and Hennes & Mauritz B. The Index's top three industries were Industrials, Financials, and Information Technology. The Index components had a total market capitalization of approximately $215.0 billion. The average total market capitalization was approximately $10.2 billion. The ten largest constituents represented approximately 61% of the index weight. The five highest weighted stocks, which represented 48% of the Index weight, had an average daily trading volume in excess of 312.9 million shares during the past two months. All of the component stocks traded at least 750,000 shares in each of the previous six months. As of May 31, 2005, the iShares MSCI Switzerland Index's top three holdings were Novartis, Nestle, and Roche Holding Genuss. The Index's top three industries were Health Care, Financials, and Consumer Staples. The Index components had a total market capitalization of approximately $602.3 billion. The average total market capitalization was approximately $28.7 billion. The ten largest constituents represented approximately 87% of the Index weight. The five highest weighted stocks, which represented 73% of the Index weight, had an average daily trading volume in excess of 41.4 million shares during the past two months. All of the component stocks traded at least 100,000 shares in each of the previous six months. Correlation According to the Funds' prospectus, BGFA expects that over time, the correlation between each Fund's performance and that of its underlying index, before fees and expenses, will be 95% or better. A figure of 100% would indicate perfect correlation. Any correlation of less than 100% is called “tracking error.” A fund using a representative sampling strategy (which all of the Funds utilize) can be expected to have a greater tracking error than a fund using a replication strategy. Replication is a strategy in which a fund invests in substantially all of the securities in its underlying index in approximately the same proportions as in the underlying index. The Funds have chosen to pursue a representative sampling strategy that, by its very nature, entails some risk of tracking error. (It should also be noted that Fund expenses, the timing of cash flows, and other factors all contribute to tracking error.) The Web site for the Funds, *http://www.iShares.com,* contains detailed information on the performance and the tracking error for each Fund. 14 14 The price at which the Funds' shares trade should be disciplined by arbitrage opportunities created by the ability to purchase or redeem shares of the Funds in Creation Unit (defined below) aggregations throughout the trading day. This should help ensure that the Funds' shares will not trade at a material discount or premium to their net asset value or redemption value. The Funds investment objectives, policies, and investment strategies will be fully disclosed in the prospectus. 15 The Funds' Board of Directors will review the tracking error of the Funds on a quarterly basis and based its review will consider whether any action may be appropriate. 16 15 Telephone conversation between David Hsu, Special Counsel, Division, and Michael Cavalier, Assistant General Counsel, NYSE, on October 20, 2005. 16 *Id.* Industry Concentration Policy As disclosed in the Funds' prospectus, each of the Underlying Indexes for the Funds will not concentrate its investments ( *i.e.* , hold 25% or more of its total assets in the stocks of a particular industry or group of industries), except that, to the extent practicable, each Fund will concentrate to approximately the same extent that its underlying index concentrates in the stocks of such particular industry or group of industries. Each Fund intends to maintain regulated investment company compliance, which requires, among other things, that, at the close of each quarter of the Fund's taxable year, not more than 25% of its total assets may be invested in the securities of any one issuer. The Exchange believes that these requirements and policies prevent any Fund from being excessively weighted in any single security or small group of securities and significantly reduce concerns that trading in an Index Fund could become a surrogate for trading in a single or a few unregistered securities. Issuance of Creation Units iShares, Inc. will issue and redeem the shares of the Funds only in aggregations (each aggregation a “Creation Unit”) of substantial size, which varies for the various Funds. The size of a Creation Unit for each Fund and estimated value of a Creation Unit for each Fund as of September 28, 2005 is as follows. 17 17 As noted, the MSCI Index methodology generally seeks to have represented 85% of the free float-adjusted market capitalization of a country's stock market or regional market, which also makes it unlikely that the Funds will become a surrogate for trading a single or a few unregistered stocks. Electronic mail exchange between Florence Harmon, Senior Special Counsel, Division, John Carey, Assistant General Counsel, NYSE, on November 9, 2005. Shares per creation unit Price per share Est. value per creation unit iShares MSCI Belgium 40,000 $19.17 $766,800 iShares MSCI France 200,000 26.12 5,224,000 iShares MSCI Italy 150,000 26.38 3,957,000 iShares MSCI Netherlands 50,000 19.15 957,500 iShares MSCI Spain 75,000 37.50 2,812,500 iShares MSCI Sweden 75,000 22.10 1,657,500 iShares MSCI Switzerland 125,000 18.07 2,258,750 The number of shares of each Fund outstanding as of September 28, 2005 was 2.48 million (Belgium); 3.20 million (France); 1.65 million (Italy); 3.35 million (Netherlands); 1.88 million (Spain); 2.93 million (Sweden); and 4.50 million (Switzerland). These numbers exceed the minimum number of shares to be issued in connection with initial listing of the Funds on the Amex in 1996. 18 A minimum of two Creation Units of the Funds were required to be outstanding at the time of initial listing on the Amex. 18 *See* Securities Exchange Act Release No. 36947 (March 8, 1996) 61 FR 10606 (March 14, 1996) (SR-Amex-95-43). These number of shares outstanding also exceeds the 100,000 minimum number of shares required to be outstanding in connection with listing of ICUs Investment Company Units under Rule 19b-4(e) under the Act pursuant to the Exchange's generic listing standards in Section 703.16 of the Manual. In addition, the Exchange has required a minimum number of 100,000 shares of ICUs to be outstanding in connection with initial listing of iShares FTSE/Xinhua China 25 Index Fund, which the Commission noted is comparable to requirements previously applied to listed series of ICUs. 19 19 *See* Securities Exchange Act Release No. 50505 (October 8, 2004), 69 FR 61280 (October 15, 2004) (SR-NYSE-2004-55), note 51. The consideration for purchase of a Creation Unit of shares of a Fund generally consists of the in-kind deposit of a designated portfolio of equity securities (the “Deposit Securities”) constituting an optimized representation of the Fund's benchmark foreign securities index and an amount of cash computed as described below (the “Cash Component”). Together, the Deposit Securities and the Cash Component constitute the “Portfolio Deposit,” which represents the minimum initial and subsequent investment amount for shares of a Fund. The Cash Component is an amount equal to the Dividend Equivalent Payment (as defined below), plus or minus, as the case may be, a Balancing Amount (as defined below). The deposit of the requisite Deposit Securities and the Balancing Amount are collectively referred to herein as a “Fund Deposit.” The “Dividend Equivalent Payment” enables iShares, Inc. to make a complete distribution of dividends on the next dividend payment date, and is an amount equal, on a per Creation Unit basis, to the dividends on all the Securities held by the relevant Fund with ex-dividend dates within the accumulation period for such distribution (the “Accumulation Period”), net of expenses and liabilities for such period, as if all of the Portfolio Securities had been held by iShares, Inc. for the entire Accumulation Period. The “Balancing Amount” is an amount equal to the difference between
(x)the NAV (per Creation Unit) of the Fund and
(y)the sum of
(i)the Dividend Equivalent Payment and
(ii)the market value (per Creation Unit) of the securities deposited with iShares, Inc. (the sum of
(i)and
(ii)is referred to as the “Deposit Amount”). The Balancing Amount serves the function of compensating for any differences between the net asset value per Creation Unit and the Deposit Amount. BGFA makes available through the National Securities Clearing Corporation (“NSCC”) on each Business Day, prior to the opening of business on the NYSE (currently 9:30 a.m., Eastern time), 20 the list of the names and the required number of shares of each Deposit Security to be included in the current Portfolio Deposit (based on information at the end of the previous Business Day) for each Fund. Such Portfolio Deposit is applicable, subject to any adjustments as described below, in order to effect purchases of Creation Units of iShares of a given Fund until such time as the next announced Portfolio Deposit composition is made available. 20 Usually, NSCC disseminates the estimated Portfolio Securities and Cash Amount (see below) between 6 p.m. and 8 p.m. (Eastern time) on the prior business day for both creation and redemption requests placed the following day. Telephone conversation between Florence Harmon, Senior Special Counsel, Division, and Michael Cavalier, Assistant General Counsel, NYSE, on November 20, 2005. The identity and number of shares of the Deposit Securities required for a Portfolio Deposit for each Fund changes as rebalancing adjustments and corporate action events are reflected from time to time by BGFA with a view to the investment objective of the Fund. The composition of the Deposit Securities may also change in response to adjustments to the weighting or composition of the securities constituting the relevant securities index. In addition, iShares, Inc. reserves the right to permit or require the substitution of an amount of cash ( *i.e.* , a “cash in lieu” amount) to be added to the Cash Component to replace any Deposit Security which may not be available in sufficient quantity for delivery or for other similar reasons. The adjustments described above will reflect changes, known to BGFA on the date of announcement to be in effect by the time of delivery of the Portfolio Deposit, in the composition of the subject index being tracked by the relevant Fund, or resulting from stock splits and other corporate actions. Thus, in addition to the list of names and numbers of securities constituting the current Deposit Securities of a Portfolio Deposit, on each Business Day prior to the opening of the market, NSCC will make available the estimated Cash Component effective through and including the previous Business Day, per outstanding iShares of each Fund. Creation Units of shares may be purchased only by or through a Depository Trust Company (“DTC”) Participant that has entered into an Authorized Participant agreement with the Distributor (“Authorized Participant”). Authorized Participants must submit an irrevocable Creation Unit request before 4 p.m. (Eastern time) on any business day in order to receive that business day's NAV (and applicable Cash Component). Such Authorized Participant will agree pursuant to the terms of such Authorized Participant Agreement on behalf of itself or any investor on whose behalf it will act, as the case may be, to certain conditions, including that such Authorized Participant will make available in advance of each purchase of iShares an amount of cash sufficient to pay the Cash Component, once the net asset value of a Creation Unit is next determined after receipt of the purchase order in proper form, together with the transaction fee. A purchase transaction fee payable to iShares, Inc. is imposed to compensate iShares, Inc. for the transfer and other transaction costs of a Fund associated with the issuance of Creation Units. The fee ranges from $700 to $2,900 for the Funds. Redemption of Creation Units Shares of a Fund may be redeemed only in Creation Units at their net asset value, NAV, next determined after receipt of a redemption request in proper form by the Distributor. With respect to each Fund, BGFA makes available through the NSCC immediately prior to the opening of business on the NYSE (currently 9:30 a.m., Eastern time) on each business day, the Portfolio Securities that will be applicable (subject to possible amendment or correction) to redemption requests received in proper form on that day. Unless cash redemptions are available or specified for a Fund, the redemption proceeds for a Creation Unit generally consist of Deposit Securities as announced by BGFA through the NSCC on the Business Day of the request for redemption, plus cash in an amount equal to the difference between the NAV of the shares being redeemed, as next determined after a receipt of a request in proper form, and the value of the Deposit Securities, less the redemption transaction fee. The redemption transaction fee is deducted from such redemption proceeds. A redemption transaction fee payable to iShares, Inc. is imposed to offset transfer and other transaction costs that may be incurred by the relevant Fund, including market impact expenses relating to disposing of portfolio securities. This fee ranges from $700 to $2,900 for the Funds. Redemption requests in respect of Creation Units of any Fund must be submitted to the Distributor by or through an Authorized Participant. For most Funds, an Authorized Participant must submit an irrevocable redemption request before 4 p.m. (Eastern time) on any business day in order to receive that business day's NAV (and applicable Cash Component). Owners of iShares may sell them in the secondary market, but, in order to redeem the shares through the Funds, an owner must accumulate enough shares to constitute a creation unit. 21 21 Telephone conversation between David Hsu, Special Counsel, Division, and Michael Cavalier, Assistant General Counsel, NYSE, on October 20, 2005. Availability of Information Regarding iShares and the Underlying Indexes The MSCI Indexes are calculated by MSCI for each trading day in the applicable foreign exchange markets based on official closing prices in such exchange markets. 22 For each trading day, MSCI publicly disseminates the Index values for the previous day's close. The Index values are reported periodically in major financial publications and also are available through vendors of financial information. For all of the Funds, MSCI or third-party major market data vendors now makes available at least every 60 seconds an updated index value for the Indexes when foreign trading market hours overlap with the NYSE trading hours of 9:30 a.m. to 4:15 p.m. Eastern Time. Otherwise, when the foreign market is closed during NYSE trading hours, the Funds provide closing index values on *http://www.ishares.com.* 23 22 As the Commission has previously stated, when a broker-dealer, or a broker-dealer's affiliate such as MSCI, is involved in the development and maintenance of a stock index upon which a product such as iShares is based, the broker-dealer or its affiliate should have procedures designed specifically to address the improper sharing of information. *See* , Securities Exchange Act Release No. 52178, July 29, 2005; 70 FR 46244, August 8, 2005; (SR-NYSE-2005-41). The Exchange notes that MSCI has implemented procedures to prevent the misuse of material, non-public information regarding changes to component stocks in the MSCI Indexes. The Commission has stated that it believes that the information barrier procedures put in place by MSCI address the unauthorized transfer and misuse of material, non-public information. Electronic mail exchange between Florence Harmon, Senior Special Counsel, Division, John Carey, Assistant General Counsel, NYSE, on November 9, 2005. 23 Electronic mail exchange between Florence Harmon, Senior Special Counsel, Division, John Carey, Assistant General Counsel, NYSE, on November 9, 2005. iShares, Inc. will cause to be made available daily the names and required number of shares of each of the securities to be deposited in connection with the issuance of the Funds' shares in Creation Unit size aggregations for the Funds, as well as information relating to the required cash payment representing, in part, the amount of accrued dividends for the Funds. This information will be made available to the Funds' Advisor and to any NSCC participant requesting such information. In addition, other investors can request such information directly from the Funds' distributor. The NAV for the Funds is calculated directly by the Fund administrator
(IBT)once a day, generally at 4 p.m., Eastern Time. 24 The NAV will also be available to the public on *http://www.iShares.com* , from the Fund distributor by means of a toll-free number, and to NSCC participants through data made available from the NSCC. 24 Electronic mail exchange between Florence Harmon, Senior Special Counsel, Division, John Carey, Assistant General Counsel, NYSE, on November 9, 2005. To provide current pricing information for the Funds, there will be disseminated through the facilities of the Consolidated Tape Association (“CTA”) an amount per iShare representing the sum of the estimated Balancing Amount effective through and including the previous business day plus the current value of the Deposit Securities in U.S. Dollars, on a per iShare basis. This amount is referred to herein as the “indicative optimized portfolio value” (the “IOPV”) and will be calculated by an independent third party such as Bloomberg L.P. The IOPV will be disseminated every 15 seconds during regular NYSE trading hours of 9:30 a.m. to 4:15 p.m. (New York time). Because the Funds utilize a representative sampling strategy, the IOPV likely will not reflect the value of all securities included in the applicable indexes. In addition, the IOPV will not necessarily reflect the precise composition of the current portfolio of securities held by the Funds at a particular moment. The IOPV disseminated during NYSE trading hours should not be viewed as a real-time update of the NAV of the Funds, which is calculated only once a day. It is expected, however, that during the trading day the IOPV will closely approximate the value per share of the portfolio of securities for the Funds except under unusual circumstances. For each of the Funds, there is an overlap in trading hours between the foreign and U.S. markets. Therefore, the IOPV calculator will update the applicable IOPV every 15 seconds to reflect price changes in the applicable foreign market or markets, and convert such prices into U.S. dollars based on the currency exchange rate. When the foreign market or markets are closed but U.S. markets are open, the IOPV will be updated every 15 seconds to reflect changes in currency exchange rates after the foreign market closes. The IOPV will also include the applicable cash component for each Fund. There will also be disseminated a variety of data with respect to the Fund on a daily basis by means of CTA and CQ High Speed Lines, which will be made available prior to the opening of trading on the Exchange. Information with respect to recent NAV, shares outstanding, estimated cash amount and total cash amount per Creation Unit Aggregation will be made available prior to the opening of the Exchange. In addition, the Web site for the Funds, which will be publicly accessible at no charge, will contain the following information, on a per iShare basis, for the Funds:
(i)The prior business day's NAV and the mid-point of the bid-ask price at the time of calculation of such NAV (“Bid/Ask Price”) 25 and a calculation of the premium or discount of such price against such NAV; and
(ii)data in chart format displaying the frequency distribution of discounts and premiums of the Bid/Ask Price against the NAV, within appropriate ranges, for each of the four previous calendar quarters. 25 The Bid-Ask Price of the Funds is determined using the highest bid and lowest offer on the Exchange as of the time of calculation of the Funds' NAV. The closing prices of the Funds' Deposit Securities are readily available from, as applicable, the relevant exchanges, automated quotation systems, published or other public sources in the relevant country, or online information services such as Bloomberg or Reuters. The exchange rate information required to convert such information into U.S. dollars is also readily available in newspapers and other publications and from a variety of on-line services. The Exchange believes that dissemination of the IOPV based on the Deposit Securities provides additional information regarding the Funds that is not otherwise available to the public and is useful to professionals and investors in connection with trading shares of the Funds on the Exchange or the creation or redemption of Fund shares. Dividends and Distributions Dividends from net investment income, including any net foreign currency gains, are accrued and declared and paid at least annually and any net realized securities gains are distributed at least annually. In order to improve tracking error or comply with distribution requirements of the Code, dividends may be declared more frequently than annually for certain Funds. The final dividend amount is also disseminated by the Funds to Bloomberg and other sources. The Funds will not make the DTC book-entry Dividend Reinvestment Service (the “Service”) available for use by beneficial owners for reinvestment of their cash proceeds but certain individual brokers may make the Service available to their clients. Beneficial owners of iShares will receive all of the statements, notices, and reports required under the Investment Company Act and other applicable laws. They will receive, for example, annual and semi-annual reports, written statements accompanying dividend payments, proxy statements, annual notifications detailing the tax status of distributions, Internal Revenue Service Form 1099-DIVs, etc. Because iShares Inc.'s records reflect ownership of iShares by DTC only, iShares, Inc. will make available applicable statements, notices, and reports to the DTC Participants who, in turn, will be responsible for distributing them to the beneficial owners. Other Issues *Information Memo* . The Exchange will distribute an Information Memo (“Information Memo”) to its members in connection with the trading of the Funds. The Information Memo will discuss the special characteristics and risks of trading this type of security. Specifically, the Information Memo, among other things, will discuss what the Funds are, how they are created and redeemed, requirements regarding delivery of a prospectus or Product Description by members and member firms to investors purchasing shares of the Fund prior to or concurrently with the confirmation of a transaction, applicable Exchange rules, dissemination information, trading information and the applicability of suitability rules (including NYSE Rule 405). The Information Memo will also discuss exemptive, no-action and interpretive relief granted by the Commission from section 11(d)(1) and certain rules under the Act, including Rule 10a-1, Rule 10b-10, Rule 14e-5, Rule 10b-17, Rule 11d1-2, Rules 15c1-5 and 15c1-6, and Rules 101 and 102 of Regulation M under the Act. *Purchases and Redemptions in Creation Unit Size.* In the Information Memo referenced above, members and member organizations will be informed that procedures for purchases and redemptions of iShares in Creation Unit size are described in the Fund prospectus and SAI, and that iShares are not individually redeemable but are redeemable only in Creation Unit size aggregations or multiples thereof. *Original and Annual Listing Fees.* The original listing fee applicable to each Fund for listing on the Exchange is $5,000, and the continuing fee would be $2,000 for each Fund, paid annually. *Stop and Stop Limit Orders.* Commentary .30 to Exchange Rule 13 provides that stop and stop limit orders in an ICU shall be elected by a quotation, but specifies that if the electing bid or an offer is more than 0.10 points away from the last sale and is for the specialist's dealer account, prior Floor Official approval is required for the election to be effective. This rule applies to ICUs generally. *Exchange Rule 460.10.* Exchange Rule 460.10 generally precludes certain business relationships between an issuer and the specialist (or its affiliate) in the issuer's securities. Exceptions in Exchange Rule 460.10 permit specialists in Fund shares to enter into Creation Unit transactions through the Distributor to facilitate the maintenance of a fair and orderly market. A specialist Creation Unit transaction may only be effected on the same terms and conditions as any other investor, and only based on the net asset value of the Fund shares. A specialist (or its affiliate) may acquire a position in excess of 10% of the outstanding issue of the Fund shares, provided, however, that a specialist registered in a security issued by an investment company may purchase and redeem the investment company unit or securities that can be subdivided or converted into such unit, from the investment company as appropriate to facilitate the maintenance of a fair and orderly market in the subject security. *Trading Hours and Trading Increment.* The trading hours for the Funds on the Exchange will be 9:30 a.m. to 4:15 p.m. The minimum trading increment is $0.01. *Due Diligence/Suitability.* The Exchange represents that the Memo to members will note, for example, Exchange responsibilities including that before an Exchange member, member organization, or employee thereof recommends a transaction in the Funds, a determination must be made that the recommendation is in compliance with all applicable Exchange and Federal rules and regulations, including due diligence obligations under Exchange Rule 405 (Diligence as to Accounts). *Trading Halts.* In order to halt the trading of the Fund, the Exchange may consider, among other things, factors such as the extent to which trading is not occurring in underlying security(s) and whether other unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present. In addition, trading in Fund shares is subject to trading halts caused by extraordinary market volatility pursuant to Exchange Rule 80B. The Exchange will halt trading in a Fund if the Index value or IOPV applicable to such Fund is no longer calculated or disseminated. 26 26 In the event an Index value or IOPV is no longer calculated or disseminated, the Exchange would immediately contact the Commission to discuss appropriate measures that may be appropriate under the circumstances. Telephone conversation between Florence Harmon, Senior Special Counsel, Division, and Michael Cavalier, Assistant General Counsel, NYSE, on November 20, 2005. *Prospectus or Product Description Delivery.* The Commission has granted iShares, Inc. an exemption from certain prospectus delivery requirements under section 24(d) 27 of the Investment Company Act. 28 Any product description used in reliance on a section 24(d) exemptive order will comply with all representations made therein and all conditions thereto. The Exchange, in a information memo to Exchange members and member organizations, will inform members and member organizations, prior to commencement of trading, of the prospectus or product description delivery requirements applicable to the Funds and will refer members and member organizations to Exchange Rule 1100(b). The information memo will also advise members and member organizations that delivery of a prospectus to customers in lieu of a product description would satisfy the requirements of Exchange Rule 1100(b). 27 15 U.S.C. 80a-24(d). 28 *See In the Matter of iShares, Inc.,* *et al.* , Investment Company Act Release No. 25623 (June 25, 2002). Surveillance Procedures The Exchange will utilize its existing surveillance procedures applicable to ICUs to monitor trading in the Funds. The Exchange believes that these procedures are adequate to monitor Exchange trading of the Funds. Exchange surveillance procedures applicable to trading in iShares are comparable to those applicable to other ICUs currently trading on the Exchange. The Exchange's surveillance procedures, which the Exchange has filed with the Commission, are adequate to properly monitor the trading of the Funds. The Exchange's current trading surveillances focus on detecting securities trading outside their normal patterns. When such situations are detected, surveillance analysis follows and investigations are opened, where appropriate, to review the behavior of all relevant parties for all relevant trading violations. The Exchange is able to obtain information regarding trading in both the Fund shares and the component securities through NYSE members in connection with such members' proprietary or customer trades that they effect on any relevant market. In addition, the Exchange may obtain trading information via the Intermarket Surveillance Group (“ISG”) from other exchanges who are members or affiliates of the ISG. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with section 6(b)(5) of the Act 29 requiring that an exchange have rules that are designed, among other things, to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. 29 15 U.S.C. 78f(b)(5). 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 neither solicited nor received written comments on the proposed rule change. III. 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-NYSE-2005-70 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-NYSE-2005-70. 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. 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-NYSE-2005-70 and should be submitted on or before December 20, 2005. IV. Commission Findings The Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder, applicable to a national securities exchange. 30 In particular, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Act 31 and will promote just and equitable principles of trade, and facilitate transactions in securities, and, in general, protect investors and the public interest. The Commission believes that the Exchange's listing standards, trading rules, suitability and disclosure rules for the Funds are consistent with the Act. The Commission also believes that the proposed rule change raises no issues that have not been previously considered by the Commission. The Commission notes that it previously approved the original listing and trading of the Funds on the Amex. 32 Further, with respect to each of the following key issues, the Commission believes that the Funds satisfy established standards. 30 In approving this proposal, the Commission has considered its impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 31 15 U.S.C. 78f(b)(5). 32 *See* Securities Exchange Act Release No. 36947 (March 8, 1996), 61 FR 10606 (March 14, 1996) (SR-Amex-95-43). A. Surveillance The Commission notes that the Underlying Indexes are broad-based and are composed of securities having significant trading volumes and market capitalization, thus impeding improper trading practices in the Shares, the ability to use the Shares to manipulate the underlying securities, and the ability to use the Shares as a surrogate to trade one or a few unregistered securities. Nevertheless, the NYSE represents that its surveillance procedures applicable to trading in the proposed iShares are adequate to properly monitor the trading of the Funds. The Exchange also is able to obtain information regarding trading in both the Fund shares and the Component Securities by its members on any relevant market; in addition, the Exchange may obtain trading information via the ISG from other exchanges who are members or affiliates of the ISG. As stated, when a broker-dealer, or a broker-dealer's affiliate such as MSCI, is involved in the development and maintenance of a stock index upon which a product such as iShares is based, the broker-dealer or its affiliate should have procedures designed specifically to address the improper sharing of information. The Commission notes that the Exchange has represented that MSCI has implemented procedures to prevent the misuse of material, non-public information regarding changes to component stocks in the MSCI Indices. B. Dissemination of Information about the Shares In approving the Funds for listing and trading on the NYSE, the Commission notes that the Underlying Indexes are broad-based indexes. If there is an overlap between the foreign jurisdiction and the NYSE trading hours, these index values are disseminated through various main market data vendors at least every 60 seconds during such overlap in trading hours. Otherwise, the Funds provide the Index closing value at *http://www.iShares.com.* Additionally, the Commission notes that the Exchange will disseminate through the facilities of CTA during NYSE trading hours at least every 15 seconds a calculation of the IOPV (which will reflect price changes in the applicable foreign market and changes in currency exchange rates), along with an updated market value of the Shares. Comparing these two figures will help investors to determine whether, and to what extent, the Shares may be selling at a premium or discount to NAV and thus will facilitate arbitrage of the Shares in relation to the Index component securities. The Commission also notes that the Web site for the Funds *(http://www.iShares.com)* , which is and will be publicly accessible at no charge, will contain the Shares' prior business day NAV, the reported closing price, and a calculation of the premium or discount of such price in relation to the closing NAV. C. Listing and Trading The Commission finds that the Exchange's rules and procedures for the proposed listing and trading of the Funds are consistent with the Act. Shares of the Funds will trade as equity securities subject to NYSE rules including, among others, rules governing trading halts, specialist activities, stop and stop limit orders, prospectus delivery, and customer suitability requirements. In addition, the Funds will be subject to NYSE listing and delisting/halt rules and procedures governing the trading of Index Fund Shares on the Exchange. The Commission believes that listing and delisting criteria for the Shares should help to maintain a minimum level of liquidity and therefore minimize the potential for manipulation of the Shares. Finally, the Commission believes that the Information Memo the Exchange will distribute will inform members and member organizations about the terms, characteristics, and risks in trading the Shares, including suitability and prospectus delivery requirements. D. Accelerated Approval The Commission finds good cause, pursuant to section 19(b)(2) of the Act, 33 for approving the proposed rule change prior to the thirtieth day after the date of publication of notice in the **Federal Register** . The Commission notes that the proposal is consistent with the listing and trading standards in NYSE Rule 703.16 (ICUs), and the Commission has previously approved the listing of these securities on the Amex. 34 In addition, the Commission finds that this proposal is similar to several instruments currently listed and traded on the exchange. 35 Therefore, the Commission does not believe that the proposed rule change raises issues that have not been previously considered by the Commission. 33 15 U.S.C. 78s(b)(2). 34 *See* Securities Exchange Act Release No. 36947 (March 8, 1996), 61 FR 10606 (March 14, 1996) (approving the listing and trading of the ICUs for trading on the Amex). 35 *See, e.g.* , Securities Exchange Act Release No. 52178 (July 29, 2005), 70 FR 46244, (August 9, 2005) (SR-NYSE-2005-41). V. Conclusion *It Is Therefore Ordered,* pursuant to section 19(b)(2) of the Act, 36 that the proposed rule change (SR-NYSE-2005-70), is hereby approved on an accelerated basis. 36 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 37 37 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6626 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52822; File No. SR-NYSE-2005-02] Self-Regulatory Organizations; New York Stock Exchange, Inc.; Order Approving Proposed Rule Change and Amendments Nos. 1, 2 and 3 Thereto and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 4 to the Proposed Rule Change Relating to Exchange Rule 607 November 22, 2005. I. Introduction On January 4, 2005, the New York Stock Exchange, Inc. (“NYSE” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 a proposed rule change amending Exchange Rule 607 concerning the procedures for the appointment of arbitrators to arbitration cases administered by the NYSE. On May 12, 2005, the NYSE filed Amendment No. 1 to the proposed rule change (“Amendment No. 1”). 3 On May 13, 2005, the NYSE filed Amendment No. 2 to the proposed rule change (“Amendment No. 2). 4 On June 16, 2005, the NYSE filed Amendment No. 3 to the proposed rule change (Amendment No. 3). 5 The proposed rule change was published for comment in the **Federal Register** on June 23, 2005. 6 The Commission received four comments on the proposal, as amended. 7 On November 10, 2005, the Exchange filed Amendment No. 4 to the proposed rule change (“Amendment No. 4”), 8 and on November 14, 2005, the Exchange filed a response to the comment letters. 9 This order approves the proposed rule change, as amended by Amendments Nos. 1, 2 and 3, grants accelerated approval to Amendment No. 4 to the proposed rule change, and solicits comments from interested persons on Amendment No. 4. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 Amendment No. 1 was filed and withdrawn by the NYSE on May 12, 2005. 4 *See* Amendment No. 2. Amendment No. 2 supplemented the initial filing. 5 *See* Amendment No. 3. Amendment No. 3 supplemented the initial filing and modified certain statements in Amendment No. 2. 6 *See* Exchange Act Release No. 51863 (June 16, 2005), 70 FR 36451 (June 23, 2005) (the “Notice”). 7 *See* Letters from Robert S. Clemente, Of Counsel, Liddle and Robinson, to Jonathan G. Katz, dated February 3, 2005 and July 7, 2005 (“Clemente Letters”); Letter from Rosemary J. Shockman, President, Public Investors Arbitration Bar Association, to Jonathan G. Katz, dated July 14, 2005 (“Shockman Letter”); and Letter from Richard P. Ryder, President, Securities Arbitration Commentator, Inc. to Jonathan G. Katz, dated July 15, 2005 (“Ryder Letter”). Mr. Clemente filed two letters in response to the filing, the first of which was received after filing of the proposed rule change but before publication in the **Federal Register** . Mr. Clemente submitted a second letter, similar to the first, after the proposed rule change was noticed in the **Federal Register** , and attached the first letter to the second. 8 In Amendment No. 4, which supplemented the original filing, the Exchange amended the proposed rule text to respond to one of the commenters' concerns. 9 *See* letter from Mary Yeager, Assistant Secretary, NYSE, to Katherine A. England, Assistant Director, Division of Market Regulation, Commission, dated Nov. 14, 2005. II. Description of the Proposed Rule Change A. Description of the Proposal The NYSE currently has several methods by which arbitrators are assigned to cases, including the traditional method pursuant to NYSE Rule 607 where NYSE staff appoints arbitrators to cases. a. The Pilot Program On August 1, 2000, the NYSE implemented a two-year pilot program to allow parties, on a voluntary basis, to select arbitrators under three alternative methods (in addition to the traditional method). 10 Upon expiration of the two-year pilot, the NYSE renewed the pilot for an additional two years, ending on July 31, 2004. 11 The pilot was subsequently extended again until January 31, 2005, 12 then July 31, 2005, 13 and ultimately was extended until November 30, 2005. 14 10 The pilot program was implemented originally for a two-year period. Exchange Act Release No. 43214 (August 28, 2000), 65 FR 53247 (September 1, 2000) (SR-NYSE-2000-34). 11 *See* Exchange Act Release No. 46372 (August 16, 2002), 67 FR 54521 (August 22, 2002) (SR-NYSE-2002-30). 12 *See* Exchange Act Release No. 49915 (June 25, 2004), 69 FR 39993 (July 1, 2004). 13 *See* Exchange Act Release No. 51085 (Jan. 27, 2005), 70 FR 5716 (Feb. 3, 2005), corrected at 70 FR 7143 (Feb. 10, 2005). 14 *See* Exchange Act Release No. 52155 (Jul. 28, 2005), 70 FR 44712 (Aug. 3, 2005) (SR-NYSE-2005-52). The first alternative under the pilot program is the Random List Selection method, by which the parties are provided randomly-generated (as described below) lists of public- and securities-classified arbitrators. The parties have ten days to strike and rank the names on the lists. Based on mutual ranking of the lists, the highest-ranking arbitrators are invited to serve on the case. If a panel cannot be chosen from the first list, a second list is generated, with three potential arbitrators for each vacancy, and one peremptory challenge available to each party for each vacancy. Under the pilot program, if vacancies remain after the second list has been processed, arbitrators are then randomly assigned to serve, subject only to challenges for cause. The second alternative method under the pilot program is the Enhanced List Selection method, in which six public- and three securities-classified arbitrators are selected by NYSE staff, based on their qualifications and expertise. The lists are then sent to the parties. The parties have three strikes to use and are required to rank the arbitrators not stricken. Based on mutual ranking of the lists, the highest-ranking arbitrators are invited to serve on the case. Lastly, the pilot program permits parties, pursuant to mutual agreement, to choose arbitrators through any alternative method. Under the pilot program, the parties must all agree to use either the Random List Selection method, the Enhanced List Selection method or an “alternative method.” Absent such agreement, under the pilot program, the traditional method is used. b. The Proposed Rule Change The proposed amendments to Rule 607 retain the traditional method of staff appointment of arbitrators as an option in the event a full panel cannot be appointed under Random List Selection or in the event that the customer or non-member does not elect to use the Random List Selection method. In addition, the proposed rule change modifies and makes permanent the Random List Selection method by specifying the number of arbitrators on each list (ten public arbitrators and five industry arbitrators) and limiting the number of strikes (four against the public arbitrators and two against the industry arbitrators). The proposed rule change also eliminates the second list of arbitrators. According to the NYSE, this will simplify and shorten the appointment process. The proposed rule change also specifies that for simplified arbitrations, the randomly generated list will contain the names of five arbitrators, against which each party will have two strikes. Further, the proposed rule change gives the customer or non-member the choice of using Random List Selection as the method to appoint arbitrators. If a claim includes a customer or a non-member, the election of the customer or non-member controls, and all parties' agreement to use list selection would no longer be required. Finally, because parties rarely requested Enhanced List Selection, the proposed rule change eliminates Enhanced List Selection as a method for selecting arbitrators, but permits parties to choose alternate methods of arbitrator selection pursuant to mutual agreement. The proposed rule change provides that a party can request an arbitrator's last three NYSE arbitration decisions, if any (the pilot program had provided that these decisions would be sent automatically). The proposed rule change also provides that any request for additional information must be made within the ten business days in which the parties must return the lists, and that this time period is applicable to all requests for additional information under NYSE Rule 607 as well as NYSE Rule 608, which governs notice of selection of arbitrators and requires, among other things, the Director of Arbitration to provide the parties with the names and employment histories of the arbitrators for the past ten years, and permits a party to request additional information concerning an arbitrator's background. Lastly, the proposed rule change provides that the NYSE will send lists of arbitrators to parties approximately thirty days after the last answer is filed with the Exchange. 15 15 *See* Amendment No. 4. c. Comparison to SICA Rules The proposed amendments resemble the Uniform Code of Arbitration (“UCA”) developed by the Securities Industry Conference on Arbitration (“SICA”). 16 Aside from word choice and punctuation, the principal differences between the NYSE's proposed rules and the SICA-developed UCA are: 16 The NASD also has a rule that provides for the appointment of arbitrators by list selection. *See* NASD Rule 10308. • The NYSE retains the traditional method of staff appointment. • The NYSE specifies the number of arbitrators on the lists. • The NYSE limits the number of peremptory challenges. • The NYSE eliminates a second list containing three names for each vacancy under the Random List Selection method. • The NYSE does not send the two lists of public and industry arbitrators under the Random List Selection method unless and until the customer or non-member requests in writing the use of the Random List Selection method within 45 days from the date of filing of the statement of claim. • The NYSE sets a ten business day period for the parties to return the lists to the director of arbitration. • The NYSE sets a ten business day period for the parties to request additional information about a potential arbitrator. • The NYSE permits the parties to agree to extend the time period in which to return the lists. B. Comment Summary and NYSE's Response a. Comments Received The proposal was published for comment in the **Federal Register** on June 23, 2005. 17 17 *See* note 6, *supra.* We received four comments on the proposal. 18 One commenter believed that the NYSE should withdraw or amend the proposal and that, in light of other amendments to Rule 607, the NYSE's proposed merger with Archipelago, and the NYSE's shift from a private to a public company, the NYSE should not submit any other amendments to its arbitration rules. 19 One of the commenters stated that NYSE's arbitration system had many advantages over NASD's, including lower expenses and greater NYSE staff involvement, but was concerned that NYSE was not presently a reasonable alternative to NASD's arbitration system. 20 This commenter believed that in order to improve the NYSE's system, the NYSE needed to
(i)“[e]mbrace list selection;”
(ii)“[p]rovide Arbitrator Award histories;”
(iii)“[a]ppoint the Panel earlier in the case;” 21 and
(iv)“[g]ive equal encouragement to claims outside NYC.” In this commenter's view, these changes would make the NYSE a more competitive arbitration forum. 22 18 *See* note 7, *supra.* 19 Clemente Letters. 20 *See* Ryder Letter. 21 The commenter favorably cited the NASD's system of involving arbitrators at the pleading stage in his comments. *See* Ryder Letter. 22 Ryder Letter. Two commenters, although they approved of certain aspects of the filing, such as the elimination of mutuality for list selection, generally criticized the proposed rule change. 23 They expressed concern that the NYSE was not committed to creating a viable arbitration forum or an alternative to the NASD's arbitration system, 24 that the Exchange limited the number of strikes against potential arbitrators on the list, and that the proposed rule change, including its diversion from SICA rules, was not adequately described. 25 One commenter approved of the filing, but believed that the definition of a “public arbitrator” in the rule should be carefully examined to ensure that public arbitrators do not have ties to the securities industry. 26 Another commenter also stated that the Exchange should address the classification of public arbitrators. 27 One commenter was concerned about the procedures for informing parties of the disclosures that arbitrators were required to make on the grounds that these disclosures would not be made before the parties would have to exercise strikes. In this commenter's view, the parties might not learn potentially critical information about the arbitrators until after the arbitrators are appointed (at which time strikes are limited to “for cause”). 28 23 Ryder Letter, Clemente Letters. 24 Ryder Letter. 25 Clemente Letters. 26 Shockman Letter. 27 Clemente Letters. 28 Clemente Letters. In response to the Commission's specific request for comment on whether the Exchange should automatically send parties a potential arbitrator's prior three arbitration decisions, as provided in the pilot program, whether it should only send such decisions upon a party's request, and whether the Exchange should inform parties that prior arbitration decisions are available on its Web site, two commenters believed that the NYSE should list arbitrator awards on its Web site. 29 One commenter believed that the administrative burden of sending the last three decisions was too high but believed that the NYSE should develop reports from its docket records that are similar to the NASD's reports. 30 The other commenter believed that the Exchange should send the last three arbitration awards to the parties automatically. 31 29 Clemente Letters, Ryder Letter. 30 Ryder Letter. 31 Clemente Letters. b. NYSE's Response to Comments The NYSE responded to the commenters' concerns by filing an amendment to the proposed rule text to require the Exchange to send out the lists of arbitrators to all parties approximately 30 days after the last answer is due. 32 This addressed the concern that arbitrators should become involved in the process earlier, in order to allow the panel of arbitrators, rather than the NYSE staff, to administer the proceedings. 33 32 *See* Amendment No. 4. 33 *See* Ryder Letter. The Exchange also submitted a letter response to the commenters. The Exchange stated that even though arbitrators still may be appointed pursuant to administrative appointment, it has “embraced list selection” 34 by giving the public customer/non-member the ability to elect list selection without requiring the agreement of the member firm. The Exchange also indicated that it retained the traditional method of arbitrator selection as a convenience to public customers. 34 *See supra* note 22. In addition, the NYSE observed that during the pilot program, it found that parties often struck all names on the first list, requiring distribution of a second list and delaying the process. The Exchange also found that the parties often exercised peremptory challenges on the arbitrators on the second list. The Exchange maintained that the limited number of strikes will result in careful review and ranking of potential arbitrators, leading to a streamlined list selection process. In response to concerns that the “enhanced list” method of arbitrator appointment was to be eliminated, the Exchange noted that the parties' ability under the proposed rule change to select any reasonable method of arbitrator appointment would allow them to use enhanced list selection. If the parties agree to use enhanced list selection, arbitrators would be appointed to a panel in the same manner as under the pilot program. In response to the question of whether the Exchange should provide parties with the ability to access arbitrators' awards and with hard copies of the arbitrators' last three awards, the Exchange noted that parties are advised that the arbitrators' awards are available on its Web site in the cover letter sent to the parties with the proposed names of the arbitrators. The Exchange also noted that the arbitrators' profiles provide information through which the parties can access all awards for each arbitrator on the NYSE Web site. The Exchange opined that it was inefficient to send out the last three awards automatically, and that the availability of the awards on the Web site would be sufficient to satisfy the parties' need for the awards. The Exchange also noted that it will continue to send out the last three awards to the extent that the parties request them, and that the Exchange will inform the parties of that option in the cover letter sent with the lists of arbitrators. In response to commenters' concerns with the classification of public arbitrators, the Exchange noted that it had filed a separate proposed rule change, NYSE-2005-43, 35 addressing the question of when arbitrators should be classified as “public.” In response to one commenter's concern with the timing of the disclosure of arbitrator conflicts, the Exchange noted that an arbitrator's duty to disclose conflicts pursuant to Rule 610 is a continuing duty, and additional information received by the Exchange pursuant to Rule 610 is immediately forwarded to the parties. 35 *See* Exchange Act Rel. No. 52314 (Aug. 22, 2005), 70 FR 51104 (Aug. 29, 2005) (SR-NYSE-2005-43). III. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning Amendment No. 4, including whether Amendment No. 4 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 e-mail to *rule-comments@sec.gov* . Please include File Number SR-NYSE-2005-02 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-NYSE-2005-02. 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. Copies of such filing also will be available for inspection and copying at the principal office of the NYSE. 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-NYSE-2005-02 and should be submitted on or before December 20, 2005. IV. Discussion and Findings After careful review, the Commission finds that the proposed rule change is consistent with section 6(b) 36 of the Act in general and section 6(b)(5) of the Act 37 in particular, which require that the rules of the Exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade and, in general, to protect investors and the public interest. 38 The proposed rule change makes permanent the pilot program allowing for list selection of arbitrators, but does so with modifications that make it easier for customers to opt for list selection, while retaining the method of traditional arbitrator appointment as an alternative for parties. The proposed rule change institutes a system of selecting arbitrators that is comparable to the SICA's UCA and that of the NASD. Although commenters expressed concerns with various of the modifications between the pilot program and the amendments to NYSE Rule 607 put forth in the proposed rule change, including the elimination of the second list and the limitations on preemptive strikes, the Exchange described the way these provisions had operated during the Exchange's administration of the pilot program, and explained the ways in which these provisions had appeared to the Exchange to delay the arbitration process. In light of the Exchange's experience with the pilot program, the Exchange's decision to eliminate these provisions of the pilot program appears reasonable. The Exchange also explained that arbitrator's past awards are readily available to parties, and that the last three arbitrator award decisions will be sent to parties should they request it. The NYSE also amended its Rule 607 in order to provide for a time period in which the lists of arbitrators should be sent to the parties that is the same as the NASD's requirement, creating consistency between the two systems. 36 15 U.S.C. 78f(b). 37 15 U.S.C. 78f(b)(5). 38 In approving this proposed rule change, the Commission notes that it has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). We believe that the proposed amendments to NYSE Rule 607 will provide the NYSE with a list selection mechanism for selecting arbitrators comparable to that of the NASD and SICA's UCA, and that the list selection process will give customers increased involvement in the selection of the arbitrators who will hear their claims, leading to increased investor confidence in the NYSE's arbitral selection system. Accelerated Approval of Amendment No. 4 The Commission finds good cause for approving Amendment No. 4 to the proposed rule change prior to the thirtieth day after the amendment is published for comment in the **Federal Register** pursuant to section 19(b)(2) of the Act. 39 Amendment No. 4 provided a time period in which the NYSE would be required to provide the parties with lists of arbitrators. Setting a specific time for sending the lists of arbitrators to the parties will create consistency across the arbitration system in place at the NYSE. Further, the timing of the NYSE's sending of the lists to parties is identical to that of the NASD, thereby creating consistency between the two arbitration systems. The Commission finds that, given the benefits of having the Exchange set a specific time for sending out the lists of arbitrators, it is appropriate for the Exchange to amend the proposed rule text to reflect consistency in the involvement of arbitrators in the process. Accordingly, the Commission believes that accelerated approval of Amendment No. 4 is appropriate. 39 15 U.S.C. 78s(b)(2). V. Conclusion *It Is Therefore Ordered* , pursuant to section 19(b)(2) of the Act 40 that the proposed rule change (SR-NYSE-2005-02) be, and hereby is, approved. 40 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 41 41 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6653 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52790; File No. SR-OCC-2005-13] Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Clearing Fees for Certain Transactions Executed on OneChicago, LLC November 17, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 notice is hereby given that on September 29, 2005, The Options Clearing Corporation (“OCC”) 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 prepared primarily by OCC. OCC filed the proposed rule change pursuant to Section 19(b)(3)(A)(ii) of the Act, 2 and Rule 19b-4(f)(2) thereunder, 3 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1 15 U.S.C. 78s(b)(1). 2 15 U.S.C. 78s(b)(3)(A)(ii). 3 17 CFR 240.19b-4(f)(2). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The purpose of the proposed rule change is to charge clearing fees to OneChicago, LLC (“ONE”) for cleared trades where an OCC clearing member is on one or both sides of the trade based on OCC's standard rebate-eligible fee schedule (“Standard Fee Schedule”), rather than under the alternate rebate-ineligible fee schedule (“Alternate Fee Schedule”) adopted when OCC and ONE entered into the Security Futures Agreement for Clearing and Settlement Services (“ONE Clearing Agreement”). II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), (B), and
(C)below, of the most significant aspects of such statements. 4 4 The Commission has modified parts of these statements.
(A)Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change Under the Standard Fee Schedule, OCC clearing members pay OCC's standard clearing fees and are eligible to receive rebates of excess clearing fees when and as determined by OCC's Board of Directors. When negotiating its clearing agreement with OCC, ONE preferred to pay OCC's clearing fees itself rather than have OCC charge those fees to clearing members. 5 Because ONE wanted to plan on set fees and avoid the uncertainty of a rebate that might be less than expected, OCC agreed to an Alternate Fee Schedule which provides for the following fees: 5 At that time, clearing fees under OCC's Standard Fee Schedule were: • 9¢ per side for trades of 1 to 500 contracts. • 7¢ per side for trades of 501 to 1,000 contracts. • 6¢ per side for trades of 1,001 to 2,000 contracts, and • $110 for trades larger than 2,000 contracts. • 7¢ per side for trades of 1 to 500 contracts. • 6¢ per side for trades of 501 to 1,000 contracts. • 5¢ per side for trades of 1,001 to 2,000 contracts, and • $85 for trades larger than 2,000 contracts. 6 6 Securities Exchange Act Release No. 47196 (January 15, 2003), 68 FR 3922 (January 27, 2003) [File No. SR-OCC-2002-20]. Pursuant to the ONE Clearing Agreement, the CME has been designated as an associated clearinghouse (“ACH”) for ONE. Under the Alternate Fee Schedule, different fees are charged where the ACH is on one or both sides of a trade. Those fees are not being changed by this filing. The Alternate Fee Schedule also includes certain new product discounts. 7 Under the terms of the ONE Clearing Agreement, the Alternate Fee Schedule expired on November 8, 2005. 7 Securities Exchange Act Release No. 47196. The “new securities future product” discounts are as follows: • First month traded: No fee. • Second month traded: 2.5¢ regardless of size. • Third month traded: The lesser of the total at 5¢ or $85. • Fourth month traded: Reverts to Alternate Fee Schedule. Since the adoption of the Alternate Fee Schedule, OCC has both reduced and discounted its Standard Fee Schedule. 8 The current discounted Standard Fee Schedule is: 8 *See* Securities Exchange Act Release Nos. 49436 (March 17, 2004), 69 FR 13932 (March 24, 2004) [File No. SR-OCC-2004-01], 50080 (July 26, 2004), 69 FR 45873 (July 30, 2004) [File No. SR-OCC-2004-12], 50951 (December 30, 2004), 70 FR 1489 (January 7, 2005) [File No. SR-OCC-2004-22], and 52034 (July 14, 2005), 70 FR 42134 (July 21, 2005) [File No. SR-OCC-2005-08]. • 5¢ per contract for trades of 1 to 500 contracts. • 4¢ per contract for trades of 501 to 1,000 contracts. • 3¢ per contract for trades of 1,001 to 2,000 contracts, and • $55 for trades larger than 2,000 contracts. This discounted fee structure remains in effect until further action by OCC's Board of Directors. In response to a request by ONE, OCC has agreed to charge fees to ONE under the Standard Fee Schedule including standard new product fee discounts 9 for trades where at least one side is cleared by an OCC clearing member. OCC is willing to provide ONE with the benefit of the Standard Fee Schedule for such trades before the date the Alternate Fee Structure for ONE is set to expire. Accordingly, effective October 1, 2005, OCC charged ONE clearing fees based on the Standard Fee Schedule. Any refund of clearing fees charged under the Standard Schedule will be paid to ONE. 9 The “new products” discounts under the Standard Schedule are as follows: • First month traded: No fee. • Second month traded: For trades with contracts of: 1-4,400—1 cent/side. > 4,400—$40. • Third month traded: For trades with contracts of: 1-2,200—2 cents/side. > 2,200—$40. • Fourth month traded: Reverts to Standard Fee Schedule. OCC believes that the proposed change is consistent with Section 17A of the Act because it provides the benefit of a discounted, rebate-eligible clearing fee schedule for certain trades to a market for which OCC provides clearance and settlement services. The proposed rule change is not inconsistent with the existing rules of OCC, including any other rules proposed to be amended.
(B)Self-Regulatory Organization's Statement on Burden on Competition OCC does not believe that the proposed rule change would impose any burden on competition.
(C)Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received from Members, Participants, or Others Written comments were not and are not intended to be solicited with respect to the proposed rule change, and none have been received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act 10 and Rule 19b-4(f)(2) 11 thereunder because it establishes or changes a due, fee, or other charge. At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 10 15 U.S.C. 78s(b)(3)(A)(ii). 11 17 CFR 240.19b-4(f)(2). 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-OCC-2005-13 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-OCC-2005-13. 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 Section, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of OCC and on OCC's Web site at *http://www.optionsclearing.com.* 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-OCC-2005-13 and should be submitted on or before December 20, 2005. 12 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 12 Jonathan G. Katz, Secretary. [FR Doc. E5-6618 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52789; File No. SR-OCC-2005-14] Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Position Sub-Accounts November 17, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 notice is hereby given that on September 29, 2005, The Options Clearing Corporation (“OCC”) 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 prepared primarily by OCC. OCC filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act, 2 and Rule 19b-4(f)(4) thereunder, 3 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1 15 U.S.C. 78s(b)(1). 2 15 U.S.C. 78s(b)(3)(A)(iii). 3 17 CFR 240.19b-4(f)(4). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change sets forth certain interpretations as to the treatment of position sub-accounts maintained with respect to one or more account types established by a clearing member under a particular clearing member number 4 in the event of the clearing member's liquidation. 5 4 Clearing member numbers are used to identify clearing members within OCC's system. For a variety of reasons, a clearing member may use more than one clearing member number. *See* Securities Exchange Act Release No. 47194 (January 15, 2003), 68 FR 3923 (January 27, 2003) [File No. SR-OCC-2002-26]. 5 The proposed change to Article VI, Section 3, Interpretation and Policy .02 is conforming in nature and reflects the Commission's recent approval of the proposed rule change in Securities Exchange Act Release No. 52030 (July 14, 2005), 70 FR 42405 (July 22, 2005) [File No. SR-OCC-2003-04]. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), (B), and
(C)below, of the most significant aspects of such statements. 6 6 The Commission has modified parts of these statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change OCC's clearing systems have historically contained functionality that identifies the positions of each market maker participating in a combined market makers' account. 7 Position sub-accounting in a combined market makers' account is accomplished by using each participating market maker's unique acronym to identify the market maker's trades for clearance and settlement, including position reporting. Because of the large number of transactions effected by market makers, reporting their positions on a sub-account basis facilitates clearing member reconciliation and balancing processes. Position sub-accounting also avoids the need for firms carrying a combined market makers' account to allocate assignments to particular market makers because OCC assigns exercise notices directly to market maker sub-accounts. 8 7 A combined market makers' account is confined to the exchange transactions of the market makers for which it was established. OCC also permits sub-accounting within a clearing member's segregated futures professional account. All positions carried within each of these account types are maintained on sub-account basis. 8 Securities Exchange Act Release No. 46735 (October 28, 2002), 67 FR 67434 (November 5, 2002) [File No. SR-OCC-2002-19]. OCC's new clearing system, ENCORE, was designed to extend position sub-accounting to other account types that a clearing member may maintain with OCC although this functionality has not yet been offered to clearing members. Once OCC completes a system and clearing member readiness assessment, OCC intends to gradually roll out position sub-accounting for these other account types to interested clearing members. OCC expects the roll-out to commence in or about the second quarter of 2006. OCC anticipates that interested clearing members will initially limit their use of the new sub-accounts to large-volume customers such as institutions and foreign affiliates in order to further improve the efficiency of their reconciliation processes. Like the process used to provide position sub-accounting for market makers, unique identifying acronyms will be assigned for use by clearing members in creating position sub-accounts with respect to other accounts maintained under a given clearing member number. Exchange transactions may be directly cleared into a sub-account by submitting the applicable assigned acronym in the matching trade information. Alternatively, a clearing member would be permitted to effect a post-trade instruction in OCC's systems to transfer the position to a sub-account. As in the case of market maker sub-accounts, OCC will assign exercise notices directly to applicable position sub-accounts. 9 9 Exchange rules require member firms to establish fixed procedures for allocating assignments to customers and to inform their customers of the method used and how it works. *See, e.g.* , CBOE Rule 11.2. OCC will require clearing members that establish customer sub-accounts to give each customer for which a sub-account is opened a notice disclosing that OCC will assign exercises directly to the sub-account. The potential increase in the number of sub-accounts that may be carried on OCC's books, coupled with the fact that sub-accounts would now be permitted to be maintained in accounts in which positions also are carried on an omnibus basis, has led OCC to conclude that it would be advisable to formalize existing interpretations regarding the treatment of position sub-accounts in the event of a clearing member liquidation. For such purposes, market-maker sub-accounts always have been treated as a single account. The proposed rule change codifies this existing interpretation and extends it to the sub-accounts that will now be permitted to be carried in other account types. In order to provide for a controlled implementation of position sub-accounting with respect to other account types, a further interpretation has been added which permits OCC to limit, for systemic or operational reasons, the overall number of sub-accounts that a clearing member may maintain with respect to particular account types. As is the case today, OCC would not limit the number of market professional sub-accounts a clearing member could carry in recognition of their role in providing market liquidity. OCC believes that the proposed change is consistent with Section 17A of Act because by clarifying the application of OCC's liquidation rules to position sub-accounts carried by clearing members it better enables OCC to safeguard the securities and funds in its possession or for which it is responsible. The proposed rule change is not inconsistent with the existing rules of OCC, including any other rules proposed to be amended. B. Self-Regulatory Organization's Statement on Burden on Competition OCC does not believe that the proposed rule change would impose any burden on competition. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were not and are not intended to be solicited with respect to the proposed rule change, and none have been received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act 10 and Rule 19b-4(f)(4) 11 promulgated thereunder because the proposal effects a change in an existing service of OCC that
(A)does not adversely affect the safeguarding of securities or funds in the custody or control of OCC or for which it is responsible and
(B)does not significantly affect the respective rights or obligations of OCC or persons using the service. At any time within sixty days of the filing of the proposed rule change, the Commission may summarily abrogate such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 10 15 U.S.C. 78s(b)(3)(A)(iii). 11 17 CFR 240.19b-4(f)(4). 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-OCC-2005-14 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-OCC-2005-14. 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 Section, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of OCC and on OCC's Web site at *http://www.optionsclearing.com.* 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-OCC-2005-14 and should be submitted on or before December 20, 2005. 12 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 12 Jonathan G. Katz, Secretary. [FR Doc. E5-6623 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52809; File No. SR-PCX-2005-108] Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change Relating to Listing Standards for Investment Company Units and Dissemination of Intraday Optimized Portfolio Value November 18, 2005. 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 26, 2005, the Pacific Exchange, Inc. (“PCX” or “Exchange”), through its wholly owned subsidiary PCX Equities, Inc. (“PCXE” or “Corporation”), filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposal from interested persons and also approving the proposal on an accelerated basis. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange, through its wholly-owned subsidiary PCXE, proposes to amend its rules governing the Archipelago Exchange (“ArcaEx”), the equities trading facility of PCXE. With this filing, the Exchange proposes to amend its listing standards for Investment Company Units (“ICUs”) to provide that PCXE may approve a series of ICUs for trading if one or more major market data vendors disseminates for each series of ICUs listed on ArcaEx an estimate of the value of a share of each series of ICUs, sometimes referred to as the Intraday Optimized Portfolio Value (“IOPV”), at least every 15 seconds during the time these ICUs trade on ArcaEx. The text of the proposed rule change is available on the Exchange's Internet Web site *(http://www.pacificex.com),* at the Exchange's principal office, 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 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 III 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 PCXE Rule 5.2(j)(3), Commentary .01, provides listing standards for ICUs to permit listing and trading of these securities pursuant to Rule 19b-4(e) under the Act. 3 Rule 19b-4(e) provides that the listing and trading of a new derivative securities product by a self-regulatory organization (“SRO”) shall not be deemed a proposed rule change, pursuant to paragraph (c)(1) of Rule 19b-4, if the Commission has approved, pursuant to Section 19(b) of the Act, the SRO's trading rules, procedures and listing standards for the product class that would include the new derivative securities product, and the SRO has a surveillance program for the product class. 4 3 17 CFR 240.19b-4(e). 4 *See* Securities Exchange Act Release No. 40761 (December 8, 1998), 63 FR 70952 (December 22, 1998). The Exchange rules for ICUs currently provide that the Reporting Authority 5 will disseminate for each series of ICUs (in the case of PCXE Rule 5.2(j)(3)) an estimate, updated every 15 seconds, of the value of a share of the series. The IOPV may be based, for example, upon current information regarding the required deposit of securities and cash amount to permit creation of new shares of the series or upon the index value. 6 The Exchange believes that, rather than identifying specifically in its rules the Reporting Authority as the dissemination service, it is preferable to reflect in the rules a requirement for wide dissemination of the IOPV. This proposed rule change would make clear that the IOPV must be widely disseminated by a reputable dissemination service, such as the Consolidated Tape Association, Reuters, or Bloomberg. The Exchange believes that naming the Reporting Authority as the dissemination service is not necessary and that the purpose of the rule would be achieved as long as the service used for dissemination is reputable, accepted in the investment community, and effects appropriately wide dissemination of the IOPV relating to a particular series of ICUs. 5 PCXE Rule 5.1(b)(16) provides that the term “Reporting Authority” in respect of a particular series of ICUs means the Corporation, a subsidiary of the Corporation, or an institution or reporting service designated by the Corporation or its subsidiary as the official source for calculating and reporting information relating to such series, including, but not limited to, any current index or portfolio value; the current value of the portfolio of any securities required to be deposited in connection with issuance of ICUs; the amount of any dividend equivalent payment or cash distribution to holders of ICUs, net asset value, or other information relating to the issuance, redemption or trading of ICUs. The rule further states that:
(i)Nothing in PCXE Rule 5.2(j)(3) implies that an institution or reporting service that is the source for calculating and reporting information relating to ICUs must be designated by the Corporation and
(ii)the term “Reporting Authority” shall not refer to an institution or reporting service not so designated. 6 PCXE Rule 5.2(j)(3), Commentary .01(c). The Exchange therefore proposes to change the listing standards for ICUs to provide that PCXE may approve a series of ICUs for trading if one or more major market data vendors disseminates for each series of ICUs listed on ArcaEx the IOPV every 15 seconds during the time that these ICUs trade on ArcaEx. 2. Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act, 7 in general, and furthers the objectives of Section 6(b)(5) of the Act, 8 in particular, because it is designed to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments and perfect the mechanisms of a free and open market, and to protect investors and the public interest. 7 15 U.S.C. 78f(b). 8 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange 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 Written comments on the proposed rule change were neither solicited nor received. III. 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-PCX-2005-108 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-PCX-2005-108. 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. Copies of such filing also will be available for inspection and copying at the principal offices 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-PCX-2005-108 and should be submitted on or before December 20, 2005. IV. Commission's Findings and Order Granting Accelerated Approval of Proposed Rule Change After careful consideration, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange. 9 In particular, the Commission believes that the proposed rule change is consistent with Section 6(b)(5) of the Act, 10 which requires, among other things, that the rules of the Exchange be designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. 9 In approving this proposed rule change, the Commission has considered its impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). 10 15 U.S.C. 78f(b)(5). Under the proposed rule change, the Exchange would modify its “generic” listing standards under PCXE Rule 5.2(j)(3) applicable to ICUs to remove the requirement that the Reporting Authority disseminate estimated values for each series every 15 seconds. Instead, the proposal would impose a requirement to have one or more major market vendors to disseminate such information during the time that ICUs trade on ArcaEx. For the purposes of this rule, the Exchange notes that its definition of major market data vendor includes the Consolidated Tape and services such as Reuters and Bloomberg. The Exchange has requested that the Commission find good cause for approving the proposed rule change prior to the thirtieth day after publication of notice thereof in the **Federal Register** . The Commission notes that it previously approved a similar rule change for the New York Stock Exchange, Inc. (“NYSE”). 11 11 *See* Securities Exchange Act Release No. 52081 (July 20, 2005), 70 FR 43488 (July 27, 2005) (SR-NYSE-2005-44). The Commission believes that granting accelerated approval of the proposal will allow the Exchange to implement, without undue delay, these listing standards for dissemination of the estimated values for ICUs. Accordingly, the Commission finds good cause, pursuant to Section 19(b)(2) of the Act, 12 for approving this proposal before the thirtieth day after the publication of notice thereof in the **Federal Register** . 12 15 U.S.C. 78s(b)(2). V. Conclusion *It is therefore ordered,* pursuant to Section 19(b)(2) of the Act, 13 that the proposed rule change (SR-PCX-2005-108) is hereby approved on an accelerated basis. 13 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 14 14 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6619 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52814; File No. SR-PCX-2005-85] Self-Regulatory Organizations; Pacific Exchange, Inc.; Order Approving Proposed Rule Change and Amendment Nos. 2 and 3 Thereto Relating to Exposure of Orders in the PCX Plus Crossing Mechanism November 21, 2005. On July 19, 2005, the Pacific Exchange, Inc. (“PCX” or “Exchange”), filed with the Securities and Exchange Commission (“Commission”) a proposed rule change pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 to reduce the exposure period in the Crossing Mechanism of the PCX Plus System from 30 seconds to 10 seconds. The PCX filed Amendment No. 1 to the proposed rule change on September 20, 2005 and subsequently withdrew Amendment No. 1. The PCX filed Amendment Nos. 2 and 3 to the proposed rule change on September 23, 2005 and September 27, 2005, respectively. The proposed rule change, as amended, was published for comment in the **Federal Register** on October 7, 2005. 3 The Commission received no comments on the proposal. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 *See* Securities Exchange Act Release No. 52542 (September 30, 2005), 70 FR 58773. After careful consideration, the Commission finds that the proposed rule change is consistent with the requirements of Section 6(b) of the Act 4 and the rules and regulations thereunder applicable to a national securities exchange, 5 and in particular with Section 6(b)(5) of the Act. 6 The Commission believes that, in the electronic environment of PCX Plus, reducing the exposure period to 10 seconds could facilitate the prompt execution of orders, while providing participants in the PCX Plus System with an adequate opportunity to compete for those orders. 4 15 U.S.C. 78f(b). 5 In approving this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). 6 15 U.S.C. 78f(b)(5). *It is therefore ordered,* pursuant to Section 19(b)(2) of the Act, 7 that the proposed rule change (SR-PCX-2005-85), as amended, is approved. 7 15 U.S.C. 78s(b)(2). 8 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 8 Jonathan G. Katz, Secretary. [FR Doc. E5-6622 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-52811; File No. SR-PCX-2005-125] Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change To Extend Certain Exceptions From the Voting and Ownership Limitations in the Certificate of Incorporation of PCX Holdings, Inc. November 21, 2005. 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 November 15, 2005, the Pacific Exchange, Inc. (“PCX” or the “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I and II below, which Items have been prepared by PCX. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons, and is approving the proposal on an accelerated basis. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change PCX hereby submits to the Commission a proposed rule change to extend certain exceptions from the voting and ownership limitations in the certificate of incorporation of PCX Holdings, Inc. (“PCXH”), a Delaware corporation and the parent company of PCX, approved by the Commission in an order issued on September 22, 2005, 3 so as to allow Archipelago Holdings, Inc. (“Archipelago”), a Delaware corporation and the ultimate parent company of PCXH and PCX, to continue to
(i)own and operate the ATS OTC Function (as defined below) of its wholly-owned subsidiary, Archipelago Trading Services, Inc. (“Arca Trading”), and
(ii)until the closing of the proposed business combination of Archipelago and the New York Stock Exchange, Inc. (the “NYSE”), a New York not-for-profit corporation (the “Proposed Archipelago NYSE Merger”), own and operate the DOT Function (as defined below) of its wholly-owned subsidiary, Archipelago Securities, L.L.C. (“Archipelago Securities”). 3 *See* Securities Exchange Act Release No. 52497 (September 22, 2005), 70 FR 56949 (September 29, 2005) (“Order Approving SR-PCX-2005-90”). II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, PCX 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 III below. The self-regulatory organization 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 a. PCXH Acquisition and the Amendment of the PCXH Certificate of Incorporation On September 26, 2005, Archipelago completed its acquisition of PCXH and all of its wholly-owned subsidiaries, including PCX and PCX Equities, Inc. (“PCXE”) (the “PCXH Acquisition”). The PCXH Acquisition was accomplished by way of a merger of PCXH with a wholly-owned subsidiary of Archipelago, with PCXH being the surviving corporation in the merger and becoming a wholly-owned subsidiary of Archipelago. The certificate of incorporation of PCXH (as amended to date, the “PCXH Certificate of Incorporation”) contains various ownership and voting restrictions on PCXH's capital stock, which are designed to safeguard the independence of the self-regulatory functions of PCX and to protect the Commission's oversight responsibilities. In order to allow Archipelago to own 100% of the capital stock of PCXH, prior to the completion of the PCXH Acquisition, PCX filed with the Commission a proposed rule change which sought to, among other things, amend the PCXH Certificate of Incorporation to create an exception from the voting and ownership restrictions for Archipelago and certain of its related persons (the “Original Rule Filing”). 4 The Original Rule Filing, as amended by Amendment No. 1 and Amendment No. 2 thereto, was approved by the Commission on September 22, 2005 5 and the amended PCXH Certificate of Incorporation became effective on September 26, 2005, upon the closing of the PCXH Acquisition. 4 *See* Pacific Exchange, Inc., Proposed Rule Change Relating to the Certificate of Incorporation of PCX Holdings, Inc., PCX Rules, and Bylaws of Archipelago Holdings, Inc., File No. SR-PCX-2005-90 (August 1, 2005). 5 *See* Order Approving SR-PCX-2005-90. Article Nine of the PCXH Certificate of Incorporation provides that no Person, 6 either alone or together with its Related Persons, 7 may own, directly or indirectly, shares constituting more than 40% of the outstanding shares of any class of PCXH capital stock, 8 and that no Person, either alone or together with its Related Persons who is a trading permit holder of PCX or an equities trading permit holder of PCXE, may own, directly or indirectly, shares constituting more than 20% of any class of PCXH capital stock. 9 Furthermore, the PCXH Certificate of Incorporation provides that, for so long as PCXH controls, directly or indirectly, PCX, no Person, either alone or with its Related Persons, may directly or indirectly vote or cause the voting of shares of PCXH capital stock or give any proxy or consent with respect to shares representing more than 20% of the voting power of the issued and outstanding PCXH capital stock. 10 The PCXH Certificate of Incorporation also places limitations on the right of any Person, either alone or with its Related Persons, to enter into any agreement with respect to the withholding of any vote or proxy. 11 6 “Person” is defined to mean an individual, partnership (general or limited), joint stock company, corporation, limited liability company, trust or unincorporated organization, or any governmental entity or agency or political subdivision thereof. PCXH Certificate of Incorporation, Article Nine, section 1(b)(iv). 7 The term “Related Person,” as defined in the PCXH Certificate of Incorporation, means
(i)with respect to any person, all “affiliates” and “associates” of such person (as such terms are defined in Rule 12b-2 under the Act;
(ii)with respect to any person constituting a trading permit holder of PCX or an equities trading permit holder of PCXE, any broker dealer with which such holder is associated; and
(iii)any two or more persons that have any agreement, arrangement or understanding (whether or not in writing) to act together for the purpose of acquiring, voting, holding or disposing of shares of the capital stock of PCXH. PCXH Certificate of Incorporation, Article Nine, section 1(b)(iv). 8 PCXH Certificate of Incorporation, Article Nine, section 1(b)(i). However, such restriction may be waived by the Board of Directors of PCXH pursuant to an amendment to the Bylaws of PCXH adopted by the Board of Directors, if, in connection with the adoption of such amendment, the Board of Directors adopts a resolution stating that it is the determination of such Board that such amendment will not impair the ability of PCX to carry out its functions and responsibilities as an “exchange” under the Act and is otherwise in the best interests of PCXH and its stockholders and PCX, and will not impair the ability of the Commission to enforce said Act, and such amendment shall not be effective until approved by said Commission; *provided* that the Board of Directors of PCXH shall have determined that such Person and its Related Persons are not subject to any applicable “statutory disqualification” (within the meaning of section 3(a)(39) of the Act). PCXH Certificate of Incorporation, Article Nine, sections 1(b)(i)(B) and 1(b)(i)(C). 9 PCXH Certificate of Incorporation, Article Nine, section 1(b)(ii). 10 PCXH Certificate of Incorporation, Article Nine, section 1(c). 11 *Id.* PCX proposed (and the Commission approved) an exception from the ownership and voting limitations described above by adding a new paragraph at the end of Article Nine of the PCXH Certificate of Incorporation, which provides that for so long as Archipelago directly owns all of the outstanding capital stock of PCXH, these ownership and voting limitations shall not be applicable to the ownership and voting of shares of PCXH by
(i)Archipelago,
(ii)any Person that is a Related Person of Archipelago, either alone or together with its Related Persons, and
(iii)any other Person to which Archipelago is a Related Person, either alone or together with its Related Persons. 12 These exceptions to the ownership and voting limitations, however, shall not apply to any “Prohibited Persons,” 13 which is defined to mean any Person that is, or that has a Related Person that is
(i)an OTP Holder or an OTP Firm (as defined in the rules of PCX) 14 or
(ii)an ETP Holder (as defined in the rules of PCXE), 15 unless such Person is also a “Permitted Person” under the PCXH Certificate of Incorporation. 16 The PCXH Certificate of Incorporation further provides that any Prohibited Person not covered by the definition of a Permitted Person who is subject to and exceeds the voting and ownership limitations imposed by Article Nine as of the date of the closing of the PCXH Acquisition shall be permitted to exceed the voting and ownership limitations imposed by Article Nine only to the extent and for the time period approved by the Commission. 17 12 PCXH Certificate of Incorporation, Article Nine, Section 4. 13 *Id.* 14 PCX rules define an “OTP Holder” to mean any natural person, in good standing, who has been issued an Options Trading Permit (“OTP”) by the Exchange for effecting approved securities transactions on the Exchange's trading facilities, or has been named as a Nominee. PCX Rule 1.1(q). The term “Nominee” means an individual who is authorized by an “OTP Firm” (a sole proprietorship, partnership, corporation, limited liability company or other organization in good standing who holds an OTP or upon whom an individual OTP Holder has conferred trading privileges on the Exchange's trading facilities) to conduct business on the Exchange's trading facilities and to represent such OTP Firm in all matters relating to the Exchange. PCX Rule 1.1(n). 15 PCXE rules define an “ETP Holder” to mean any sole proprietorship, partnership, corporation, limited liability company or other organization in good standing that has been issued an Equity Trading Permit, a permit issued by the PCXE for effecting approved securities transactions on the trading facilities of PCXE. PCXE Rule 1.1(n). 16 “Permitted Person” is defined to mean
(A)any broker or dealer approved by the Commission after June 20, 2005 to be a facility (as defined in Section 3(a)(2) of the Act) of PCX;
(B)any Person that has been approved by the Commission prior to it becoming subject to the provisions of Article Nine of the PCXH Certificate of Incorporation with respect to the voting and ownership of shares of PCXH capital stock by such Person; and
(C)any Person that is a Related Person of Archipelago solely by reason of beneficially owning, either alone or together with its Related Persons, less than 20% of the outstanding shares of Archipelago capital stock. PCXH Certificate of Incorporation, Article Nine, section 4. 17 *Id.* b. ATS OTC Function Arca Trading is a broker-dealer and an ETP Holder of PCXE. The business of Arca Trading includes, among other things, the operation of an alternative trading system (“ATS”) (as defined in Regulation ATS promulgated by the Commission under the Act) 18 for trading of over-the-counter bulletin board securities that are not traded on any securities exchange or Nasdaq (including, for the avoidance of doubt, The NASDAQ National Market and The NASDAQ SmallCap Market) (such function was referred to as the “ATS OTC Function” in the Order Approving SR-PCX-2005-90). Because Arca Trading is a broker-dealer and an ETP Holder, and a wholly-owned subsidiary and, consequently, a Related Person, of Archipelago, it falls within the definition of “Prohibited Persons.” Absent an exception, Archipelago's ownership of PCXH would cause Arca Trading to exceed the voting and ownership limitations imposed by Article Nine of the PCXH Certificate of Incorporation. Therefore, in connection with the PCXH Acquisition, PCX requested an exception on a pilot basis for Arca Trading from the ownership and voting limitations in the PCX Certificate of Incorporation for Archipelago's ownership and operation of the ATS OTC Function of Arca Trading. 19 The Commission approved PCX's proposal and allowed Archipelago to continue to own and operate the ATS OTC Function of Arca Trading for a period of 60 days following the closing of the PCXH Acquisition. 20 The pilot approval was designed to provide the public and other interested parties the opportunity to comment on the exception before the exception being made permanent. In the Order Approving SR-PCX-2005-90, the Commission specifically noted that in its adoption of Regulation ATS, it had stated that exchanges could form subsidiaries that operate ATSs registered as broker-dealers and that such subsidiaries would of course be required to become members of a national securities association or another national securities exchange. 21 18 17 CFR 242.300 through 17 CFR 242.303. 19 *See* Amendment No. 2 to the Original Rule Filing (File Number SR-PCX-2005-90), at 6 (September 16, 2005) (“Amendment No. 2”). 20 *See* Order Approving SR-PCX-2005-90, at 56960. 21 *Id.* at 56959. The Commission also noted in the Order Approving SR-PCX-2005-90 that in adopting Regulation ATS, the Commission stated that any subsidiary or affiliate ATS could not integrate, or otherwise link the ATS with the exchange, including using the premises or property of such exchange for effecting or reporting a transaction, without being considered a facility of the exchange. *Id.* c. DOT Function of Archipelago Securities Archipelago Securities is a registered broker-dealer, a member of the National Association of Securities Dealers, Inc. and an ETP Holder of PCXE. Among other things, Archipelago Securities engages in the business of providing broker-dealer clients with direct connectivity, through the NYSE Designated Order Turnaround System, to the NYSE (such function was referred to as the “DOT Function” in the Order Approving SR-PCX-2005-90). Because Archipelago Securities is a broker-dealer and an ETP Holder, and a wholly-owned subsidiary and, consequently, a Related Person, of Archipelago, it falls within the definition of “Prohibited Persons.” Absent an exception, Archipelago's ownership of PCXH would cause Archipelago Securities to exceed the voting and ownership limitations imposed by Article Nine of the PCXH Certificate of Incorporation. Therefore, in connection with the PCXH Acquisition, PCX requested an exception on a pilot basis for Archipelago Securities from the ownership and voting limitations for Archipelago's ownership and operation of the DOT Function of Archipelago Securities, on the condition that in no event would Archipelago or PCX request that this exception be extended beyond the completion of the Proposed Archipelago NYSE Merger. 22 In the Order Approving SR-PCX-2005-90, the Commission approved PCX's request for Archipelago to continue to own and operate the DOT Function of Archipelago Securities until the earlier of a period of 60 days following the closing of the PCXH Acquisition and the closing of the Proposed Archipelago NYSE Merger. 23 22 *See* Amendment No. 2, at 7. 23 *See* Order Approving SR-PCX-2005-90, at 56960. d. Requests for Approval Because the PCXH Acquisition was consummated on September 26, 2005, the temporary approvals with respect to the ATS OTC Function of Arca Trading and the DOT Function of Archipelago Securities will expire on November 25, 2005. The Exchange hereby submits to the Commission the following requests:
(i)The Exchange hereby requests that the Commission approve Archipelago's ownership and operation of the ATS OTC function of Arca Trading on a permanent basis. Without the Commission's approval sought hereby, upon the expiration of the 60 day pilot approval, Archipelago's ownership of PCXH would cause Arca Trading to exceed the voting and ownership limitations imposed by Article Nine of the PCXH Certificate of Incorporation because ATS, a broker-dealer and an ETP Holder of PCXE, is a wholly owned subsidiary and, consequently, a Related Person, of Archipelago.
(ii)The Exchange hereby requests that the Commission approve an extension of the pilot approval with respect to Archipelago's ownership and operation of the DOT Function of Archipelago Securities until the closing of the Proposed Archipelago NYSE Merger. Without the Commission's approval sought hereby, upon the expiration of the 60 day pilot approval, Archipelago's ownership of PCXH would cause Archipelago Securities to exceed the voting and ownership limitations imposed by Article Nine of the PCXH Certificate of Incorporation because Archipelago Securities, a broker-dealer and an ETP Holder of PCXE, is a wholly owned subsidiary and, consequently, a Related Person, of Archipelago and the approval of the other functions of Archipelago Securities granted by the Commission previously were limited in scope and did not include its DOT Function. 2. Basis The Exchange believes that the proposed rule change in this filing is consistent with section 6(b) of the Act, 24 in general, and furthers the objectives of section 6(b)(1), 25 in particular, in that it enables the Exchange to be so organized so as to have the capacity to be able to carry out the purposes of the Act and to comply, and (subject to any rule or order of the Commission pursuant to section 17(d) or 19(g)(2) of the Act) to enforce compliance by its exchange members and Persons associated with its exchange members, with the provisions of the Act, the rules and regulations thereunder, and the rules of the Exchange. The Exchange also believes that this filing furthers the objectives of section 6(b)(5), 26 in particular, because the rules summarized herein would create a governance and regulatory structure with respect to the operation of the business of PCX 27 that is designed to help prevent fraudulent and manipulative acts and practices; to promote just and equitable principals of trade; to foster cooperation and coordination with Persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities; and to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. 24 15 U.S.C. 78f(b). 25 15 U.S.C. 78f(b)(1). 26 15 U.S.C. 78f(b)(5). 27 PCX clarified that the governance and regulatory structure created by the proposal relates to the operation of PCX's business generally, not only to its options business. Telephone conversation between Janet Angstadt, Deputy General Counsel and Assistant Corporate Secretary, PCX and Jennifer Dodd, Special Counsel, Division of Market Regulation, Commission, on November 21, 2005. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange 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 Written comments on the proposed rule change were neither solicited nor received. III. 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-PCX-2005-125 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-PCX-2005-125. 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. Copies of such filing also will be available for inspection and copying at the principal office of PCX. 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-PCX-2005-125 and should be submitted on or before December 20, 2005. IV. Discussion of Commission Findings and Order Granting Accelerated Approval of Proposed Rule Change After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange. 28 In particular, the Commission finds that the proposal is consistent with section 6(b)(1) of the Act, 29 which requires a national securities exchange to be so organized and have the capacity to be able to carry out the purposes of the Act and to enforce compliance by its members and persons associated with its members with the provisions of the Act, the rules or regulations thereunder, and the rules of the exchange. The Commission also finds that the proposal is consistent with section 6(b)(5) of the Act, 30 which requires, among other things, that the rules of an exchange be designed to promote just and equitable principles of trade, to facilitate transactions in securities, to remove impediments to and perfect the mechanisms of a free and open market and a national market system, and, in general, to protect investors and the public interest. 28 In approving the proposed rule change, the Commission has considered its impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). 29 15 U.S.C. 78f(b)(1). 30 15 U.S.C. 78f(b)(5). Pursuant to section 19(b)(2) of the Act, 31 the Commission may not approve any proposed rule change, or amendment thereto, prior to the thirtieth day after the date of publication of the notice thereof, unless the Commission find good cause for so doing. The Commission hereby finds good cause for approving the proposed rule change prior to the thirtieth day after publishing notice thereof in the **Federal Register** pursuant to section 19(b)(2) of the Act. 32 The Commission believes that the requested extensions are consistent with the terms and conditions set forth in the Order Approving SR-PCX-2005-90, and notes that in its filing, PCX represented that accelerated effectiveness of the proposed rule change before the expiration of the pilot approvals would provide continuity of Archipelago's operation of the ATS OTC Function and DOT Function. The Commission also notes that the proposed changes are extensions of exceptions that the Commission approved on a pilot basis in the Order Approving SR-PCX-2005-90 and, as such, do not raise any new or novel issues. The pilots are both currently set to expire on November 25, 2005. Permitting PCX to extend the pilots will permit Archipelago to avoid disruption of its operation of the ATS OTC Function and the DOT Function. Furthermore, the Commission notes that after the publication of the pilot approvals in the **Federal Register** , the Commission did not receive any comment with respect to Archipelago's ownership and operation of the ATS OTC Function of Arca Trading and the DOT Function of Archipelago Securities. 31 15 U.S.C. 78s(b)(2). 32 *Id.* For the foregoing reasons, the Commission finds that the proposed rule change is consistent with the requirements of the Act the rules and regulations thereunder, and finds that good cause exists to accelerate approval of the proposed rule change, pursuant to section 19(b)(2) of the Act. 33 33 *Id.* V. Conclusion *It Is Therefore Ordered* , pursuant to section 19(b)(2) of the Act, 34 that the proposed rule change (SR-PCX-2005-125) is approved on an accelerated basis. Specifically, a permanent exception for the ATS OTC Function of Arca Trading is approved; and the exception for the DOT Function of Archipelago Securities is approved on a pilot basis until the closing date of the Proposed Archipelago NYSE Merger. 34 *Id.* For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 35 35 17 CFR 200.30-3(a)(12). Jonathan G. Katz, Secretary. [FR Doc. E5-6624 Filed 11-28-05; 8:45 am] BILLING CODE 8010-01-P SMALL BUSINESS ADMINISTRATION [License No. 02/72-0634] L Capital Partners SBIC, L.P.; Notice Seeking Exemption Under Section 312 of the Small Business Investment Act, Conflicts of Interest Notice is hereby given that L Capital Partners SBIC, L.P., 10 East 53rd Street, 37th Floor, New York, New York 10022, a Federal Licensee under the Small Business Investment Act of 1958, as amended (“the Act”), in connection with the financing of a small concern, has sought an exemption under section 312 of the Act and section 107.730, Financings which Constitute Conflicts of Interest of the Small Business Administration (“SBA”) rules and regulations (13 CFR 107.730 (2002)). L Capital Partners SBIC, L.P. proposes to purchase preferred securities issued by Sceptor Industries, Inc., 8301 State Line Road, Suite 101, Kansas City, MO 64114 (“Sceptor”). The financing will enable Sceptor to expand its scope of licensed technology and intellectual property which will better position Sceptor to obtain growth capital. The financing is brought within the purview of Sec. 107.730(a)(1) of the Regulations because Shalom Equity Fund Limited, an Associate of L Capital Partners SBIC, L.P. owns 42% of the existing and outstanding stock of Sceptor. Therefore, this transaction is considered a financing of an Associate requiring prior SBA approval. Notice is hereby given that any interested person may submit written comments on the transaction, within 15 days of the date of this publication, to the Associate Administrator for Investment, U.S. Small Business Administration, 409 Third Street, SW., Washington, DC 20416. Dated: November 22, 2005. Jaime Guzman-Fournier, Associate Administrator, for Investment. [FR Doc. E5-6633 Filed 11-28-05; 8:45 am] BILLING CODE 8025-01-P SMALL BUSINESS ADMINISTRATION Small Business Size Standards: Waiver of the Nonmanufacturer Rule AGENCY: U.S. Small Business Administration. ACTION: Notice of intent to terminate waiver of the Nonmanufacturer Rule for Commercial Cooking Equipment. SUMMARY: The U.S. Small Business Administration
(SBA)is considering terminating the waiver of the Nonmanufacturer Rule for Commercial Cooking Equipment based on our recent discovery of a small business manufacturer for this class of products. Terminating this waiver will require recipients of contracts set aside for small businesses, service-disabled veteran-owned small businesses, or SBA's 8(a) Business Development Program to provide the products of small business manufacturers or processors on such contracts. DATES: Comments and sources must be submitted on or before December 12, 2005. FOR FURTHER INFORMATION CONTACT: Edith Butler, Program Analyst, by telephone at
(202)619-0422; by FAX at
(202)481-1788; or by e-mail at *edith.butler@sba.gov.* SUPPLEMENTARY INFORMATION: Section 8(a)(17) of the Small Business Act (Act), 15 U.S.C. 637(a)(17), requires that recipients of Federal contracts set aside for small businesses, service-disabled veteran-owned small businesses, or SBA's 8(a) Business Development Program provide the product of a small business manufacturer or processor, if the recipient is other than the actual manufacturer or processor of the product. This requirement is commonly referred to as the Nonmanufacturer Rule. The SBA regulations imposing this requirement are found at 13 CFR 121.406(b). Section 8(a)(17)(b)(iv) of the Act authorizes SBA to waive the Nonmanufacturer Rule for any “class of products” for which there are no small business manufacturers or processors available to participate in the Federal market. As implemented in SBA's regulations at 13 CFR 121.1202 (c), in order to be considered available to participate in the Federal market for a class of products, a small business manufacturer must have submitted a proposal for a contract solicitation or received a contract from the Federal government within the last 24 months. The SBA defines “class of products” based on six digit coding systems. The first coding system is the Office of Management and Budget North American Industry Classification System (NAICS). The second is the Product and Service Code required as a data entry by the Federal Procurement Data System. The SBA received a request on July 25, 2005 to waive the Nonmanufacturer Rule for Commercial Cooking Equipment. In response, on August 25, 2005, SBA published in the **Federal Register** a notice of intent to the waiver of the Nonmanufacturer Rule for Commercial Cooking Equipment. SBA explained in the notice that it was soliciting comments and sources of small business manufacturers of this class of products. In response to this notice, a comment was received from an interested party. Accordingly, based on the available information, SBA has determined that there is a small business manufacturer of this class of products, and, is therefore considering terminating the class waiver of the Nonmanufacturer Rule for Commercial Cooking Equipment, NAICS 333319. Authority: 15 U.S.C. 637(a)(17). Dated: November 22, 2005. Karen C. Hontz, Associate Administrator for Government Contracting. [FR Doc. E5-6635 Filed 11-28-05; 8:45 am] BILLING CODE 8025-01-P DEPARTMENT OF STATE [Public Notice 5239] Culturally Significant Objects Imported for Exhibition Determinations: “The Princess and the Patriot: Ekaterina Dashkova, Benjamin Franklin and the Age of Enlightenment” AGENCY: Department of State. ACTION: Notice. SUMMARY: Notice is hereby given of the following determinations: Pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681, *et seq.* ; 22 U.S.C. 6501 note, *et seq.* ), Delegation of Authority No. 234 of October 1, 1999, Delegation of Authority No. 236 of October 19, 1999, as amended, and Delegation of Authority No. 257 of April 15, 2003 [68 FR 19875], I hereby determine that the objects to be included in the exhibition “The Princess and the Patriot: Ekaterina Dashkova, Benjamin Franklin and the Age of Enlightenment”, imported from abroad for temporary exhibition within the United States, are of cultural significance. The objects are imported pursuant to loan agreements with the foreign owners. I also determine that the exhibition or display of the exhibit objects at The Museum of the American Philosophical Society in Philosophical Hall, Philadelphia, PA, from on or about February 17, 2006, until on or about December 31, 2006, and at possible additional venues yet to be determined, is in the national interest. Public Notice of these Determinations is ordered to be published in the **Federal Register** . FOR FURTHER INFORMATION CONTACT: For further information, including a list of the exhibit objects, contact Richard Lahne, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202/453-8058). The address is U.S. Department of State, SA-44, 301 4th Street, SW., Room 700, Washington, DC 20547-0001. Dated: November 18, 2005. C. Miller Crouch, Principal Deputy Assistant Secretary for Educational and Cultural Affairs, Department of State. [FR Doc. 05-23428 Filed 11-28-05; 8:45 am]
Connectionstraces to 32
Traces to 32 documents
CFR
9 references not yet in our index
  • 19 USC 1675d(b)
  • 10 CFR 2
  • 29 CFR 4203
  • 15 USC 78
  • 17 CFR 240.12
  • 17 CFR 240.19
  • 15 USC 78(f)(b)(4)
  • 15 USC 80a
  • 79 Stat. 985
Citation graph
cites case law
Notices
Notice of extension of comment period
C.F.R.§ 207.2
U.S.C.§ 1673
U.S.C.§ 1673d
C.F.R.§ 1301.33
U.S.C.§ 823
U.S.C.§ 952
C.F.R.§ 1301.34
C.F.R.§ 75.364
C.F.R.§ 50.80
Cite19 USC 1675d(b)
Cite10 CFR 2
Cite29 CFR 4203
Cites 41 · showing 12Cited by 0 across 0 sources
★   the supreme law of the land   ★
Don't Tread on Me
E Pluribus Unum — out of many, one

"If you don't know your rights, you don't have any."

Marginalia · a citizen's law index
A research desk, not legal advice. Always read the cited source before relying on a summary.
Questions or an issue? support@self-law.org
disclaimerMarginalia is a research index, not a law firm. Nothing on this site is legal, tax, or financial advice and no attorney–client relationship is formed by using it. Statutes, regulations, and case law change; summaries, search results, AI output, and member posts may be incomplete, out of date, or wrong. Any interpretation drawn from material on this site should be validated by a licensed attorney in your jurisdiction before you act on it.