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Code · REGISTER · 2007-02-20 · Office of the Assistant Secretary for Public and Indian Housing, HUD · Notices

Notices. Notice of reopening of public comment period

41,926 words·~191 min read·/register/2007/02/20/07-733

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

BILLING CODE 9111-14-P DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT [Docket No. FR-5055-N-02] Use of Census Data in the Indian Housing Block Grant Program (IHBG); Notice of Reopening of Public Comment Period AGENCY: Office of the Assistant Secretary for Public and Indian Housing, HUD. ACTION: Notice of reopening of public comment period. SUMMARY: On December 12, 2006, HUD published a notice in the **Federal Register** seeking public comment on HUD's use of multi-race data in the computation of the Indian Housing Block Grant
(IHBG)program formula. This notice reopens the public comment period. DATES: *Comment Due Date:* April 23, 2007 ADDRESSES: Interested persons are invited to submit comments regarding this rule to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 10276, Washington, DC 20410-0500. Interested persons may also submit comments electronically through the federal electronic rulemaking portal at: *www.regulations.gov* . HUD strongly encourages commenters to submit comments electronically in order to make them immediately available to the public. Commenters should follow the instructions provided on that site to submit comments electronically. Facsimile
(FAX)comments are not acceptable. All communications must refer to the docket number and title. All comments and communications submitted will be available, without revision, for public inspection and copying between 8 a.m. and 5 p.m. weekdays at the above address. Due to security measures at the HUD Headquarters building, an advance appointment to review the public comments must be scheduled by calling the Regulations Divisions at
(202)708-3055 (this is not a toll-free number). Copies of the public comments submitted are also available for inspection and downloading at *www.regulations.gov* . FOR FURTHER INFORMATION CONTACT: Rodger J. Boyd, Deputy Assistant Secretary for Native American Programs, Department of Housing and Urban Development, Office of Public and Indian Housing, 451 Seventh Street, SW., Room 4126, Washington, DC 20410-5000; telephone 202-401-7914 (this telephone number is not toll-free). Individuals with speech or hearing impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339. SUPPLEMENTARY INFORMATION: On December 12, 2006 (71 FR 74748), HUD published a notice in the **Federal Register** that invited public comment on HUD's use of multi-race data in the computation of the IHBG program allocation formula. Specifically, HUD invited public comments on the feasibility of using either single race or multi-race data to determine funding for the Need component of the IHBG formula. See the December 12, 2006, notice for further information. Since publication, HUD has learned that several commenters are unable to submit their comments by the original, February 12, 2006, deadline. Therefore, the deadline for public comments is being reopened for an additional 60 days to allow additional time for public input. Following HUD's review and consideration of the comments received on this notice, HUD may proceed with rulemaking as necessary. Dated: February 12, 2007. Orlando J. Cabrera, Assistant Secretary for Public and Indian Housing. [FR Doc. E7-2832 Filed 2-16-07; 8:45 am] BILLING CODE 4210-67-P DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT [Docket No. FR-5076-D-17] Delegation and Redelegation of Authority for the Office of the Inspector General AGENCY: Office of the Inspector General, HUD. ACTION: Notice of delegation and redelegation of authority. SUMMARY: This notice updates the delegation of authority of the Office of the Inspector General to require by subpoena the production of all information, documents, reports, answers, records, accounts, papers, and other data and documentary evidence necessary in the performance of the functions assigned by the Inspector General Act to the Deputy Inspector General, the Assistant Inspectors General, the Deputy Assistant Inspectors General, the Special Agents in Charge, the Regional Inspectors General for Audit, and the Directors within the Office of Audit. This notice also redelegates to the above-mentioned officials the authority of the Inspector General to cause the seal of the Department to be affixed to certain documents and to certify that a copy of any book, record, paper, microfilm or other document is a true copy of that in the files of the Department. This notice also delegates the authority to the Deputy Inspector General, the Assistant Inspector General for Investigation, the Deputy Assistant Inspectors General for Investigation, and the Special Agents in Charge, to request information under 5 U.S.C. section 552a(b)(7). EFFECTIVE DATE: February 12, 2007. FOR FURTHER INFORMATION CONTACT: Bryan Saddler, Counsel to the Inspector General, Office of the Inspector General, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 8260, Washington, DC 20410-4500, telephone
(202)708-1613. (These are not toll-free numbers.) SUPPLEMENTARY INFORMATION: Section 6(a)(4) of the Inspector General Act of 1978 (5 U.S.C. app.) authorizes the Inspector General to require by subpoena the production of all information, documents, reports, answers, records, accounts, papers, and other data and documentary evidence necessary in the performance of the functions assigned by the Inspector General Act. This notice delegates this authority to issue subpoenas from the Inspector General to the Deputy Inspector General, the Assistant Inspectors General, the Deputy Assistant Inspectors General, the Special Agents in Charge, the Regional Inspectors General for Audit, and the Directors within the Office of Audit. This notice also redelegates to the above-mentioned officials the authority delegated to the Inspector General by the Secretary of HUD in the Delegation of Authority published on July 15, 2003, at 68 FR 41840, which delegated to various officials, including the Inspector General, the authority to cause the seal of the Department to be affixed to certain documents and to certify that a copy of any book, record, paper, microfilm or other document is a true copy of that in the files of the Department. Section 552a(b)(7) authorizes the Inspector General to request information protected by the Privacy Act for a civil or criminal law enforcement activity. This notice delegates to the Deputy Inspector General, the Assistant Inspector General for Investigations, the Deputy Assistant Inspectors General for Investigations, and the Special Agents in Charge, the authority to request information under 5 U.S.C. section 552a(b)(7). The Inspector General has not limited his authority to issue subpoenas or to affix the Departmental seal and certify copies of records, or to request information under 5 U.S.C. § 552a by this delegation or redelegation. Also, this delegation and redelegation of authority prohibits further delegation or redelegation. Accordingly, the Inspector General delegates and redelegates as follows: Section A. Authority Delegated and Redelegated The HUD Inspector General delegates to the Deputy Inspector General, the Assistant Inspectors General, the Deputy Assistant Inspectors General, the Special Agents in Charge, the Regional Inspectors General for Audit and the Directors within the Office of Audit, the authority to require by subpoena the production of all information, documents, reports, answers, records, accounts, papers, and other data and documentary evidence necessary in the performance of the functions assigned by the Inspector General Act pursuant to Section 6(a)(4) of the Inspector General Act of 1978. Additionally, the Inspector General redelegates to the Deputy Inspector General, the Assistant Inspectors General, the Deputy Assistant Inspectors General, the Special Agents in Charge, the Regional Inspectors General for Audit and the Directors within the Office of Audit, the authority under the delegation of authority published at 68 FR 41840 (July 15, 2003) to cause the seal of the Department of Housing and Urban Development to be affixed to such documents as may require its application and to certify that a copy of any book, record, paper, microfilm or other document is a true copy of that in the files of the Department. Additionally, the Inspector General delegates to the Deputy Inspector General, the Assistant Inspector General for Investigations, the Deputy Assistant Inspectors General for Investigations, and the Special Agents in Charge, the authority to request information under5 U.S.C. section 552a(b)(7). Section B. No Further Delegation or Redelegation The authority delegated and redelegated in Section A above may not be further delegated or redelegated. Authority: Section 6(a)(4), Inspector General Act of 1978 (5 U.S.C. App.); Section 7(d), Department of HUD Act (42 U.S.C. 3535(d)); Delegation of Authority, April 15, 1987, at 52 FR 12259; 5 U.S.C. section 552a. Dated: February 12, 2007. Kenneth M. Donohue, Inspector General. [FR Doc. E7-2826 Filed 2-16-07; 8:45 am] BILLING CODE 4210-67-P NATIONAL ARCHIVES AND RECORDS ADMINISTRATION Information Security Oversight Office Public Interest Declassification Board (PIDB); Notice of Meeting Pursuant to Section 1102 of the Intelligence Reform and Terrorism Prevention Act of 2004 which extended and modified the Public Interest Declassification Board
(PIDB)as established by the Public Interest Declassification Act of 2000 (Pub. L. 106-567, title VII, December 27, 2000, 114 Stat. 2856), announcement is made for the following committee meeting: *Name of Committee:* Public Interest Declassification Board (PIDB). *Date of Meeting:* Friday, December 15, 2006. *Time of Meeting:* 9 a.m. to 12:30 p.m. *Place of Meeting:* National Archives and Records Administration, 700 Pennsylvania Avenue, NW, Rooms 500/501, Washington, DC 20408. *Purpose:* To discuss declassification program issues. This meeting will be open to the public. However, due to space limitations and access procedures, the name and telephone number of individuals planning to attend must be submitted to the Information Security Oversight Office
(ISOO)no later than Monday, December 11, 2006. ISOO will provide additional instructions for gaining access to the location of the meeting. *For Further Information Contact:* J. William Leonard, Director Information Security Oversight Office, National Archives Building, 700 Pennsylvania Avenue, NW, Washington, DC 20408, telephone number
(202)357-5250. Dated: February 12, 2007. J. William Leonard, Director, Information Security Oversight Office. [FR Doc. E7-2866 Filed 2-16-07; 8:45 am] BILLING CODE 7515-01-P NUCLEAR REGULATORY COMMISSION [Docket No. 50-293] Pilgrim Nuclear Power Station, Entergy Nuclear Operations, Inc.; Notice of Consideration of Issuance of Amendment to Facility Operating License, Proposed No Significant Hazards; Consideration Determination, and Opportunity for a Hearing The U.S. Nuclear Regulatory Commission (NRC or the Commission) is considering issuance of an amendment to Facility Operating License No. DPR-35 issued to Entergy Nuclear Operations, Inc. (the licensee) for operation of the Pilgrim Nuclear Power Station (Pilgrim), located in Plymouth County, Massachusetts. The proposed amendment would revise Limiting Condition for Operation
(LCO)3.14.A to adopt the Technical Specification Task Force-484, Revision 0, “Use of Technical Specification 3.10.1 for Scram Time Testing Activities.” Before issuance of the proposed 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 Commission has made a proposed determination that the amendment request involves no significant hazards consideration. Under the Commission's regulations in Title 10 of the Code of Federal Regulations (10 CFR), Section 50.92, this means that operation of the facility in accordance with the proposed amendment would not
(1)involve a significant increase in the probability or consequences of an accident previously evaluated;
(2)create the possibility of a new or different kind of accident from any accident previously evaluated; or
(3)involve a significant reduction in a margin of safety. As required by 10 CFR 50.91(a), the licensee has provided its analysis of the issue of no significant hazards consideration, which is presented below: Criterion 1—The Proposed Change Does Not Involve a Significant Increase in the Probability or Consequences of an Accident Previously Evaluated Technical Specifications currently allow for operation at greater than [200]°F while imposing MODE 4 requirements in addition to the secondary containment requirements required to be met. Extending the activities that can apply this allowance will not adversely impact the probability or consequences of an accident previously evaluated. Therefore, the proposed change does not involve a significant increase in the probability or consequences of an accident previously evaluated. Criterion 2—The Proposed Change Does Not Create the Possibility of a New or Different Kind of Accident From Any Previously Evaluated Technical Specifications currently allow for operation at greater than [200]°F while imposing MODE 4 requirements in addition to the secondary containment requirements required to be met. No new operational conditions beyond those currently allowed by LCO 3.10.1 are introduced. The changes do not involve a physical alteration of the plant (i.e., no new or different type of equipment will be installed) or a change in the methods governing normal plant operation. In addition, the changes do not impose any new or different requirements or eliminate any existing requirements. The changes do not alter assumptions made in the safety analysis. The proposed changes are consistent with the safety analysis assumptions and current plant operating practice. Therefore, the proposed change does not create the possibility of a new or different kind of accident from any accident previously evaluated. Criterion 3—The Proposed Change Does Not Involve a Significant Reduction in a Margin of Safety Technical Specifications currently allow for operation at greater than [200]°F while imposing MODE 4 requirements in addition to the secondary containment requirements required to be met. Extending the activities that can apply this allowance will not adversely impact any margin of safety. Allowing completion of inspections and testing and supporting completion of scram time testing initiated in conjunction with an inservice leak or hydrostatic test prior to power operation results in enhanced safe operations by eliminating unnecessary maneuvers to control reactor temperature and pressure. Therefore, the proposed change does not involve a significant reduction in a margin of safety. The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration. The Commission is seeking public comments on this proposed determination. Any comments received within 30 days after the date of publication of this notice will be considered in making any final determination. Normally, the Commission will not issue the amendment until the expiration of 60 days after the date of publication of this notice. The Commission may issue the license amendment before expiration of the 60-day period provided that its final determination is that the amendment involves no significant hazards consideration. In addition, the Commission may issue the amendment prior to the expiration of the 30-day comment period should circumstances change during the 30-day comment period such that failure to act in a timely way would result, for example, in derating or shutdown of the facility. Should the Commission take action prior to the expiration of either the comment period or the notice period, it will publish in the **Federal Register** a notice of issuance. Should the Commission make a final No Significant Hazards Consideration Determination, any hearing will take place after issuance. The Commission expects that the need to take this action will occur very infrequently. Written comments may be submitted by mail to the Chief, Rulemaking, Directives and Editing Branch, Division of Administrative Services, Office of Administration, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, and should cite the publication date and page number of this **Federal Register** notice. Written comments may also be delivered to NRC's Public Document Room (PDR), located at One White Flint North, Public File Area O1F21, 11555 Rockville Pike (first floor), Rockville, Maryland. The filing of requests for hearing and petitions for leave to intervene is discussed below. Within 60 days after the date of publication of this notice, the licensee may file a request for a hearing with respect to issuance of the amendment to the subject facility operating license and any person whose interest may be affected by this proceeding and who wishes to participate as a party in the proceeding must file a written request for a hearing and a petition for leave to intervene. Requests for a hearing and a petition for leave to intervene shall be filed in accordance with the Commission's “Rules of Practice for Domestic Licensing Proceedings” in 10 CFR Part 2. Interested persons should consult a current copy of 10 CFR 2.309, which is available at the Commission's PDR, located at One White Flint North, Public File Area O1F21, 11555 Rockville Pike (first floor), Rockville, Maryland. Publicly-available records will be accessible 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/doc-collections/cfr/.* If a request for a hearing or petition for leave to intervene is filed by the above date, the Commission or a presiding officer designated by the Commission or by the Chief Administrative Judge of the Atomic Safety and Licensing Board Panel, will rule on the request and/or petition; and the Secretary or the Chief Administrative Judge of the Atomic Safety and Licensing Board will issue a notice of a hearing or an appropriate order. As required by 10 CFR 2.309, a petition for leave to intervene shall set forth with particularity the interest of the petitioner in the proceeding, and how that interest may be affected by the results of the proceeding. The petition should specifically explain the reasons why intervention should be permitted with particular reference to the following general requirements:
(1)The name, address and telephone number of the requestor or petitioner;
(2)the nature of the requestor's/petitioner's right under the Act to be made a party to the proceeding;
(3)the nature and extent of the requestor's/petitioner's property, financial, or other interest in the proceeding; and
(4)the possible effect of any decision or order which may be entered in the proceeding on the requester/petitioner's interest. The petition must also identify the specific contentions which the petitioner/requestor seeks to have litigated at the proceeding. Each contention must consist of a specific statement of the issue of law or fact to be raised or controverted. In addition, the petitioner/requestor shall provide a brief explanation of the bases for the contention and a concise statement of the alleged facts or expert opinion which support the contention and on which the petitioner intends to rely in proving the contention at the hearing. The petitioner/requestor must also provide references to those specific sources and documents of which the petitioner is aware and on which the petitioner intends to rely to establish those facts or expert opinion. The petition must include sufficient information to show that a genuine dispute exists with the applicant on a material issue of law or fact. Contentions shall be limited to matters within the scope of the amendment under consideration. The contention must be one which, if proven, would entitle the petitioner to relief. A petitioner/requestor who fails to satisfy these requirements with respect to at least one contention will not be permitted to participate as a party. Those permitted to intervene become parties to the proceeding, subject to any limitations in the order granting leave to intervene, and have the opportunity to participate fully in the conduct of the hearing. If a hearing is requested, the Commission will make a final determination on the issue of no significant hazards consideration. The final determination will serve to decide when the hearing is held. If the final determination is that the amendment request involves no significant hazards consideration, the Commission may issue the amendment and make it immediately effective, notwithstanding the request for a hearing. Any hearing held would take place after issuance of the amendment. If the final determination is that the amendment request involves a significant hazards consideration, any hearing held would take place before the issuance of any amendment. Nontimely requests and/or petitions and contentions will not be entertained absent a determination by the Commission or the presiding officer of the Atomic Safety and Licensing Board that the petition, request and/or the contentions should be granted based on a balancing of the factors specified in 10 CFR 2.309(c)(1)(i)-(viii). A request for a hearing or a petition for leave to intervene must be filed by:
(1)First class mail addressed to the Office of the Secretary of the Commission, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, *Attention:* Rulemaking and Adjudications Staff;
(2)courier, express mail, and expedited delivery services: Office of the Secretary, Sixteenth Floor, One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852, *Attention:* Rulemaking and Adjudications Staff;
(3)E-mail addressed to the Office of the Secretary, U.S. Nuclear Regulatory Commission, *HEARINGDOCKET@NRC.GOV* ; or
(4)facsimile transmission addressed to the Office of the Secretary, U.S. Nuclear Regulatory Commission, Washington, DC, *Attention:* Rulemakings and Adjudications Staff at
(301)415-1101, verification number is
(301)415-1966. A copy of the request for hearing and petition for leave to intervene should also be sent to the Office of the General Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, and it is requested that copies be transmitted either by means of facsimile transmission to 301-415-3725 or by e-mail to *OGCMailCenter@nrc.gov.* A copy of the request for hearing and petition for leave to intervene should also be sent to Travis C. McCullough, Assistant General Counsel, Entergy Nuclear Operations, Inc., 400 Hamilton Avenue, White Plains, NY 10601, attorney for the licensee. For further details with respect to this action, see the application for amendment dated December 27, 2006, which is available for public inspection at the Commission's PDR, located at One White Flint North, File Public Area O1 F21, 11555 Rockville Pike (first floor), Rockville, Maryland. Publicly-available records will be accessible from the 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.* For The Nuclear Regulatory Commission. Dated at Rockville, Maryland, this 8th day of February 2007. James Kim, Project Manager, Plant Licensing Branch I-1, Division of Operating Reactor Licensing, Office of Nuclear Reactor Regulation. [FR Doc. E7-2804 Filed 2-16-07; 8:45 am] BILLING CODE 7590-01-P NUCLEAR REGULATORY COMMISSION Notice of Availability of Draft Interim Staff Guidance Document Hlwrs-Isg-03, “Preclosure Safety Analysis—Dose Performance Objectives and Radiation Protection Program” AGENCY: Nuclear Regulatory Commission. ACTION: Notice of availability. FOR FURTHER INFORMATION, CONTACT: Jon Chen, Project Manager, Project Management Branch B, Division of High-Level Waste Repository Safety, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, *Telephone:*
(301)415-5526; *fax number:*
(301)415-5399; *e-mail: jcc2@nrc.gov.* SUPPLEMENTARY INFORMATION: I. Introduction The Yucca Mountain Review Plan
(YMRP)(July 2003, NUREG-1804, Revision 2) provides guidance for U.S. Nuclear Regulatory Commission
(NRC)Division of High-Level Waste Repository Safety (HLWRS) staff to evaluate a U.S. Department of Energy
(DOE)license application for a geologic repository. NRC has prepared Interim Staff Guidance
(ISG)to provide clarifications or refinements to the guidance provided in the YMRP. NRC is soliciting public comments on Draft HLWRS-ISG-03, which will be considered in the final version, or subsequent revisions, to HLWRS-ISG-03. II. Summary The purpose of this notice is to provide the public with an opportunity to review and comment on draft HLWRS-ISG-03, which is to supplement the YMRP, for the NRC staff review of consequence estimates for the preclosure safety analysis, and the associated radiation protection program that will be implemented by DOE during geologic repository operations area operations. This ISG revises Sections 2.1.1.5 and 2.1.1.8 of the YMRP. A sufficient description of the radiation protection program and adequate technical bases for consequence estimates are needed to demonstrate compliance with the performance objectives in *Code of Federal Regulations* (CFR), Title 10, Part 63 (10 CFR Part 63), and radiation protection requirements of 10 CFR Part 20. III. Further Information The documents related to this action are available electronically at NRC's Electronic Reading Room, at *http://www.nrc.gov/reading-rm/adams.html.* From this site, a member of the public can access NRC's Agencywide Documents Access and Management System (ADAMS), which provides text and image files of NRC's public documents. The ADAMS accession number for the document related to this notice is provided in the following table. If an individual does not have access to ADAMS, or if there are problems in accessing the documents located in ADAMS, contact the NRC Public Document Room Reference
(PDR)staff, at 1-800-397-4209, or
(301)415-4737, or by e-mail, at *pdr@nrc.gov.* ISG ADAMS accession number Draft HLWRS-ISG-03, “Preclosure Safety Analysis—Dose Performance Objectives and Radiation Protection Program” ML070230090. These documents may also be viewed electronically, on the public computers located at NRC's PDR, O-1F21, One White Flint North, 11555 Rockville Pike, Rockville, MD 20852. The PDR reproduction contractor will copy documents, for a fee. Comments and questions on draft HLWRS-ISG-03 should be directed to the NRC contact listed below by April 6, 2007. Comments received after this date will be considered if it is practical to do so, but assurance of consideration cannot be given to comments received after this date. *Contact:* Sheena Whaley, Nuclear Engineer, Technical Review Directorate, High-Level Waste Repository Safety Division of the Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001. Comments can also be submitted by telephone, fax, or e-mail, which are as follows: *telephone:*
(301)415-7965; *fax number:*
(301)415-5399; or *e-mail: saw2@nrc.gov.* Dated at Rockville, Maryland this 9th day of February 2007. For the Nuclear Regulatory Commission. N. King Stablein, Chief, Project Management Branch B, Division of High-Level Waste Repository Safety, Office of Nuclear Material Safety and Safeguards. [FR Doc. E7-2803 Filed 2-16-07; 8:45 am] BILLING CODE 7590-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55272; File No. SR-Amex-2006-77] Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval to Proposed Rule Change and Amendment No. 1 Thereto To Amend Rules 918 and 918-Ante Regarding Trading Rotations, Halts and Suspensions February 12, 2007. I. Introduction On August 16, 2006, the American Stock Exchange LLC (“Amex” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change to amend Amex Rules 918 and 918-ANTE relating to trading rotations and trading halts. On December 5, 2006, Amex filed Amendment No. 1 to the proposed rule change. The proposed rule change, as modified by Amendment No. 1, was published for comment in the **Federal Register** on December 29, 2006. 1 The Commission received no comments regarding the proposal. This order approves the proposed rule change as modified by Amendment No. 1. 1 *See* Securities Exchange Act Release No. 54995 (December 21, 2006), 71 FR 78474. II. Discussion and Commission Findings The Exchange proposes to amend Amex Rules 918 and 918-ANTE relating to trading rotations and trading halts. Specifically, Amex Rules 918(a) and 918-ANTE(a) currently provide that a trading rotation shall be employed at the opening of each business day following the opening of the underlying security in the primary market. Amex Rules 918(b) and 918-ANTE(b) provide that trading on any Exchange option contract may be halted or suspended whenever the Exchange deems such action appropriate. Included in these rules is a list of factors that the Exchange may use to determine if a trading halt or suspension is warranted. Pursuant to Amex Rules 918(b)(1) and 918-ANTE(b)(1), the Exchange may halt or suspend trading in an option contract if the underlying security has been halted or suspended in the primary market. Similarly, the Exchange may also consider, pursuant to Amex Rules 918(b)(2) and 918-ANTE(b)(2), halting or suspending trading in an option contract if the opening of such underlying stock in the primary market has been delayed due to unusual circumstances. “Primary market” is defined in Amex Rules 900(b)(26) and 900-ANTE(b)(26) as
(i)With respect to an underlying equity security which is principally traded on a national securities exchange, the principal exchange market in which the underlying security is traded,
(ii)with respect to an underlying equity security which is principally traded in the over-the-counter market, the market reflected by Nasdaq, 2 and
(iii)with respect to any other type of security, the market reflected by any widely recognized quotation dissemination system. 2 The Commission notes that Nasdaq currently operates as a national securities exchange with respect to Nasdaq-listed securities and as a facility of the NASD with respect to non-Nasdaq exchange listed securities. The Exchange proposes to amend Amex Rules 918(a)(1) and Amex Rule 918-Ante(a)(1) to permit the opening rotation to begin once the underlying security has opened for trading in any market. In addition, Amex proposes to amend Amex Rule 918-Ante Commentary .01(d) to provide that the automated opening rotation shall begin once the opening trade or quote is disseminated by any market. Amex proposes to amend Amex Rules 918(b)(1) and 918-ANTE(b)(1) to implement trading halts and suspensions in any options contract if the underlying security is subject to a trading halt or suspension across several markets or in the primary listed market. Amex also proposes to amend Amex Rules 918(b)(2) and 918-ANTE(b)(2) to institute trading halts and suspensions in any options contract if there is a delay in the opening of the underlying security across several markets or in the primary listed market because of unusual circumstances. Additionally, the Exchange proposes to amend Amex Rules 918 Commentary .01(c) and 918-ANTE Commentary .01(g) to permit the closing rotation to begin once the final price for the underlying security is established in the trading markets and/or the primary listed market. Finally, the Exchange proposes to make clarifying changes to Amex Rules 918 and 918-ANTE to clarify that trading rotations, halts and suspensions apply to any options on a stock, exchange traded fund and trust issued receipt. 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 and, in particular, the requirements of Section 6(b)(5) of the Act, 3 which requires, among other things, Amex's rules be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system. 4 3 15 U.S.C. 78f(b)(5). 4 In approving this proposed rule change the Commission notes that it has considered the proposed rule's impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). Amex represented that the analysis of which market is the “primary market” for purposes of trading rotations and halts has become burdensome and uncertain due to trading of underlying securities in multiple markets. The Commission believes that the proposed rule change will provide Amex with flexibility to determine when to permit opening and closing rotations to begin by removing the requirement that it analyze which market is the primary market. As proposed, Amex may institute opening and closing rotations based on any market trading the underlying security. With regard to trading halts, however, Amex proposes to halt trading if multiple underlying markets have halted trading or if the primary listed market halted trading. The Commission believes that this standard is sufficient to establish when Amex should halt trading in its option contracts. III. Conclusion *It is therefore ordered* , pursuant to Section 19(b)(2) of the Act, 5 that the proposed rule change (SR-Amex-2006-77), as modified by Amendment No. 1, be and hereby is, approved. 5 15 U.S.C. 78s(b)(2). 6 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 6 Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2837 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55277; File No. SR-Amex-2007-19] Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Revise the AEMI Rules to Conform to Changes Previously Made to the AEMI-One Rules for the Pilot February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on February 9, 2007, the American Stock Exchange LLC (“Amex” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by the Exchange. Amex has filed this proposal pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(5) thereunder, 4 which renders it 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 17 CFR 240.19b-4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(5). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to adopt changes to its AEMI rules to match several changes that have already been approved and implemented as part of the Exchange's AEMI-One rules. The proposed changes would:
(i)Eliminate the order types “buy minus” and “sell plus”;
(ii)revise the descriptions of “stop order” and “stop limit order” to provide that “too marketable” stop and stop limit orders for exchange-traded funds (“ETFs”) will be executed, not rejected;
(iii)codify the Exchange's interpretation that a Specialist will not be deemed to be “trading ahead” of a percentage order if an aggressing order that executes against the Specialist's quote automatically elects the percentage order but the percentage order is not executed by that aggressing order due to insufficient remaining interest;
(iv)revise the definition of “specialist emergency quote” to provide for an Exchange-wide upper limit on the number of such quotes that can be sequentially generated;
(v)revise the definition of “stabilizing quote” to provide that such a quote may be issued when orders or quotes on the AEMI Book are exhausted and that auto-ex would be disabled after such a quote is generated so that the Specialist may step in to re-quote the market;
(vi)revise two rules (including the definition of “intermarket sweep order”) to provide, as required by Regulation NMS, that members who choose to send intermarket sweep orders to the Exchange will be obligated to protect the same quotations of other market centers that the Exchange is obligated to protect; and
(vii)correct two internal references in Rule 205-AEMI and add a new subparagraph to provide for the execution of an unexecuted odd-lot balance on an aggressing order that is the result of an unexecuted odd-lot balance on an intermarket sweep order that was routed to another market by the AEMI platform to access a better-priced protected quotation. The text of the proposed rule change is available on the Amex's Web site at *http://www.amex.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 Amex 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. Amex 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange has recently adopted two sets of rules in connection with the operation of its new hybrid market trading platform for equity products and ETFs, designated as AEMI SM (the “Auction and Electronic Market Integration” platform). The initial version of AEMI is referred to as “AEMI-One” and is currently operational on a pilot basis 5 through the day prior to the final date set by the Commission for full operation of all automated trading centers that intend to qualify their quotations for trade-through protection under Rule 611 6 of Regulation NMS (the latter date being referred to as the “Trading Phase Date”). 7 On the Trading Phase Date, the regular AEMI rules will become effective 8 and the AEMI-One rules will cease to be operative. In the final amendment to the AEMI-One rules just prior to their approval by the Commission, the Exchange made several changes that are now reflected in those AEMI-One rules. In addition, the Exchange subsequently filed with the Commission a proposed change to the AEMI-One rule on odd-lot order execution that was immediately effective on filing and that provides for the execution of an unexecuted odd-lot balance on an aggressing order that is the result of an unexecuted odd-lot balance on an order that was routed to another market by the AEMI platform to access a better-priced protected quotation. 9 The purpose of this filing is simply to make conforming changes to the regular AEMI rules so that they match the corresponding AEMI-One rules that have been approved by the Commission and that are currently effective. 5 *See* Securities Exchange Act Release No. 54709 (November 3, 2006), 71 FR 65847 (November 9, 2006) (SR-Amex-2006-72) (Order Approving a Proposed Rule Change and Amendment No 1 Thereto, and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 3, to Adopt New Rules to Implement on a Pilot Basis an Initial Version of AEMI, Its Proposed New Hybrid Market Trading Platform for Equity Products and Exchange Traded Funds). 6 17 CFR 242.611. The Order Protection Rule requires trading centers to establish, maintain, and enforce written policies and procedures reasonably designed to prevent the execution of trades at prices inferior to protected quotations displayed by other trading centers, subject to certain exceptions. 7 The Trading Phase Date is currently established as March 5, 2007. 8 *See* Securities Exchange Act Release No. 54552 (September 29, 2006), 71 FR 59546 (October 10, 2006) (SR-Amex-2005-104) (Order Approving a Proposed Rule Change and Amendments No. 1, 2, 3, 4, and 5 Thereto, and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 6, to Establish a New Hybrid Trading System Known as AEMI). 9 *See* Securities Exchange Act Release No. 54866 (December 4, 2006), 71 FR 71598 (December 11, 2006) (SR-Amex-2006-111) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Odd-Lot Rejections by Away Markets in the AEMI-One Pilot). Elimination of “Buy Minus” and “Sell Plus” Order Types The Exchange proposes to remove the order types “buy minus” and “sell plus” from Rule 131-AEMI(n) (and all references thereto in the AEMI rules) due to lack of demand for these order types and the complexity of the coding that would be involved to incorporate them into the AEMI platform. Execution of “Too Marketable” Stop and Stop Limit Orders for ETFs The Exchange proposes to revise the descriptions of “stop order” in Rule 131-AEMI(o) and “stop limit order” in Rule 131-AEMI(p) to provide that “too marketable” stop and stop limit orders for ETFs will be executed, not rejected. Codification of Exchange Interpretation Regarding “Trading Ahead” of a Percentage Order The Exchange proposes to codify as Commentary .01 to Rule 154-AEMI its interpretation, based on several of the AEMI rules, that a Specialist will not be deemed to be “trading ahead” of a percentage order (of which he is the agent) if
(i)An aggressing order that executes against the Specialist's quote automatically “elects” the percentage order (making it eligible for immediate execution) and
(ii)the percentage order is not executed by that aggressing order due to insufficient remaining interest and therefore reverts back to unelected status. Additionally, the proposed Commentary will provide that any subsequent trade by the Specialist for his own account at the limit price of the percentage order will not constitute “trading ahead” if the percentage order has not been otherwise re-elected at that time. Revised Definitions of “Specialist Emergency Quote” and “Stabilizing Quote” The Exchange proposes to revise the definition of “specialist emergency quote” in Rule 1A-AEMI to provide for an exchange-wide upper limit (not to exceed ten) on the number of specialist emergency quotes that may be sequentially generated. A change in the definition of “stabilizing quote” is also proposed to provide that a stabilizing quote may be issued when orders or quotes on the AEMI Book are exhausted, and that auto-ex would be disabled after the stabilizing quote is generated so that the Specialist may step in to re-quote the market. Obligation of Members to Protected Quotations at Other Market Centers The Exchange proposes to add language to the definition of an “intermarket sweep order” in Rule 131-AEMI(k) to provide, as required by Regulation NMS, that members who choose to send such orders to the Exchange will be obligated to protect the same quotations of other market centers that the Exchange is obligated to protect. Specifically, a member may submit an intermarket sweep order to the Exchange only if the member simultaneously sends an intermarket sweep order for the full displayed size of every other better-priced protected quotation displayed by other trading centers. The same requirement is being added to Rule 126A-AEMI (Protected Bids and Offers of Away Markets). Revisions to Odd-Lot Order Execution Rule The Exchange proposes to correct two internal rule references in Rule 205-AEMI so that they refer to the appropriate AEMI rules. In addition, the Exchange proposes to add a new subparagraph (b)(viii) to provide for the execution of an unexecuted odd-lot balance on an aggressing order that is the result of an unexecuted odd-lot balance on an intermarket sweep order that was routed to another market by the AEMI platform to access a better-priced protected quotation. Specifically, if a partial-lot trade is received from an away market in response to an intermarket sweep order sent by AEMI, resulting in an unexecuted balance which comprises an odd lot, then any unexecuted odd-lot balance on the aggressing order (including the unexecuted odd-lot balance from the intermarket sweep order) shall be traded immediately against the Specialist at the last trade price of the intermarket sweep order, and any remaining unexecuted round-lot balance shall reaggress the AEMI Book in accordance with Rule 126A-AEMI. Illustrative examples of the proposed rule provision were included in the related AEMI-One filing referenced above. 10 10 The corresponding AEMI-One rule refers to an “away market obligation” (which is an immediate-or-cancel limit order) rather than an “intermarket sweep order” based on the expectation that not all markets would be able to receive and execute intermarket sweep orders during the period of the AEMI-One pilot. The Exchange asserts that the proposal to effect the foregoing changes to the AEMI trading system does not significantly affect the protection of investors or the public interest, does not impose any significant burden on competition, and does not have the effect of limiting the access to or availability of the system. 2. Statutory Basis The proposed rule change is designed to be consistent with Regulation NMS, as well as consistent with Section 6(b) of the Act, in general, and furthers the objectives of Section 6(b)(5), 11 in particular, in that it is designed 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 a national market system, and, in general, to protect investors and the public interest. 11 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The proposed rule change will impose no 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 Because the proposed rule change does not:
(1)Significantly affect the protection of investors or the public interest;
(2)impose any significant burden on competition; and
(3)have the effect of limiting the access to or availability of an existing order entry or trading system of the Exchange, the foregoing rule change has become effective immediately pursuant to Section 19(b)(3)(A)(iii) of the Act 12 and Rule 19b-4(f)(5) 13 thereunder. At any time within 60 days of the filing of such 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 the furtherance of the purposes of the Act. 12 15 U.S.C. 78s(b)(3)(A)(iii). 13 17 CFR 240.19b-4(f)(5). 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 at *http://www.sec.gov/rules/sro.shtml;* or • Send an e-mail to *rule-comments@sec.gov.* Please include File No. SR-Amex-2007-19 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File No. SR-Amex-2007-19. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site ( *http://www.sec.gov/rules/sro.shtml* ). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission's Public Reference Room. 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 No. SR-Amex-2007-19 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 14 14 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2840 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55275; File No. SR-CBOE-2006-94] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of a Proposed Rule Change and Amendment No. 1 Thereto Relating to Off-Floor DPMs February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on November 13, 2006, the Chicago Board Options Exchange, Incorporated (“CBOE” or the “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by the Exchange. The Exchange filed Amendment No. 1 to the proposed rule change on January 18, 2007. 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 CBOE proposes to amend CBOE rules to allow a Designated Primary Marker-Maker (“DPM”) to operate remotely away from CBOE's trading floor. The text of the proposed rule change is available on the Exchange's Web site ( *http://www.cboe.com* ), at the Office of the Secretary, CBOE and at the Commission. 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 those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose CBOE proposes to amend its rules to allow a DPM to operate remotely away from CBOE's trading floor. DPMs are member organizations that function in option classes allocated to them as a Market-Maker, and also are subject to the obligations under Rule 8.85 or as otherwise provided in CBOE's Rules. Currently, all DPMs operate on CBOE's trading floor. However, some member organizations have expressed an interest in acting as a DPM remotely away from CBOE's trading floor. As discussed below, the proposed rule change is intended to provide DPMs with the flexibility to operate on CBOE's trading floor (“On-Floor DPM”) or remotely away from CBOE's trading floor (“Off-Floor DPM”). A DPM would only be permitted to operate as an Off-Floor DPM in equity option classes traded on the Hybrid Trading System. CBOE proposes to amend Rule 8.83 to provide that in selecting an applicant for approval as a DPM, the appropriate exchange committee may place one or more conditions on the approval, including, but not limited to, whether the DPM will operate on-floor or off-floor. Additionally, CBOE proposes to amend Rule 8.83 to provide that an On-Floor DPM can request that the appropriate Exchange committee authorize it to operate as an Off-Floor DPM in one or more equity option classes traded on the Hybrid Trading System. The appropriate Exchange committee will consider the factors specified in Rule 8.83(b) in determining whether to permit an On-Floor DPM to operate as an Off-Floor DPM. In the event a DPM is approved to operate as an Off-Floor DPM, Rule 8.83 provides that the Off-Floor DPM can have a DPM Designee trade in open outcry in the option classes allocated to the Off-Floor DPM, but the Off-Floor DPM shall not receive a participation entitlement under Rule 8.87 with respect to orders represented in open outcry. CBOE also proposes to amend Rule 6.45A(a)(C) and Rule 6.74 to make clear that the DPM participation entitlement is only applicable to an On-Floor DPM. As provided in new Interpretation .01 to Rule 8.83, if an Off-Floor DPM wishes to operate as an On-Floor DPM, the Off- Floor DPM can request that the appropriate Exchange Committee authorize it to do so. In making a determination pursuant to this Interpretation, the appropriate Exchange committee would evaluate whether the change is in the best interests of the Exchange, and the committee may consider any information that it believes will be of assistance to it. Factors to be considered may include, but are not limited to, any one or more of the following: performance, operational capacity of the Exchange or the DPM, efficiency, number and experience of personnel of the DPM who will be performing functions related to the trading of the applicable securities, number of securities involved, number of Market-Makers affected, and trading volume of the securities. In connection with this rule change, CBOE proposes to amend certain DPM obligations contained in Rule 8.85. In particular, CBOE proposes to amend the obligation contained in subparagraph (a)(iv) which currently provides that the DPM must assure that the number of DPM Designees and support personnel continuously present at the trading station throughout every business day is not less than the minimum required by the appropriate Exchange committee. CBOE proposes to amend subparagraph (a)(iv) to state that an Off-Floor DPM similarly shall assure that the number of DPM Designees and support personnel continuously overseeing the DPM's activities is not less than the minimum required by the appropriate Exchange committee. Additionally, an Off-Floor DPM shall provide members with telephone access to a DPM Designee at all times during market hours for purposes of resolving problems involving trading on the Exchange. CBOE also proposes to amend the provision in subparagraph (a)(v) of Rule 8.85 that states a DPM shall trade in all securities allocated to the DPM only in the capacity of a DPM and not in any other capacity. CBOE proposes to allow, as part of an existing pilot program applicable to e-DPMs, 3 an Off-Floor DPM to have not more than one Market-Maker affiliated with the Off-Floor DPM trade on CBOE's trading floor in any specific option class allocated to the Off-Floor DPM, provided such Market-Maker is trading on a separate membership. 4 The affiliated Market-Maker would also have to comply with the “Guidelines for Exemptive Relief Under Rule 8.91(e) for Members Affiliated with DPMs”, set forth in Rule 8.91. (Absent the pilot program, an Off-Floor DPM may not allow any Market-Makers affiliated with the Off-Floor DPM to trade on CBOE's trading floor in any class allocated to the Off-Floor DPM.) If the Off-Floor DPM has an affiliated Marker-Maker trade on CBOE's trading floor in any specific option class allocated to the Off-Floor DPM pursuant to the pilot program, Rule 8.85(a)(v) provides that the Off-Floor DPM cannot also have a DPM Designee trading in open outcry in the option classes allocated to the Off-Floor DPM. 3 *See* CBOE Rule 8.93(vii). The Pilot Program is scheduled to expire on March 14, 2007. 4 CBOE proposes to make a corresponding change to the “Guidelines for Exemptive Relief Under Rule 8.91(e) for Members Affiliated with DPMs.” *See* Guidelines, Paragraph (b)(viii). Finally, CBOE proposes to amend Interpretation .02 of Rule 3.8 to allow an Off-Floor DPM to appoint one individual to be the nominee for all memberships utilized by the organization in an Off-Floor DPM capacity. Interpretation .02 of Rule 3.8 currently provides that a member organization can appoint one individual to be the nominee for all memberships utilized by the organization in an RMM capacity or an e-DPM capacity. This is an exception to the general requirement of Rule 3.8(a)(ii) which provides that “if a member organization is the owner or lessee of more than one membership, the organization must designate a different individual to be the nominee for each of the memberships.” 2. Statutory Basis CBOE believes the proposed rule change is consistent with the Act and the rules and regulations under the Act applicable to a national securities exchange and, in particular, the requirements of Section 6(b) of the Act. 5 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 6 requirements that the rules of an exchange be designed to remove impediments to and perfect the mechanism for a free and open market and a national market system, and, in general, to protect investors and the public interest. 5 15 U.S.C. 78(f)(b). 6 15 U.S.C. 78(f)(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition CBOE 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 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 Exchange 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, 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-2006-94 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549-1090. All submissions should refer to File Number SR-CBOE-2006-94. 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 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-2006-94 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 7 7 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2849 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55279; File No. SR-ISE-2007-02] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Position and Exercise Limits on the KBW Bank Index February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 8, 2007, the International Securities Exchange, LLC (“ISE” 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 substantially prepared by the ISE. On February 5, 2007, the ISE filed Amendment No. 1 to the proposed rule change. The ISE filed the proposed rule change as a “non-controversial” rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 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 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(6). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange is proposing to increase the position and exercise limits for options on the KBW Bank Index. The text of the proposed rule change is available at the ISE, the Commission's Public Reference Room, and *http://www.iseoptions.com* . 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 ISE included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The ISE 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 recently listed for trading options on the KBW Bank Index (“BKX”) pursuant to the Exchange's generic listing standards found in its Rule 2002(b). Under ISE Rule 2005, a narrow-based index option cannot have position and exercise limits that exceed 31,500 contracts. 5 The Exchange notes that the Philadelphia Stock Exchange (“Phlx”) also currently lists options on BKX. However, pursuant to a Rule 19b-4 filing, the position and exercise limit for options on BKX traded by Phlx is currently 44,000 contracts. 6 Accordingly, the Exchange proposes to increase the position and exercise limit for options on BKX traded at ISE to 44,000 contracts also. The Exchange believes it is important for a product traded at multiple exchanges to have a uniform position and exercise limit in order to eliminate any confusion among investors and other market participants. 5 ISE Rule 2007 generally states that exercise limits for an index option shall be equivalent to the position limit prescribed to that index option. 6 *See* Securities Exchange Act Release No. 49312 (February 24, 2004), 69 FR 9672 (March 1, 2004) (SR-Phlx-2004-13). 2. Statutory Basis The basis under the Act for this proposed rule change is found in Section 6(b)(5), 7 in that the adoption of uniform position and exercise limits for BKX will serve 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. 7 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The proposed rule change does not impose any burden on competition. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not:
(i)Significantly affect the protection of investors or the public interest;
(ii)impose any significant burden on competition; and
(iii)become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 8 and Rule 19b-4(f)(6) thereunder. 9 8 15 U.S.C. 78s(b)(3)(A). 9 17 CFR 240.19b-4(f)(6). When filing a proposed rule change pursuant to Rule 19b-4(f)(6) under the Act, an exchange is required to give the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has requested that the Commission waive the 5-day pre-filing notice requirement. The Commission has determined to waive this requirement. 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 10 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 the period to commence on February 5, 2007, the date on which the ISE submitted Amendment No. 1. *See* 15 U.S.C. 78s(b)(3)(C). A proposed rule change filed under Rule 19b-4(f)(6) normally may not become operative prior to 30 days after the date of filing. 11 However, Rule 19b-4(f)(6)(iii) 12 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The ISE has requested that the Commission waive the 30-day operative delay. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because the proposed rule change will make the ISE's position and exercise limits for options on BKX consistent with the Phlx's position and exercise limits for such options. 13 Further, the Commission notes that the increased position and exercise limits for Phlx were previously noticed for comment and no comments were received. For this reason, the Commission designates the proposal to be effective and operative upon filing with the Commission. 14 11 17 CFR 240.19b-4(f)(6)(iii). 12 *Id.* 13 *See supra* note 6. 14 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). 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-ISE-2007-02 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-ISE-2007-02. 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 ISE. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-ISE-2007-02 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 15 15 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2842 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55274; File No. SR-NASD-2007-012] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Implement Certain Approved NASD Rule Changes Upon the Operation of the Nasdaq Stock Market LLC for Non-Nasdaq Exchange-Listed Securities February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on February 9, 2007, the National Association of Securities Dealers, Inc. (“NASD”) 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 NASD. The NASD filed the proposed rules change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 which renders the proposed rule change 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 17 CFR 240.19b-4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(6). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The NASD has filed a proposed rule change to
(1)Provide notice that the amendments to the NASD Rule 4700 Series that were approved pursuant to SR-NASD-2006-104 5 will not be implemented;
(2)implement certain amendments that were approved pursuant to SR-NASD-2006-104 upon the operation of the Nasdaq Stock Market LLC (the “Nasdaq Exchange”) as a national securities exchange for non-Nasdaq exchange-listed securities; and
(3)propose additional changes that were not approved pursuant to SR-NASD-2006-104, specifically the deletion of the Rule 4700 Series and Rule 5150. All other rule changes that were approved pursuant to SR-NASD-2006-104, and were not implemented pursuant to SR-NASD-2006-135, 6 will be implemented upon the operation of NASD's Alternative Display Facility (“ADF”) for non-Nasdaq exchange-listed securities, as approved by the Commission on September 28, 2006. 7 The text of the proposed amendments is available at the NASD, from the Commission's Public Reference Room, and on the NASD's Web site ( *http://www.nasd.com* ). 5 *See* Securities Exchange Act Release No. 54798 (November 21, 2006), 71 FR 69156 (November 29, 2006) (order approving SR-NASD-2006-104). 6 *See* Securities Exchange Act Release No. 54984 (December 20, 2006), 71 FR 78245 (December 28, 2006) (notice of filing and immediate effectiveness of SR-NASD-2006-135). 7 *See* Securities Exchange Act Release No. 54537 (September 28, 2006), 71 FR 59173 (October 6, 2006) (order approving SR-NASD-2006-091). 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 NASD 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. NASD 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 On June 30, 2006, the Commission approved SR-NASD-2005-087, which, among other things, proposed an implementation strategy for the operation of the Nasdaq Exchange as a national securities exchange for Nasdaq-listed securities during a transitional period and also proposed rules for reporting trades in Nasdaq-listed securities effected otherwise than on an exchange to the NASD/Nasdaq Trade Reporting Facility (the “NASD/Nasdaq TRF”). 8 On November 21, 2006, the Commission approved SR-NASD-2006-104, which, among other things, proposed amendments necessary to reflect the complete separation of The Nasdaq Stock Market Inc. (“Nasdaq”) from the NASD upon the operation of the Nasdaq Exchange as a national securities exchange for non-Nasdaq exchange-listed securities and also proposed to expand the scope of the NASD/Nasdaq TRF rules to include reporting of over-the-counter trades in non-Nasdaq exchange-listed securities. 9 8 *See* Securities Exchange Act Release No. 54084 (June 30, 2006), 71 FR 38935 (July 10, 2006) (order approving SR-NASD-2005-087). 9 *See* Securities Exchange Act Release No. 54798 (November 21, 2006), 71 FR 69156 (November 29, 2006) (order approving SR-NASD-2006-104). As originally approved, the rule changes in SR-NASD-2006-104 were to become effective on the date that the Nasdaq Exchange commences operation as a national securities exchange for non-Nasdaq exchange-listed securities. However, as described in SR-NASD-2006-135, for a transitional period, Nasdaq has continued to operate the SuperIntermarket
(SiM)trading platform on NASD's behalf via the Transitional System and Regulatory Services Agreement. 10 As contemplated in SR-NASD-2006-135, the NASD has determined to continue to use Nasdaq as a vendor to operate SiM, even upon the Nasdaq Exchange's operation as an exchange for non-Nasdaq exchange-listed securities, which is currently scheduled for February 12, 2007. 11 As such, the current rules relating to SiM will remain in place and the approved rule changes to the Rule 4700 Series in SR-NASD-2006-104 will not be implemented. 10 *See* Securities Exchange Act Release No. 54984 (December 20, 2006), 71 FR 78245 (December 28, 2006) (notice of filing and immediate effectiveness of SR-NASD-2006-135). In that filing, amendments to the Plan of Allocation and Delegation of Functions by NASD to Subsidiaries and the By-Laws of NASD, NASD Regulation and NASD Dispute Resolution, and the deletion of the Nasdaq By-Laws, which were previously approved in SR-NASD-2006-104, were implemented on December 20, 2006 to reflect Nasdaq's complete separation from NASD, and, on that same date, dissolution of NASD's controlling share in Nasdaq. 11 *See* Securities Exchange Act Release No. 54984 (December 20, 2006), 71 FR 78245 (December 28, 2006) (notice of filing and immediate effectiveness of SR-NASD-2006-135), *infra* note 13. In addition, the following rule changes that were approved pursuant to SR-NASD-2006-104 will be implemented on the date upon which the Nasdaq Exchange operates as a national securities exchange for non-Nasdaq exchange-listed securities:
(1)Deletion of the Rule 4900 Series and the 4950 Series; and
(2)adoption of new Rules 5120 (Other Trading Practices) and 5130 (Obligation to Provide Information) relating to trading otherwise than on an exchange. All other rule changes that are part of SR-NASD-2006-104, and were not implemented pursuant to SR-NASD-2006-135 ( *i.e.* , amendments to the Rule 0100 Series; amendments to the Rule 4000 Series and Rule 6100 Series relating to the NASD/Nasdaq TRF; deletion of Rule 4400; amendments to Rule 11890, Interpretive Material
(IM)11890-1 and IM-11890-2; and the deletion of IM-11890-3), will be implemented upon the operation of the ADF for non-Nasdaq exchange-listed securities, which will be the Regulation NMS Trading Phase Date (currently anticipated to be March 5, 2007). 12 12 Pursuant to SR-NASD-2006-091, among other changes, the following will be deleted from the NASD Manual on the Trading Phase Date: the Rule 5200 Series, the Rule 6300 Series and the Rule 6400 Series. In this proposed rule change, NASD is proposing two additional rule changes that were not approved as part of SR-NASD-2006-104. First, NASD is proposing to delete the Rule 4700 Series in its entirety upon the operation of the ADF for non-Nasdaq exchange-listed securities. 13 Second, NASD is proposing to delete Rule 5150 upon the operation of the ADF for non-Nasdaq exchange-listed securities. Rule 5150 requires an NASD member that is registered as a market maker with the Nasdaq Exchange in a non-Nasdaq exchange-listed security to comply with the provisions of NASD Rule 5262 relating to trade-throughs with respect to that security for trades reported to NASD. Rule 5150 was approved by the Commission on September 19, 2006 and will become effective on the date that the Nasdaq Exchange operates as a national securities exchange for non-Nasdaq exchange-listed securities. 14 Upon the operation of the ADF for non-Nasdaq exchange-listed securities, the Rule 5200 Series, including Rule 5262, will be deleted pursuant to NASD-2006-091. Thus, NASD is proposing to delete Rule 5150 on that same date. 13 Thus, in the period between commencement of operation of the Nasdaq Exchange for non-Nasdaq exchange-listed securities and the operation of the ADF for non-Nasdaq exchange-listed securities, the Rule 4700 Series will remain in the NASD Manual as it exists today. Upon the operation of the ADF for non-Nasdaq exchange-listed securities, the Rule 4700 Series will be deleted in its entirety. 14 *See* Securities Exchange Act Release No. 54471 (September 19, 2006), 71 FR 56202 (September 26, 2006) (order approving SR-NASD-2006-081). NASD has filed the proposed rule change for immediate effectiveness. NASD proposes to implement the proposed rule change as described herein. 2. Statutory Basis NASD believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act, 15 which requires, among other things, that NASD rules 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. NASD believes that the proposed rule change will provide an effective mechanism and regulatory framework for quoting and trading activities otherwise than on an exchange in non-Nasdaq exchange-listed securities upon the operation of the Nasdaq Exchange as a national securities exchange for non-Nasdaq exchange-listed securities and the operation of the ADF for non-Nasdaq exchange-listed securities. 15 15 U.S.C. 78o-3(b)(6). B. Self-Regulatory Organization's Statement on Burden on Competition NASD does not believe that the proposed rule change will result in 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 were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not:
(i)Significantly affect the protection of investors or the public interest;
(ii)impose any significant burden on competition; and
(iii)become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, it has become effective pursuant to Section 19(b)(3)(A) of the Act, 16 and Rule 19b-4(f)(6) thereunder. 17 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. 16 15 U.S.C. 78s(b)(3)(A). 17 17 CFR 240.19b-4(f)(6). A proposed rule change filed under Rule 19b-4(f)(6) 18 normally does not become operative prior to 30 days after the date of filing. However, pursuant to Rule 19b-4(f)(6)(iii), 19 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The NASD has asked the Commission to waive the 30-day pre-operative delay. The Commission believes that such waiver is consistent with the protection of investors and the public interest because it would allow the NASD to update and clarify its rules. 20 The Commission notes that the proposed rule change will facilitate the implementation of NASD rules that were subject to notice and comment and approved by the Commission on November 21, 2006. For this reason, the Commission designates the proposed rule change to be operative on the date that the Nasdaq Exchange begins operations as a national securities exchange for non-Nasdaq exchange-listed securities. 18 *Id.* 19 17 CFR 240.19b-4(f)(6)(iii). 20 For purposes only of waiving the operative date of this proposal, the Commission has considered the rule's impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f). 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-NASD-2007-012 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NASD-2007-012. 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 NASD. 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-NASD-2007-012 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 21 21 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2839 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55283; File No. SR-NASD-2007-010] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend NASD Rule 7010 To Modify Pricing for NASD Members Using ITS/CAES System and Inet Facility February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 29, 2007, the National Association of Securities Dealers, Inc. (“NASD”) 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 substantially by NASD. NASD submitted the proposed rule change under Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(2) thereunder, 4 which renders the proposal effective upon filing with the Commission. 5 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. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(2). 5 NASD stipulated the implementation date to be February 1, 2007. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change NASD proposes to amend NASD Rule 7010 to modify the pricing for its members using the ITS/CAES System and the Inet facility (the “Nasdaq Facilities”), which are currently operated by The Nasdaq Stock Market, Inc. and its subsidiaries (“Nasdaq”) as facilities of NASD. The text of the proposed rule change is available on the NASD's Web site at *http://www.nasd.com* , at NASD 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, NASD 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. NASD 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 This proposed rule change modifies the pricing schedule for the systems for trading non-Nasdaq exchange-listed securities that are currently operated as NASD facilities by Nasdaq. The fees apply to the Nasdaq Facilities, but as is currently the case with respect to fees for these systems, the fee schedule reflects the volume of a member's use of ITS/CAES, Inet, and the Nasdaq Market Center (a facility of The NASDAQ Stock Market LLC (the “Nasdaq Exchange”)) in determining applicable fees. 6 The changes made by this proposed rule change relate to order execution fees for ITS/CAES and Inet, fees for routing to venues other than the New York Stock Exchange (the “NYSE”), and fees for routing orders in exchange-traded funds to the NYSE; fees to route other orders to the NYSE are unchanged. 6 The consideration of volumes through the Nasdaq Exchange is a function of the phased transition of Nasdaq from an operator of NASD facilities to a separate national securities exchange. As such, NASD fee schedules will be amended to remove all references to Nasdaq at or shortly after the time when the Nasdaq Exchange begins to trade non-Nasdaq exchange-listed securities, which is currently expected to occur on February 12, 2007. The Nasdaq Exchange has submitted a comparable filing to establish the same fees for Nasdaq-listed securities, which likewise considers trading volumes through ITS/CAES and Inet. *See SR-NASDAQ-2007-003.* When the Nasdaq Exchange begins to trade non-Nasdaq securities, Inet will no longer be operated as an NASD facility for trading non-Nasdaq securities. Accordingly, for the month of February, the volumes used to determine fees for ITS/CAES and Inet will also consider volumes in non-Nasdaq securities through the Nasdaq Market Center. For this reason, a reference to “Nasdaq-listed securities” is being deleted from the explanatory text of Rule 7010(i)(1). This change is necessary to ensure that members using Inet and ITS/CAES prior to the anticipated transition on February 12, 2007 pay fees for that period that reflect a full month's worth of their trading activity. Currently, members with an average daily volume in all securities during the month of
(i)More than 30 million shares of liquidity provided, and
(ii)more than 50 million shares of liquidity accessed and/or routed; or members with an average daily volume through the Nasdaq Facilities in all securities during the month of
(i)More than 20 million shares of liquidity provided, and
(ii)more than 60 million shares of liquidity accessed and/or routed, pay a fee of $0.0027 per share executed when their orders access liquidity on ITS/CAES or Inet or are routed. Members with lower volumes pay a fee of $0.0028 or $0.003, depending on their volumes. The proposed rule change raises the volume thresholds needed to qualify for the $0.0027 fee, such that it will be available to market participants that
(i)Add more than 35 million shares of liquidity per day during the month and route or remove more than 55 million shares of liquidity per day during the month, or
(ii)add more than 25 million shares of liquidity per day during the month and route or remove more than 65 million share of liquidity per day during the month. Currently, members adding more than 30 million shares of liquidity per day during the month receive a liquidity provider credit of $0.0025 per share executed; members providing less liquidity receive a credit of $0.002. The proposed rule change raises the threshold needed to qualify for the $0.0025 rebate to 35 million shares per day. However, the proposed rule change also introduces an intermediate credit of $0.0022 per share executed for members that provide more than 20 million shares of liquidity during the month. The fees reflected in this proposed rule change were announced by Nasdaq on November 30, 2006, 7 as part of a market-wide evolution in the pricing structure for non-Nasdaq listed securities and an effort by Nasdaq to adopt consistent pricing for all types of securities. Previously, the fees charged by Nasdaq and other venues for non-Nasdaq securities had been characterized by low execution and routing fees and no credits for liquidity providers. During the fall of 2006, however, other markets began to adopt higher execution fees, coupled with liquidity provider credits, thereby moving toward a structure that had long been in effect for Nasdaq-listed securities. As of January 2, 2007, NASD likewise introduced fees for the ITS/CAES and Inet that reflected this evolving pricing structure. 8 However, the fees filed for January were intended as a one-month transition away from the previous structure, and therefore included lower thresholds to qualify for favorable pricing. In addition, the new higher thresholds proposed by this proposed rule change reflect the growing volumes of orders for NYSE-listed securities that are executed or routed through Inet and ITS/CAES, and are intended to encourage further usage. 7 *See* Nasdaq Head Trader Alert #2006-199 (November 30, 2006), available at *http://www.nasdaqtrader.com/trader/news/2006/headtraderalerts/hta2006-199.stm* . 8 *See* Securities Exchange Act Release No. 55129 (January 18, 2007), 72 FR 03894 (January 26, 2007). 2. Statutory Basis NASD believes that the proposed rule change is consistent with Section 15A of the Act, 9 in general, and furthers the objectives of Section 15A(b)(5) of the Act, 10 in particular, in that it provides for the equitable allocation of reasonable dues, fees and other charges among members and issuers and other persons using any facility or system which the NASD operates or controls. 9 15 U.S.C. 78o-3. 10 15 U.S.C. 78o-3(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition NASD 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 NASD has neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The proposed rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act 11 and subparagraph (f)(2) of Rule 19b-4 thereunder, 12 because it establishes or changes a due, fee, or other charge imposed by the NASD. 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. 11 15 U.S.C. 78s(b)(3)(a)(ii). 12 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-NASD-2007-010 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NASD-2007-010. 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 NASD. 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-NASD-2007-010 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 13 13 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2841 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55280; File No. SR-NASD-2007-003] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding Fees and Credits for the NASD/BSE Trade Reporting Facility February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 16, 2007, the National Association of Securities Dealers, Inc. (“NASD”) 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 NASD. NASD filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 which renders it 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 17 CFR 240.19b-4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(6). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change NASD proposes to adopt a new NASD Rule 7000D Series relating to fees and credits for the Trade Reporting Facility (“NASD/BSE TRF”) established by NASD and the Boston Stock Exchange (“BSE”). The text of the proposed rule change is available at *www.nasd.com,* NASD, and 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, NASD 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. NASD 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 On December 13, 2006, the Commission approved SR-NASD-2006-115, 5 which established rules relating to the new NASD/BSE TRF. The NASD/BSE TRF will provide NASD members with another mechanism for reporting to NASD locked-in transactions in exchange-listed securities effected otherwise than on an exchange. It is anticipated that the NASD/BSE TRF will commence operation in February 2007 upon successful completion of system testing and certification. The instant proposed rule change would adopt a new NASD Rule 7000D Series relating to fees and credits applicable to the NASD/BSE TRF. 5 *See* Securities Exchange Act Release No. 54932 (December 13, 2006), 71 FR 76409 (December 20, 2006)(order). NASD is proposing that under new Rule 7002D there will be no transaction fee for reporting locked-in trades to the NASD/BSE TRF in securities listed on the New York Stock Exchange (“Tape A”), the American Stock Exchange (“Tape B”), and the Nasdaq Exchange (“Tape C”). Although NASD is not required to file a proposed rule change where no fees are to be assessed, for members' convenience and to avoid potential confusion with the fee structures of other NASD facilities, NASD is proposing Rule 7002D to clarify that there will be no charge for use of the NASD/BSE TRF to report locked-in transactions in exchange-listed securities effected otherwise than on an exchange. The text of proposed Rule 7002D is identical to the text of current Rule 7002C relating to the NASD/NSX TRF. In addition, NASD is proposing a transaction credit program under new Rule 7001D that is identical to the existing transaction credit program for the NASD/Nasdaq TRF under Rule 7001B. 6 NASD members reporting trades in Tape A, Tape B and Tape C stocks to the NASD/BSE TRF will receive a 50% pro rata credit on market data revenue earned by the NASD/BSE TRF with respect to those trade reports after deducting the amount, if any, that the Trade Reporting Facility pays to the Consolidated Tape Association or the Nasdaq Securities Information Processor for capacity usage. Credits will be paid on a quarterly basis. To the extent that market data revenue is subject to any adjustment, credits may be adjusted accordingly. 6 *See* Securities Exchange Act Release No. 54353 (August 23, 2006), 71 FR 51255 (August 29, 2006). NASD also notes that the proposed transaction credit program is substantially equivalent to the existing transaction credit program for the NASD/NSX TRF under Rule 7001C. The only difference between the two programs is that under the NASD/NSX TRF transaction credit program, members receive 50% of gross revenue. Tape A and Tape B revenue is currently distributed to NASD and the exchanges based on number of trades reported, while Tape C revenue is distributed based on an average of the number of trades and number of shares reported. Thus, under the proposed program, the Tape A and Tape B revenue attributable to a member will be based on number of trades reported, while the Tape C revenue attributable to a member would be based on number of trades and number of shares reported. A member will receive 50% of the revenue attributable to it in each of the three tapes. NASD filed the proposed rule change for immediate effectiveness. NASD proposes to implement the proposed rule change on the first day of operation of the NASD/BSE TRF, which is currently anticipated to be in February 2007. 2. Statutory Basis NASD believes that the proposed rule change is consistent with the provisions of Section 15A of the Act, 7 in general, and with Section 15A(b)(5) of the Act, 8 in particular, which requires, among other things, that NASD rules provide for the equitable allocation of reasonable dues, fees and other charges among members and issuers and other persons using any facility or system that NASD operates or controls. NASD believes that the proposed rule change is a reasonable and equitable fee and credit structure in that there will be no fees charged for trade reporting to the NASD/BSE TRF and the proposed transaction credit program is identical to existing credits for the NASD/Nasdaq TRF. 7 15 U.S.C. 7 *o* -3. 8 15 U.S.C. 8 *o* -3(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition NASD does not believe that the proposed rule change will result in 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 were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not:
(i)Significantly affect the protection of investors or the public interest;
(ii)Impose any significant burden on competition; and
(iii)Become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 9 and Rule 19b-4(f)(6) thereunder. 10 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. 9 15 U.S.C. 78s(b)(3)(A). 10 17 CFR 240.19b-4(f)(6). NASD has asked that the Commission waive the 30-day operative delay set forth in Rule 19b-4(f)(6)(iii) under the Act 11 to allow the proposed rule change to be implemented on the first day of operation of the NASD/BSE TRF, which is currently anticipated to be in February 2007. The Commission believes such waiver is consistent with the protection of investors and the public interest, for it will allow the proposed fees and credits to be in place at the time NASD begins operating the NASD/BSE TRF. For these reasons, the Commission designates the proposal to be effective and operative upon filing with the Commission. 12 11 17 CFR 240.19b-4(f)(6)(iii). 12 For purposes only of waiving the 30-day operative delay of this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 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-NASD-2007-003 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NASD-2007-003. 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 NASD. 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-NASD-2007-003 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 13 13 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2852 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55267; File No. SR-NSCC-2006-16] Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Allow Retirement and Other Benefit Plans and Programs Offered By Registered Broker/Dealers To Be Processed Through Its Insurance Processing Service February 9, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 notice is hereby given that on December 13, 2006, the National Securities Clearing Corporation (“NSCC”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change described in Items I, II, and III below, which items have been prepared primarily by NSCC. NSCC 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 so that the proposal was effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested parties. 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 purpose of the proposed rule change is to amend NSCC's Rules related to the Insurance Processing Services (“IPS”) and Insurance Carrier Members in order to allow retirement and other benefit plans and programs offered by registered broker/dealers to be processed on the IPS platform. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, NSCC 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. NSCC has prepared summaries, set forth in sections (A), (B), and
(C)below, of the most significant aspects of these statements. 4 4 The Commission has modified the text of the summaries prepared by NSCC. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change The purpose of this filing is to amend NSCC's Rules related to IPS and Insurance Carrier Members in order to allow retirement and other benefit plans and programs offered by registered broker/dealers to be processed on the IPS platform. Background NSCC's IPS is a non-guaranteed service, meaning that NSCC does not function as a central counterparty or guarantor with respect to payment obligations arising in connection with IPS transactions. IPS was established in 1997 as the Annuities Processing Service, a centralized communication link that connected participating insurance carriers with broker/dealers and other entities that distributed annuities issued by the participating insurance carrier. 5 The service was later expanded to accommodate processing of life insurance products in addition to annuities, and its name was changed to IPS. Similarly, the name of the participating insurance carriers using IPS was changed from “Annuities Carrier Members” to “Insurance Carrier Members.” 6 5 Securities Exchange Act Release No. 39096 (September 19, 1997), 62 FR 50416 (September 25, 1997) [File No. SR-NSCC-96-21]. 6 Securities Exchange Act Release Nos. 40634 (November 4, 1998), 63 FR 63096 (November 10, 1998) [File No. SR-NSCC-98-13] and 41477 (June 4, 1999), 64 FR 31666 (June 11, 1999) [File No. SR-NSCC-99-04]. Currently, IPS provides for the communication of data relating to insurance products (both annuities and life insurance products) and for the settlement of certain payments relating to insurance products, as set forth in NSCC Rule 57, “Insurance Processing Service.” Participating insurance carriers that use IPS to communicate with their distributors information regarding their insurance products are called “Insurance Carrier Members.” Their distributors are called “Members” or “Mutual Fund/Insurance Services Members” and use IPS under authority of NSCC Rule 2, “Members.” The qualifications of Insurance Carrier Members are set forth in Rule 56 and Addendum Q of NSCC's Rules. Certain retirement and other benefit plans and programs offered by a broker/dealer are functionally similar to annuities in that the broker/dealer (functioning as an administrator and/or custodian of the program) offers multiple investment options (typically mutual funds or annuities) within the “wrap” of the program for sale to plan sponsors through distributing broker/dealer intermediaries. Current IPS functionality that is used for annuities and other insurance products is useful in the context of these programs. Examples of such functionalities included the communication of customer positions and activity among the investment options within the program, information regarding the values of the various investment options included within the program, data concerning program commissions and other compensation due to the distributing broker/dealers, and the payment of such commissions and compensation through NSCC's daily money settlement.
(A)Proposed Amendments to NSCC's Rules Under the proposed amendments, the IPS is renamed the “Insurance and Retirement Processing Services” (and is still referred to as “IPS”) and the products processed through IPS are renamed “IPS Eligible Products.” IPS Eligible Products now include, in addition to insurance products, retirement and other benefit plans and programs. “Insurance Carrier Member” is renamed “Insurance Carrier/Retirement Services Member.” Formerly, only insurance companies could qualify under this membership category. Pursuant to the proposed rule change, registered broker/dealers will also be eligible to qualify as Insurance Carrier/Retirement Services Members. The membership qualifications applicable to insurance companies in their capacity as Insurance Carrier/Retirement Services Members are unchanged. The membership qualifications applicable to a broker/dealer in its capacity as an Insurance Carrier/Retirement Services Member will be the same as the qualifications currently applicable to a broker/dealer which acts as a Mutual Fund/Insurance Services Member processing transactions on IPS today as a distributor of insurance products issued by an Insurance Carrier Member. These qualifications, such as the requirement that the broker/dealer maintain $50,000 in excess net capital over that required by the Commission or the broker/dealer's designated examining authority (“Excess Net Capital”), are also the same qualifications required of a broker/dealer that participates in NSCC's Mutual Fund Services, whether acting as a Fund Member (analogous to an Insurance Carrier/Retirement Services Member on IPS) or as a Mutual Fund/Insurance Services Member distributing mutual funds and similar fund products on NSCC's mutual fund processing platform, Fund/Serv. *Rule 1, “Definitions and Descriptions”* The definition of “Eligible Insurance Plan” is deleted and has been replaced by the term “IPS Eligible Product” in order to include retirement and other benefit plans and programs as products that may be processed through IPS. The defined term “Insurance Carrier Member” is changed to “Insurance Carrier/Retirement Services Member, as discussed above. Conforming changes are also made throughout NSCC's Rules. 7 7 References to “Insurance Carrier Members” and the “Insurance Processing Service” are replaced with the new terms throughout NSCC's Rules; however, due to the extent of their use throughout the Rules, these changes have not been reflected in Exhibit 5 to the proposed rule change. An unrelated technical change is made to defined terms “TPA” and “TPA Member” to clarify that a TPA Member must be a third party administrator. Although implied, this had not been expressly stated. *Rule 3, “Lists to be Maintained”* Section 9 of Rule 3 is revised to refer to “IPS Eligible Products,” rather than insurance plans, as the subject of transactions processed on IPS. *Rule 50, “Automated Customer Account Transfer Service” (“ACATs”)* Section 8 of Rule 50 is revised to delete references to an “Insurance Company” as the entity which would confirm or reject an ACATs transfer of IPS Eligible Products. “Insurance Carrier/Retirement Services Member” is substituted in its place. Similar changes are also made to the description of ACATs for Eligible IPS Products in Section 6 of Rule 57. *Rule 56, “Insurance Carrier Member”* Rule 56 is revised to include broker/dealers as entities which can become Insurance Carrier/Retirement Services Members. *Rule 57, “Insurance Processing Service”* Rule 57 is revised to refer to the “Insurance and Retirement Processing Services” in place of the “Insurance Processing Service.” In addition, an error in Section 2(a) is corrected to state that the service is offered by NSCC. *Addendum Q, “Standards of Financial and Operational Capability for Insurance Carrier Members”* Addendum Q is revised to reflect that broker/dealers that are Insurance Carrier/Retirement Services Members or are applicants must meet the general qualifications currently applicable to Insurance Carrier Members (other than with respect to financial qualifications that are applicable solely to insurance companies). In addition, Addendum Q is revised to reflect that such broker/dealers must also maintain $50,000 in Excess Net Capital. The proposed rule change is consistent with the requirements of Section 17A of the Act and the rules and regulations thereunder because the addition of retirement and other benefit plans and programs offered by registered broker/dealers will permit the processing of additional financial products through NSCC and is designed to promote the prompt and accurate clearance and settlement of transactions and to assure the safeguarding of securities and funds in the custody and control of NSCC.
(B)Self-Regulatory Organization's Statement on Burden on Competition NSCC does not believe that the proposed rule change will have any impact or 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 relating to the proposed rule change have not yet been solicited or received. NSCC will notify the Commission of any written comments received by NSCC. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective upon filing pursuant to Section 19(b)(3)(A)(iii) of the Act 8 and Rule 19b-4(f)(4) thereunder 9 because the proposed rule effects a change in an existing service of NSCC that
(i)does not adversely affect the safeguarding of securities or funds in the custody or control of NSCC and
(ii)does not significantly affect the respective rights or obligations of NSCC or those members using the service. At any time within sixty days of the filing of such 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. 8 15 U.S.C. 78s(b)(3)(A)(iii). 9 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-NSCC-2006-16 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NSCC-2006-16. 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. The text of the proposed rule change is available at NSCC, the Commission's Public Reference Room, and *http://www.nscc.com/legal/2006/2006-16.pdf* . 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-NSCC-2006-16 and should be submitted on or before March 13, 2007. For the Commission by the Division of Market Regulation, pursuant to delegated authority. 10 10 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2845 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55268; File No. SR-NYSE-2007-03] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Regarding CurrencyShares SM Japanese Yen Trust February 9, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 9, 2007, the New York Stock Exchange LLC (“NYSE” or the “Exchange”) filed with the Securities and Exchange Commission (“SEC” or “Commission”) the proposed rule change as described in Items I and II, below, which Items have been prepared by the Exchange. On January 26, 2007, the Exchange filed Amendment No. 1 to the proposed rule change. 3 On February 1, 2007, the Exchange filed Amendment No. 2 to the proposed rule change. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons, and is granting accelerated approval to the proposed rule change, as amended. 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. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The NYSE proposes to list and trade the following under Rules 1300A *et seq.* (“Currency Trust Shares” or “Shares”): CurrencyShares SM Japanese Yen Trust (“Trust”). The Trust issues Shares that represent units of fractional undivided beneficial interest in and ownership of the Trust. 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. 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 Trust issues Japanese Yen Shares, referred to herein as “Shares”. Rydex Specialized Products LLC is the sponsor of the Trust (“Sponsor”), The Bank of New York is the trustee of the Trust (“Trustee”), JPMorgan Chase Bank, N.A., London Branch, is the depository for the Trust (“Depository”), and Rydex Distributors, Inc. is the distributor for the Trust (“Distributor”). The Sponsor, Trustee, Depository and Distributor are not affiliated with the Exchange or one another, with the exception that the Sponsor and Distributor are affiliated. The Exchange currently lists and trades Shares of the Euro Currency Trust; CurrencyShares SM Australian Dollar Trust; CurrencyShares SM British Pound Sterling Trust; CurrencyShares SM Canadian Dollar Trust; CurrencyShares SM Mexican Peso Trust; CurrencyShares SM Swedish Krona Trust; and CurrencyShares SM Swiss Franc Trust (“CurrencyShares Trusts”), all of which have the same Sponsor, Trustee, Depository and Distributor as the Trust. 4 4 *See* Securities Exchange Act Release Nos. 52843 (November 28, 2005), 70 FR 72486 (December 5, 2005) (SR-NYSE-2005-65); and 54020 (June 20, 2006), 71 FR 36579, (June 27, 2006) (SR-NYSE-2006-35). According to the Trust's Registration Statement, 5 the investment objective of the Trust is for the Shares issued by the Trust to reflect the price of the Japanese Yen. The Shares are intended to provide institutional and retail investors with a simple, cost-effective means of hedging their exposure to Japanese Yen and otherwise implement investment strategies that involve foreign currency ( *e.g.* , diversify more generally against the risk that the U.S. Dollar (“USD”) will depreciate). 5 The Sponsor, on behalf of the Trust, filed a Form S-1 for the Trust on November 21, 2006 (the “Registration Statement”). *See* Registration No. 333-138881. Overview of the Foreign Exchange Industry 6 According to the Registration Statement, the foreign exchange market is the largest and most liquid financial market in the world. The Exchange states that, as of April 2004, the foreign exchange market experienced average daily turnover of approximately $1.88 trillion, which was a 57% increase (at current exchange rates) from 2001 daily averages. The foreign exchange market is predominantly an over-the-counter market, with no fixed location and it operates 24 hours a day, seven days a week. London, New York and Tokyo are the principal geographic centers of the worldwide foreign exchange market, with approximately 58% of all foreign exchange business executed in the U.K., U.S., and Japan. Other smaller markets include Singapore, Zurich and Frankfurt. 7 6 Except as otherwise specifically noted, the information provided in this Form 19b-4 filing relating to the Shares, foreign currency markets, movements in foreign currency pricing, and related information is based entirely on information included in the Registration Statement. 7 For April 2004, the daily average foreign exchange turnover of the U.S. dollar against the Japanese Yen was approximately $296 billion. *See* Bank for International Settlements, Triennial Central Bank Survey, March 2005, Statistical Annex Tables, Table E-2. In April 2004, the daily average foreign exchange turnover in USD of the Japanese Yen against all other currencies was approximately $359 billion. *See* Statistical Annex Tables, Table E-1. The Exchange states that there are three major kinds of transactions in the traditional foreign exchange markets: spot transactions, outright forwards and foreign exchange swaps. “Spot” trades are foreign exchange transactions that settle typically within two business days with the counterparty to the trade. Spot transactions account for approximately 35% of reported daily volume in the traditional foreign exchange markets. “Forward” trades, which are transactions that settle on a date beyond spot, account for 12% of the reported daily volume, “Swap” transactions, in which two parties exchange two currencies on one or more specified dates over an agreed period and exchange them again when the period ends, account for the remaining 53% of volume. There also are transactions in currency options, which trade both over-the-counter and, in the U.S., on the Philadelphia Stock Exchange (“Phlx”). Currency futures are transactions in which an institution buys or sells a standardized amount of foreign currency on an organized exchange for delivery on one of several specified dates. Currency futures are traded on a number of regulated markets, including the International Monetary Market division of the Chicago Mercantile Exchange (“CME”), the Singapore Exchange Derivatives Trading Limited (“SGX,” formerly the Singapore International Monetary Exchange or SIMEX), and the London International Financial Futures Exchange (“LIFFE”). Over 85% of currency derivative products (swaps, options and futures) are traded over-the-counter. 8 8 *See* Bank for International Settlements, Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity in April 2004, September 2004 (Tables 2 and 6). Futures on Japanese Yen are traded on the CME (both exchange pit trading and GLOBEX trading). Standardized options on the Japanese Yen trade on Phlx. Phlx also offers more customized options on certain currency pairs. 9 9 For the period January through October, 2006, Japanese Yen and E-mini Japanese Yen futures contract volume on the CME was 15,687,056 and 7,629 contracts, respectively. For the same period, Japanese Yen options volume on the Phlx was 3,228 contracts. According to the Exchange, participants in the foreign exchange market have various reasons for participating. Multinational corporations and importers need foreign currency to acquire materials or goods from abroad. Banks and multinational corporations sometimes require specific wholesale funding for their commercial loan or other foreign investment portfolios. Some participants hedge open currency exposure through off-balance-sheet products. The Exchange further represents that the primary market participants in foreign exchange are banks (including government-controlled central banks), investment banks, money managers, multinational corporations and institutional investors. The most significant participants are the major international commercial banks that act both as brokers and as dealers. In their dealer role, these banks maintain long or short positions in a currency and seek to profit from changes in exchange rates. In their broker role, the banks handle buy and sell orders from commercial customers, such as multinational corporations. The banks earn commissions when acting as agent. They profit from the spread between the rates at which they buy and sell currency for customers when they act as principal. Typically, banks engage in transactions ranging from $5 million to $50 million in amount. Although banks will engage in smaller transactions, the fees that they charge have made the foreign currency markets relatively inaccessible to individual investors. Some banks allow individual investors to engage in spot trades without paying traditional commissions on the trades. Such trading is often not profitable for individual investors, however, because the banks charge the investor the spread between the bid and the ask price maintained by the bank on all purchases and sales. The overall effect of this fee structure depends on the spread maintained by the bank and the frequency with which the investor trades. Generally this fee structure is particularly disadvantageous to active traders. The Trust's assets will consist only of Japanese Yen on demand deposit in two Japanese Yen-denominated accounts at JPMorgan Chase Bank, N.A., London Branch; an interest-bearing primary deposit account and a non-interest bearing secondary account. The Trust will not hold any derivative products. Each Share represents a proportional interest, based on the total number of Shares outstanding, in the Japanese Yen owned by the Trust, plus accrued and unpaid interest less accrued but unpaid expenses (both asset-based and non-asset based) of the Trust. The Sponsor expects that the price of a Share will fluctuate in response to fluctuations in the price of the Japanese Yen and that the price of a Share will reflect accumulated interest as well as the estimated accrued but unpaid expenses of the Trust. Because the Shares will be traded on the NYSE, investors will be able to access the Japanese Yen foreign currency market through a traditional brokerage account which will provide investors with an efficient means of implementing investment tactics and strategies that involve Japanese Yen. Foreign Currency Regulation Most trading in the global over-the-counter
(OTC)foreign currency markets is conducted by regulated financial institutions such as banks and broker-dealers. In addition, in the United States, the Foreign Exchange Committee of the New York Federal Reserve Bank has issued Guidelines for Foreign Exchange Trading, and central-bank sponsored committees in Japan and Singapore have published similar best practice guidelines. In the United Kingdom, the Bank of England has published the Non-Investment Products Code, which covers foreign currency trading. The Financial Markets Association, whose members include major international banking organizations, has also established best practices guidelines called the Model Code. Participants in the U.S. OTC market for foreign currencies are generally regulated by their oversight regulators. For example, participating banks are regulated by the banking authorities. In addition, in the U.S., the SEC regulates trading of options on foreign currencies on the Phlx and the Commodity Futures Trading Commission (“CFTC”) regulates trading of futures, and options on futures on foreign currencies on regulated futures exchanges. 10 10 The CFTC is an independent government agency with the mandate to regulate commodity futures and options markets in the United States under the Commodity Exchange Act. In addition to its oversight of regulated futures exchanges, the CFTC has jurisdiction over certain foreign currency futures, and options on futures transactions occurring other than on a regulated exchange and involving retail customers. Both the SEC and CFTC have established rules designed to prevent market manipulation, abusive trading practices and fraud, as do the exchanges on which the foreign currency products trade. The Exchange states that the Phlx and CME have authority to perform surveillance on their members' trading activities, review positions held by members and large-scale customers, and monitor the price movements of options and/or futures markets by comparing them with cash and other derivative markets' prices. Foreign Exchange Markets 11 The Exchange represents that the average daily turnover of the USD in the foreign exchange market is approximately $1.57 trillion, which makes it the most-traded currency in the world, accounting for approximately 89% of global foreign exchange transactions. 11 The primary source of the statistical information in this section is the Bank of International Settlements Survey, note 7, supra. Other information came from the websites of the central banks for the applicable countries and other sources the Sponsor believes to be reliable. The Japanese Yen is the official currency of Japan and the currency of the Bank of Japan, the central bank of Japan. The average daily turnover in the foreign exchange markets is approximately $1.9 trillion. Japanese Yen was on one side of 20% of all currency transactions. The USD/Japanese Yen pair has an average daily turnover of approximately $296 billion, which makes it the second most traded currency pair, accounting for approximately 17% of global foreign exchange transactions. From the beginning of 2002 to the end of 2005, the Noon Buying Rate for Japanese Yen as reported by the Federal Reserve Bank of New York ranged from 102.50 on January 14, 2005 to 134.71 on February 8, 2002. As of November 20, 2006, the Noon Buying Rate for the Japanese Yen was 118.16. The Sponsor The Sponsor of the Trust is Rydex Specialized Products LLC, a Delaware limited liability company that is wholly-owned by PADCO Advisors II, Inc., a Maryland corporation, a privately-held company owned by Rydex Holdings, Inc., a Maryland Corporation, which is controlled by two irrevocable trusts. The Sponsor and its affiliates collectively do business as “Rydex Investments.” The Sponsor is responsible for establishing the Trust and for the registration of the Shares. The Sponsor generally oversees the performance of the Trustee and the Trust's principal service providers, but does not exercise day-to-day oversight over the Trustee or such service providers. The Sponsor regularly communicates with the Trustee to monitor the overall performance of the Trust. The Sponsor, with assistance and support from Rydex affiliates who also do business as “Rydex Investments,” the Trustee and outside professionals, are responsible for preparing and filing periodic reports on behalf of the Trust with the SEC. 12 The Sponsor will designate the auditors of the Trust and may from time to time employ legal counsel for the Trust. 12 The Sponsor has obtained a no-action letter from the SEC Division of Corporation Finance with respect to the Euro Currency Trust pursuant to which the Sponsor's principal executive officer and principal financial officer will provide any certifications that are required from a “registrant's” principal executive officer and principal financial officer. *See* No-Action Letter from Charles Kwon, Special Counsel, Division of Corporation Finance, Commission, dated March 22, 2006. The Sponsor will be requesting the same type of no-action ruling for the Trust. The Distributor is assisting the Sponsor in developing a marketing plan for the Trust, preparing marketing materials on the Shares, executing the marketing plan for the Trust and providing strategic and tactical research on the global foreign exchange markets. The Sponsor will not enter into an agreement with the Distributor covering these services, because the Distributor is an affiliate and will not be paid any compensation by the Sponsor for performing these services. The Sponsor with the Distributor's assistance maintains a public Web site on behalf of the Trust, *www.currencyshares.com,* which contains information about the Trust and the Shares, and oversees certain Shareholder services, such as a call center and prospectus delivery. The Sponsor may direct the Trustee in the conduct of its affairs, but only as provided in the Depositary Trust Agreement. For example, the Sponsor may direct the Trustee to sell Japanese Yen to pay certain extraordinary expenses, to suspend a redemption order, postpone a redemption settlement date, or to terminate the Trust if certain criteria are met. The Sponsor anticipates that, if the market capitalization of the Trust is less than $300 million for five consecutive trading days beginning after the first anniversary of the Trust's inception, then the Sponsor will, in accordance with the Depositary Trust Agreement, direct the Trustee to terminate and liquidate the Trust. The Sponsor's fee accrues daily at an annual nominal rate of 0.40% of the Japanese Yen in the Trust (including all unpaid interest but excluding unpaid fees, each as accrued through the immediately preceding day) and is paid monthly. The Trustee The Bank of New York, the Trustee, is generally responsible for the day-to-day administration of the Trust, including keeping the Trust's operational records. The Trustee's principal responsibilities include selling Japanese Yen held by the Trust if needed to pay the Trust's expenses, calculating the Net Asset Value (“NAV”) of the Trust and the NAV per Share, receiving and processing orders from Authorized Participants to create and redeem Baskets (as discussed below) and coordinating the processing of such orders with the Depository and DTC. The Trustee will earn a monthly fee that will be paid by the Sponsor. The Trustee intends to regularly communicate with the Sponsor to monitor the over-all performance of the Trust. The Trustee, along with the Sponsor, consults with the Trust's legal, accounting and other professional service providers as needed. The Trustee assists and supports the Sponsor with the preparation of all periodic reports required to be filed with the SEC on behalf of the Trust. Affiliates of the Trustee may from time to time act as Authorized Participants, purchase or sell foreign currency, or Shares for their own account. The Depository JPMorgan Chase Bank, N.A., London Branch (the “Bank”) is the Depository. The Depository accepts Japanese Yen deposited with it as a banker by Authorized Participants in connection with the creation of Baskets. The Depository facilitates the transfer of Japanese Yen into and out of the Trust through the primary and secondary deposit accounts maintained with it as a banker by the Trust. The Depository will pay interest on the primary deposit account. Interest on the primary deposit account accrues daily at an initial annual nominal rate of the Bank of Japan Overnight Call Rate minus 27 basis points, and is paid monthly. Each month the Depository will deposit into the secondary deposit account accrued but unpaid interest. The Depository will not be paid a fee for its services to the Trust. The Depository may earn a “spread” or “margin” over the rate of interest it pays to the Trust on the Japanese Yen deposit balances. The Depository is not a trustee for the Trust or the Shareholders. The Depository and its affiliates may from time to time act as Authorized Participants or purchase or sell Japanese Yen or Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion. The Distributor Rydex Distributors, Inc. is the Distributor. The Distributor is a registered broker-dealer with the SEC and is a member of NASD. The Distributor is assisting the Sponsor in developing a marketing plan for the Trust on an ongoing basis, preparing marketing materials regarding the Shares, including the content on the Trust's Web site, *www.currencyshares.com,* executing the marketing plan for the Trust, and providing strategic and tactical research on the global foreign exchange market. The Distributor and the Sponsor are affiliates of one another. There is no written agreement between them, and no compensation is paid by the Sponsor to the Distributor in connection with services performed by the Distributor for the Trust. Description of the Trust According to the Registration Statement for the Trust, the Trust will be formed under the laws of the State of New York as of the date the Sponsor and the Trustee sign the Depositary Trust Agreement and the Initial Purchaser makes the initial deposit for the issuance of three Baskets. A Basket is a block of 50,000 Shares. The Trust holds Japanese Yen 13 and is expected from time to time to issue Baskets in exchange for deposits of Japanese Yen and to distribute Japanese Yen in connection with redemptions of Baskets. The investment objective of the Trust is for the Shares to reflect the price USD of Japanese Yen. The Shares represent units of fractional undivided beneficial interest in, and ownership of, the Trust. The Trust is not managed like a business corporation or an active investment vehicle. Japanese Yen held by the Trust will only be sold:
(1)If needed to pay Trust expenses,
(2)in the event the Trust terminates and liquidates its assets or
(3)as otherwise required by law or regulation. The sale of Japanese Yen by the Trust is a taxable event to Shareholders. 13 The Exchange notes that, in addition to the CurrencyShares Trusts *(See* note 4, *supra* ), the Commission has previously permitted the listing of securities products for which the underlying was a commodity or otherwise was not a security trading on a regulated market. *See, e.g.* , Securities Exchange Act Release Nos. 54013 (June 16, 2006), 71 FR 36372 (June 26, 2006) (approving listing of iShares ® GSCI Commodity Indexed Trust); 50603 (October 28, 2004), 69 FR 64614 (November 5, 2004) (SR-NYSE-2004-22) (approving listing and trading on NYSE of StreetTRACKS ® Gold Shares); 19133 (October 14, 1982), 47 FR 46946 (October 21, 1982) (SR-Phlx-81-4) (approving the listing of standardized options on foreign currencies); 36505 (November 22, 1995), 60 FR 61277 (November 29, 1995) (SR-Phlx-95-42) (approving the listing of dollar-denominated delivery foreign currency options on the Japanese Yen); and 36165 (August 29, 1995), 60 FR 46653 (September 7, 1995) (SR-NYSE-94-41) (approving listing standards for, among other things, currency and currency index warrants). According to the Registration Statement, the Trust is not registered as an investment company under the Investment Company Act and is not required to register under such Act. The Trust's assets will consist only of Japanese Yen on demand deposit in two Japanese Yen-denominated accounts at JPMorgan Chase Bank, N.A., London Branch; an interest-bearing primary deposit account and a non-interest bearing secondary account. The Trust will not hold any derivative products. Each Share represents a proportional interest, based on the total number of Shares outstanding, in Japanese Yen owned by the Trust, plus accrued but unpaid interest, less the estimated accrued but unpaid expenses (both asset-based and non-asset based) of the Trust. The Sponsor expects that the price of a Share will fluctuate in response to fluctuations in the price of Japanese Yen and that the price of a Share will reflect accumulated interest as well as the estimated accrued but unpaid expenses of the Trust. Investors may obtain, 24 hours a day, foreign exchange pricing information based on the spot price of Japanese Yen from various financial information service providers. Current spot prices are also generally available with bid/ask spreads from foreign exchange dealers. In addition, the Trust's Web site will provide ongoing pricing information for Japanese Yen spot prices and the Shares. Market prices for the Shares are available from a variety of sources, including brokerage firms, financial information Web sites and other information service providers. One such Web site is hosted by Bloomberg, *http://www.bloomberg.com/markets/currencies/asiapac_currencies.html* , and it regularly reports current foreign exchange pricing information. The NAV of the Trust is published by the Sponsor on each day that the NYSE is open for regular trading and will be posted on the Trust's Web site. The Trust will terminate upon the occurrence of any of the termination events listed in the Depositary Trust Agreement and will otherwise terminate on February 1, 2047. The Sponsor, on behalf of the Trust, will rely on relief previously granted by the Division of Market Regulation 14 from certain trading requirements of the Act. 15 The Sponsor also intends to request guidance from the Commission on the application of the certification rules for quarterly and annual reports adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. In addition, the Trust will not be subject to the Exchange's corporate governance requirements, including the Exchange's audit committee requirements. 16 14 *See* letter from Racquel L. Russell, Branch Chief, SEC Division of Market Regulation, to George T. Simon, Foley & Lardner, dated June 21, 2006 (“June 21, 2006 letter”) (granting relief from certain rules under the Act for the CurrencyShares Trusts); letter from James A. Brigagliano, Assistant Director, SEC Division of Market Regulation to Michael Schmidtberger, Sidley, Austin, Brown & Wood, dated January 19, 2006 (“January 19, 2006 Letter”) (granting relief from certain rules under the Act for the DB Commodity Index Tracking Master Fund). The Sponsor is relying on the June 21, 2006 Letter regarding Rule 10a-1, Rule 200(g) of Regulation SHO, and Rules 101 and 102 of Regulation M under the Act, and is relying on the January 19, 2006 Letter regarding Section 11(d)(1) of the Act and Rule 11d1-2 thereunder. 15 *See infra* note 30. 16 *See* Securities Exchange Act Release No. 48745 (November 4, 2003), 68 FR 64154 (November 12, 2003) (SR-NYSE-2002-33, SR-NASD-2002-77, *et al.* ) (specifically noting that the corporate governance standards will not apply to, among others, passive business organizations in the form of trusts). *See also* Securities Exchange Act Release No. 47654 (April 25, 2003), 68 FR 18787 (April 16, 2003) (noting in Section II(F)(3)(c) that “SROs may exclude from Exchange Act Rule 10A-3's requirements issuers that are organized as trusts or other unincorporated associations that do not have a board of directors or persons acting in a similar capacity and whose activities are limited to passively owning or holding (as well as administering and distributing amounts in respect of) securities, rights, collateral or other assets on behalf of or for the benefit of the holders of the listed securities.”) Trust's Expenses The Trust's only ordinary recurring expense is expected to be the Sponsor's fee. The Sponsor is obligated under the Depositary Trust Agreement to pay the following administrative and marketing expenses for the Trust: the Trustee's monthly fee, the Distributor's fee, NYSE listing fees, SEC registration fees, printing and mailing costs, audit fees and expenses and up to $100,000 per annum in legal fees and expenses. The Sponsor is also obligated to pay the costs of the Trust's organization and the costs of the initial sale of the Shares, including the applicable SEC registration fees. The Sponsor's fee accrues daily at an annual nominal rate of 0.40% of the Japanese Yen in the Trust. Each month, the Trust will first withdraw Japanese Yen the Trust has earned as interest to pay the Sponsor's fee and any other Trust expenses that have been incurred. If that interest is not sufficient to fully pay the Sponsor's fee and Trust expenses, then the Trustee will withdraw Japanese Yen from the primary deposit account as needed. If the Trust incurs expenses in USD (which is not anticipated), Japanese Yen will be converted to USD at the prevailing market rate at the time of conversion to pay expenses. In certain exceptional cases the following expenses may be charged to the Trust in addition to the Sponsor's fee:
(1)Expenses and costs of any extraordinary services performed by the Trustee or the Sponsor on behalf of the Trust or action taken by the Trustee or the Sponsor to protect the Trust or interests of Shareholders;
(2)indemnification of the Sponsor;
(3)taxes and other governmental charges; and
(4)expenses of the Trust other than those the Sponsor is obligated to pay pursuant to the Depositary Trust Agreement, including legal fees and expenses over $100,000. If these additional expenses are incurred, the Trust will be required to pay these expenses by withdrawing deposited Japanese Yen and the amount of Japanese Yen represented by a Share will decline at such time. Accordingly, the Shareholders will effectively bear the cost of these other expenses, if incurred. In order to pay the Trust's expenses, the Trustee will first withdraw Japanese Yen the Trust has earned as interest. In the event the Sponsor's fee and any other Trust expenses exceed the interest earned, additional Japanese Yen will be withdrawn from the primary deposit account as required to cover the expenses. For expenses not payable in Japanese Yen, the Trustee will direct that Japanese Yen be converted to USD as necessary for the Trustee to pay the Trust's expenses. The Trustee will direct that the smallest amount of Japanese Yen required to purchase amounts of U.S. Dollars sufficient to pay Trust expenses and the costs of currency conversion be withdrawn from the Trust. Liquidity The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by non-concurrent trading hours between the major foreign currency markets and the NYSE. The period of greatest liquidity in the Japanese Yen market is typically that time of the day when trading in the European time zones or Japan overlaps with trading in the United States, which is when OTC market trading in London, New York, and other centers coincides with futures and options trading on those currencies. While the Shares will trade on the NYSE until 4:15 p.m. (New York time), liquidity in the OTC market for the Japanese Yen will be slightly reduced after the close of the London foreign currency markets and before the opening of the Tokyo foreign currency market. Because of the potential for arbitrage inherent in the structure of the Trust, the Sponsor believes that the Shares will not trade at a material discount or premium to the value of underlying currency held by the Trust. The arbitrage process, which in general provides investors the opportunity to profit from differences in prices of assets, increases the efficiency of the markets, serves to prevent potentially manipulative efforts and can be expected to operate efficiently in the case of the Shares and Japanese Yen. If the price of the Shares deviates enough from the price of Japanese Yen to create a material discount or premium, an arbitrage opportunity is created. If the Shares are inexpensive compared to Japanese Yen, an Authorized Participant, either on its own behalf or acting as agent for investors, arbitrageurs or traders, may buy the Shares at a discount, immediately redeem them in exchange for Japanese Yen and sell Japanese Yen in the cash market at a profit. If the Shares are expensive compared to Japanese Yen that underlies them, an Authorized Participant may sell the Shares short, buy enough Japanese Yen to create the number of Shares sold short, acquire the Shares through the creation process and deliver the Shares to close out the short position. 17 In both instances the arbitrageur serves efficiently to correct price discrepancies between the Shares and Japanese Yen. 17 The Exchange notes that the Trust, which will only hold Japanese Yen as an asset in the normal course of its operations, differs from index-based exchange-traded funds, which may involve a trust holding hundreds or even thousands of underlying component securities, necessarily involving in the arbitrage process movements in a large number of security positions. *See, e.g.* , Securities Exchange Act Release No. 46306 (August 2, 2002), 67 FR 51916 (August 9, 2002) (SR-NYSE-2002-28) (approving the UTP trading of Vanguard Total Market VIPERs based on the Wilshire 5000 Total Market Index). Description of the Shares According to the Registration Statement, the Shares are not a traditional investment. They are dissimilar from the “shares” of a corporation operating a business enterprise, with management and a board of directors. Trust Shareholders do not have rights normally associated with owning shares of a business corporation, including, for example, the right to bring “oppression” or “derivative” actions. Shareholders have only those rights explicitly set forth in the Depositary Trust Agreement. All Shares are of the same class with equal rights and privileges. Each Share is transferable, is fully paid and non-assessable and entitles the holder to vote on the limited matters upon which Shareholders may vote under the Depositary Trust Agreement. The Shares do not entitle their holders to any conversion or pre-emptive rights or, except as provided in the Registration Statement, any redemption or distribution rights. Distributions Each month the Depository will deposit into the secondary deposit account accrued but unpaid interest and the Trustee will withdraw Japanese Yen from the secondary deposit account to pay the accrued Sponsor's fee for the previous month plus other Trust expenses, if any. In the event the Sponsor's fee and any other Trust expenses exceed the interest earned on the primary deposit account, additional Japanese Yen will be withdrawn from the primary deposit account as required to cover the expenses. In the event that the interest deposited exceeds the sum of the Sponsor's fee for the prior month plus other Trust expenses, if any, then the Trustee will direct that the excess be converted into U.S. Dollars at a prevailing market rate and the Trustee will distribute the U.S. Dollars as promptly as practicable to Shareholders on a pro rata basis (in accordance with the number of Shares that they own). Fees and Expenses Under the Deposit Account Agreement, the Depository is entitled to invoice the Trustee or debit the secondary deposit account for out-of-pocket expenses. The Trust has also agreed to reimburse the Depository for any taxes, levies, imposts, deductions, charges, stamp, transaction and other duties and withholdings in connection with the Deposit Accounts, except for such items imposed on the overall net income of the Depository. Except for the reimbursable expenses just described, the Depository will not be paid a fee for its services to the Trust. The Depository may earn a “spread” or “margin” on the Japanese Yen deposit balances it holds. Voting and Approvals Shareholders have no voting rights under the Depositary Trust Agreement, except in limited circumstances. If the holders of at least 25% of the Shares outstanding for the Trust determine that the Trustee is in material breach of its obligations under the Depositary Trust Agreement, they may provide written notice to the Trustee (or require the Sponsor to do so) specifying the default and requiring the Trustee to cure such default. If the Trustee fails to cure such breach within 30 days after receipt of the notice, the Sponsor, acting on behalf of the Registered Owners, may remove the Trustee for the Trust. The holders of at least 66 2/3 % of the Shares outstanding may vote to remove the Trustee. The Trustee must terminate the Trust at the request of the holders of at least 75% of the outstanding Shares. Book-Entry Form The Sponsor and the Trustee will apply to DTC for acceptance of the Shares in its book-entry settlement system. If the Shares are eligible for book-entry settlement, all Shares will be evidenced by global certificates issued by the Trustee to DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates will evidence all of the Shares outstanding at any time. In order to transfer Shares through DTC, Shareholders must be DTC Participants. The Shares will be transferable only through the book-entry system of DTC. A Shareholder that is not a DTC Participant will be able to transfer its Shares through DTC by instructing the DTC Participant holding its Shares. Transfers will be made in accordance with standard securities industry practice. Issuance of the Shares The Trust creates and redeems Shares in Baskets on a continuous basis. A Basket is a block of 50,000 Shares. The creation and redemption of Baskets requires the delivery to the Trust or the distribution by the Trust of the amount of Japanese Yen represented by the Baskets being created or redeemed. This amount is based on the combined NAV per Share of the number of Shares included in the Baskets being created or redeemed, determined on the day the order to create or redeem Baskets is accepted by the Trustee. Authorized Participants are the only persons that may place orders to create and redeem Baskets. An Authorized Participant is a DTC Participant that is a registered broker-dealer or other securities market participant such as a bank or other financial institution that is not required to register as a broker-dealer to engage in securities transactions and has entered into a Participant Agreement with the Trustee. Only Authorized Participants may place orders to create or redeem Baskets. Before initiating a creation or redemption order, an Authorized Participant must have entered into a Participant Agreement with the Sponsor and the Trustee. The Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of foreign currency required for creations and redemptions. The Participant Agreements may be amended by the Trustee, the Sponsor and the relevant Authorized Participant. Authorized Participants pay a transaction fee of $500 to the Trustee for each order that they place to create or redeem one or more Baskets. Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from either the Sponsor or the Trust. No Authorized Participant has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares. Certain Authorized Participants are expected to have the facility to participate directly in the global foreign exchange market. In some cases, an Authorized Participant may acquire foreign currency from, or sell foreign currency to, an affiliated foreign exchange trading desk, which may profit in these instances. The Sponsor believes that the size and operation of the foreign exchange market make it unlikely that an Authorized Participant's direct activities in the foreign exchange and securities markets will impact the price of Japanese Yen or the price of Shares. Each Authorized Participant will be registered as a broker-dealer under the Act and will be regulated by the National Association of Securities Dealers, Inc., or else will be exempt from being (or otherwise will not be required to be) so registered or regulated, and will be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants may be regulated under federal and state banking laws and regulations. Each Authorized Participant will have its own set of rules and procedures, internal controls and information barriers as it determines to be appropriate in light of its own regulatory regime. Authorized Participants may act for their own accounts or as agents for broker-dealers, depositaries and other securities or foreign currency market participants that wish to create or redeem Baskets. An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple clients. Creation and Redemption In order to create a Basket, the Authorized Participant deposits the applicable Basket Amount with the Depository and orders Shares from the Trustee. 18 The Trustee directs DTC to credit Shares to the Authorized Participant. The Authorized Participant will then be able to sell Shares to Purchasers on the NYSE or any other market in which the Shares may trade. 18 The Trustee shall determine the Basket Amount “as promptly as practicable” after the Federal Reserve Bank of New York announces the Noon Buying Rate on each day that the NYSE is open for regular trading. Ordinarily, this will occur by 2 p.m. (New York time). The Basket Amount will be published on the Trust's Web site every day the NYSE is open for regular trading. The Registration Statement, the Participant Agreement and the Trust Agreement do not state a precise time each day for publication of the Basket Amount. It will be published simultaneously with the NAV. The Sponsor for the Trust has represented to the Exchange that the NAV and the Basket Amount for the Trust will be available to all market participants at the same time. On any business day, an Authorized Participant may place an order with the Trustee to create one or more Baskets. The creation or redemption of Shares can occur only in a Basket of 50,000 Shares or multiples thereof. For purposes of processing both purchase and redemption orders, a “business day” means any day other than a day when the NYSE is closed for regular trading. Purchase orders placed by 4:00 p.m. (New York time) on a business day will have that date as the purchase order date. By placing a purchase order, an Authorized Participant agrees to deposit Japanese Yen with the Trust. Before the delivery of Baskets for a purchase order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the purchase order. The total deposit required to create each Basket, called the Basket Amount, is an amount of Japanese Yen bearing the same proportion to the number of Baskets to be created as the total assets of the Trust (net of estimated accrued but unpaid expenses) bears to the total number of Baskets outstanding on the date that the order to purchase is properly received. The amount of the required deposit is determined by dividing the number of units of Japanese Yen held by the Trust (net of estimated accrued but unpaid expenses) by the number of Baskets outstanding. All questions as to the composition of a Basket Amount are finally determined by the Trustee. The Trustee's determination of the Basket Amount shall be final and binding on all persons interested in the Trust. An Authorized Participant who places a purchase order is responsible for delivering the Basket Amount to the Trust's primary deposit account with the Depository as directed in the Authorized Participant's Participant Agreement. Authorized Participants will use the SWIFT system to make timely deposits through their bank correspondents in London. Upon receipt of a Japanese Yen deposit from an Authorized Participant, the Trustee will direct DTC to credit the number of Baskets ordered to the Authorized Participant's DTC account. The expense and risk of delivery, ownership and safekeeping of Japanese Yen until such currency has been received by the Depository shall be borne solely by the Authorized Participant. In order to redeem Shares, an Authorized Participant must send the Trustee a Redemption Order specifying the number of Baskets that the Authorized Participant wishes to redeem. The Trustee then instructs the Depository to send the Authorized Participant the Japanese Yen and directs DTC to cancel the Authorized Participant's Shares that were redeemed. The procedures by which an Authorized Participant can redeem one or more Baskets mirror the procedures for the creation of Baskets. On any business day, an Authorized Participant may place an order with the Trustee to redeem one or more Baskets. Redemption orders must be placed by 4 p.m. (New York time) on a business day. A redemption order so received will have that day as the order redemption date and will normally be effective on the date it is received in satisfactory form by the Trustee. The redemption procedures allow Authorized Participants to redeem Baskets and do not entitle an individual Shareholder to redeem any Shares in an amount less than a Basket or to redeem Baskets other than through an Authorized Participant. By placing a redemption order, an Authorized Participant agrees to deliver the Baskets to be redeemed through DTC's book-entry system to the Depository as directed in the Authorized Participant's Participant Agreement. Before the delivery of the redemption distribution for a redemption order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the redemption order. Determination of Redemption Distribution The redemption distribution from the Trust is a wire transfer, to an account of the redeeming Authorized Participant identified by the Authorized Participant, in the amount of Japanese Yen held by the Trust evidenced by the Shares being redeemed, giving effect to all estimated accrued but unpaid interest and expenses. Redemption distributions are subject to the deduction of any applicable tax or other governmental charges that may be due. 19 All questions as to the amount of a redemption distribution are finally determined by the Trustee. The Trustee's determination of the amount shall be final and binding on all persons interested in the Trust. 19 Authorized Participants are responsible for any transfer tax, sales or use tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant, and agree to indemnify the Sponsor, the Trustee and the Trust if they are required by law to pay any such tax, together with any applicable penalties, additions to tax or interest thereon. Delivery of Redemption Distribution The redemption distribution due from the Trust is delivered to the Authorized Participant as directed in the Authorized Participant's Participant Agreement. The Depository wires the redemption amount from the Deposit Account to an account of the redeeming Authorized Participant identified by the Authorized Participant. The Authorized Participant and the Trust are each at risk in respect of Japanese Yen credited to their respective accounts in the event of the Depository's insolvency. The Trustee will reject a redemption order if the order is not in proper form as described in the Participant Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful. Valuation of Japanese Yen, Definition of Net Asset Value and Adjusted Net Asset Value The Trustee will calculate, and the Sponsor will publish, the Trust's NAV each business day. To calculate the NAV, the Trustee will add to the amount of Japanese Yen in the Trust at the end of the preceding day accrued but unpaid interest, Japanese Yen receivable under pending purchase orders and the value of other Trust assets, and will subtract the accrued but unpaid Sponsor's fee, Japanese Yen payable under pending redemption orders and other Trust expenses and liabilities, if any. The result is the NAV of the Trust for that business day. The Trustee shall also divide the NAV of the Trust by the number of Shares outstanding for the date of the evaluation then being made, which figure is the “NAV per Share.” The NAV will be expressed in USD based on the Noon Buying Rate as determined by the Federal Reserve Bank of New York. If, on a particular evaluation day, the Noon Buying Rate has not been determined and announced by 2 p.m. (New York time), then the most recent Federal Reserve Bank of New York determination of the Noon Buying Rate shall be used to determine the NAV of the Trust unless the Trustee, in consultation with the Sponsor, determines that such price is inappropriate to use as the basis for such valuation. In the event that the Trustee and the Sponsor determine that the most recent Federal Reserve Bank of New York determination of the Noon Buying Rate is not an appropriate basis for valuation of the Trust's Japanese Yen, they shall determine an alternative basis for such evaluation to be employed by the Trustee. Such an alternative basis may include reference to other exchange traded securities that reflect the value of the Japanese Yen relative to the USD. The use of any alternative basis to determine NAV would be disclosed on the Trust's Web site. The Trustee also determines the NAV per Share, which equals the NAV of the Trust divided by the number of outstanding Shares. The Sponsor will publish the NAV and NAV per Share on each day that the NYSE is open for regular trading on the Trust's Web site, *www.currencyshares.com.* Clearance and Settlement The Sponsor and the Trustee will apply to DTC for acceptance of the Shares in its book-entry settlement system. If the Shares are eligible for book-entry settlement, all Shares will be evidenced by one or more global certificates that the Trustee will issue to DTC. The Shares will be available only in book-entry form. Shareholders may hold their Shares through DTC, if they are DTC Participants, or through Authorized Participants or Indirect Participants. If the Shares are eligible for book-entry settlement, individual certificates will not be issued for the Shares. Instead, global certificates will be signed by the Trustee and the Sponsor on behalf of the Trust, registered in the name of Cede & Co., as nominee for DTC, and deposited with the Trustee on behalf of DTC. The representations, undertakings and agreements made on the part of the Trust in the global certificates will be made and intended for the purpose of binding only the Trust and not the Trustee or the Sponsor individually. Upon the settlement date of any creation, transfer or redemption of Shares, DTC will credit or debit, on its book-entry registration and transfer system, the amount of the Shares so created, transferred or redeemed to the accounts of the appropriate DTC Participants. The Trustee and the Authorized Participants will designate the accounts to be credited and charged in the case of creation or redemption of Shares. Beneficial ownership of the Shares is limited to DTC Participants, Indirect Participants and persons holding interests through DTC Participants and Indirect Participants. Ownership of beneficial interests in the Shares will be shown on, and the transfer of ownership will be effected only through, records maintained by DTC (with respect to DTC Participants), the records of DTC Participants (with respect to Indirect Participants) and the records of Indirect Participants (with respect to Shareholders that are not DTC Participants or Indirect Participants). A Shareholder is expected to receive from or through the DTC Participant maintaining the account through which the Shareholder purchased its Shares a written confirmation relating to the purchase. DTC may discontinue providing its service with respect to Baskets or the Shares (or both) by giving notice to the Trustee and the Sponsor. Under such circumstances, the Trustee and the Sponsor would either find a replacement for DTC to perform its functions at a comparable cost or, if a replacement is unavailable, terminate the Trust. Risk Factors To Investing in the Shares An investment in the Shares carries certain risks. The following risk factors are taken from and discussed in more detail in the Registration Statement: • The value of the Shares relates directly to the value of the Japanese Yen held by the Trust. Fluctuations in the price of Japanese Yen could materially and adversely affect the value of the Shares. • The Japanese Yen/USD exchange rate, like foreign exchange rates in general, can be volatile and difficult to predict. This volatility could materially and adversely affect the performance of the Shares. • If interest earned by the Trust does not exceed expenses, the Trustee will withdraw Japanese Yen from the Trust to pay these excess expenses which will reduce the amount of Japanese Yen represented by each Share on an ongoing basis. • If the Trust incurs expenses in USD, the Trust would be required to sell Japanese Yen to pay these expenses. The sale of the Trust's Japanese Yen to pay expenses in USD at a time of low Japanese Yen prices could adversely affect the value of the Shares. • Purchasing activity in the Japanese Yen market associated with the purchase of Baskets from the Trust may cause a temporary increase in the price of Japanese Yen. This increase may adversely affect an investment in the Shares. • The Deposit Accounts are not entitled to payment at any office of JP Morgan Chase Bank, N.A. located in the United States. • Shareholders will not have the protections associated with ownership of a demand deposit account insured in the United States by the Federal Deposit Insurance Corporation or the protection provided under English law. Japanese Yen deposited in the Deposit Accounts by an Authorized Participant will be commingled with Japanese Yen deposited by other Authorized Participants and will be held by the Depository in either the primary deposit account or the secondary deposit account of the Trust. Japanese Yen held in the Deposit Accounts will not be segregated from the Depository's other assets. If the Depository becomes insolvent, then its assets might not be adequate to satisfy a claim by the Trust or any Authorized Participant. In addition, in the event of the insolvency of the Depository or the U.S. bank of which it is a branch, there may be a delay and costs incurred in recovering the Japanese Yen held in the Deposit Accounts. • The Shares are a new securities product. Their value could decrease if unanticipated operational or trading problems were to arise. • Shareholders will not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act of 1940. • Shareholders will not have the rights enjoyed by investors in certain other financial instruments. • The Shares may trade at a price that is at, above, or below the NAV per Share. • The interest rate earned by the Trust, although competitive, may not be the best rate available. If the Sponsor determines that the interest rate is inadequate, then its sole recourse will be to remove the Depositary and terminate the Deposit Accounts. • The Depository owes no fiduciary duties to the Trust or the Shareholders, is not required to act in their best interest and could resign or be removed by the Sponsor with respect to the Trust, triggering early termination of the Trust. • Shareholders may incur significant fees upon the termination of the Trust. • Redemption orders are subject to rejection by the Trustee under certain circumstances. • Substantial sales of Japanese Yen by the official sector could adversely affect an investment in the Shares. • Shareholders that are not Authorized Participants may only purchase or sell their Shares in secondary trading markets. • The liability of the Sponsor and the Trustee under the Depositary Trust Agreement is limited; and, except as set forth in the Depositary Trust Agreement, they are not obligated to prosecute any action, suit or other proceeding in respect to any Trust property. • The Depositary Trust Agreement may be amended to the detriment of Shareholders without their consent. • The License Agreement with the Bank of New York may be terminated by the Bank of New York in the event of a material breach by the Sponsor. Termination of the License Agreement might lead to early termination and liquidation of the Trust. Availability of Information Regarding Foreign Currency Prices Currently, the Consolidated Tape Plan does not provide for dissemination of the spot price of a foreign currency over the Consolidated Tape. However, there will be disseminated over the Consolidated Tape the last sale price for the Shares, as is the case for all equity securities traded on the Exchange (including exchange-traded funds). In addition, there is a considerable amount of foreign currency price and market information available on public Web sites and through professional and subscription services. As is the case with equity securities generally and exchange-traded funds specifically, in most instances, real-time information is only available for a fee, and information available free of charge is subject to delay (typically, 15 to 20 minutes). Investors may obtain on a 24-hour basis foreign currency pricing information based on the foreign currency spot price of each applicable foreign currency from various financial information service providers. Complete real-time data for foreign currency futures and options prices traded on the CME and Phlx are also available by subscription from information service providers. The CME and Phlx also provide delayed futures and options information on current and past trading sessions and market news free of charge on their respective Web sites. There are a variety of other public Web sites available at no charge that provide information on the Japanese Yen and other foreign currencies underlying CurrencyShares, which service providers include Bloomberg, ( *http://www.bloomberg.com/markets/currencies/fxc.html* ), CBS Market Watch ( *www.marketwatch.com/tools/stockresearch/globalmarkets* ), Yahoo! Finance ( *www.finance.yahoo.com/currency* ), moneycentral.com, cnnfn.com and reuters.com, which provide spot price or currency conversion information about the Japanese Yen and other currencies. Many of these sites offer price quotations drawn from other published sources, and as the information is supplied free of charge, it generally is subject to time delays. In addition, major market data vendors regularly report current currency exchange pricing for a fee for the Japanese Yen and other currencies. 20 Like bond securities traded in the OTC market with respect to which pricing information is available directly from bond dealers, current foreign currency spot prices are also generally available with bid/ask spreads from foreign currency dealers. 21 20 There may be incremental differences in the Japanese Yen spot price among the various information service sources. While the Exchange believes the differences in the Japanese Yen spot price may be relevant to those entities engaging in arbitrage or in the active daily trading of Japanese Yen or derivatives thereon, the Exchange believes such differences are likely of less concern to individual investors intending to hold the Shares as part of a long-term investment strategy. 21 *See, e.g.* , Securities Exchange Act Release No. 46252 (July 24, 2002), 67 FR 49715 (July 31, 2002) (SR-Amex-2001-35) (noting that quote and trade information regarding debt securities is widely available to market participants from a variety of sources, including broker-dealers, information service providers, newspapers and Web sites). In addition, the Trust's Web site will provide the following information:
(1)The spot price for Japanese Yen, 22 including the bid and offer and the midpoint between the bid and offer for the Japanese Yen spot price, updated every 5 to 10 seconds, 23 which is an essentially real-time basis;
(2)an intraday indicative value (“IIV”) per share for the Shares calculated by multiplying the indicative spot price of the Japanese Yen by the quantity of Japanese Yen backing each Share, updated at least every 15 seconds; 24
(3)a delayed indicative value (subject to a 20 minute delay), which is used for calculating premium/discount information;
(4)premium/discount information, calculated on a 20 minute delayed basis;
(5)the NAV of the Trust as calculated each business day by the Trustee;
(6)accrued interest per Share;
(7)the daily Federal Reserve Bank of New York Noon Buying Rate;
(8)the Basket Amount for the Japanese Yen; and
(9)the last sale price of the Shares as traded in the U.S. market, subject to a 20-minute delay, as it is provided free of charge. 25 The Exchange will provide on its own public Web site ( *www.nyse.com* ) a link to the Trust's Web site. 22 The Trust's website's foreign currency spot price will be provided by FactSet Research Systems ( *www.factset.com* ). The NYSE will provide a link to the Trust's website. FactSet Research Systems is not affiliated with the Trust, Trustee, Sponsor, Depository, Distributor or the Exchange. In the event that the Trust's website should cease to provide this foreign currency spot price information from an unaffiliated source and the intraday indicative value of the Shares, the NYSE will commence delisting proceedings for the Shares. 23 The midpoint will be calculated by the Sponsor. The midpoint is used for purposes of calculating the premium or discount of the Shares. For example, assuming a Japanese Yen spot bid of $.0086 and an offer of $.0087, the mid point would be calculated as follows: (Japanese Yen spot bid plus ((spot offer minus spot bid) divided by 2)) or ($.0086 + ($.0087 − $.0086/2)) = $.00865. 24 The intraday indicative value of the Shares is analogous to the intraday optimized portfolio value (sometimes referred to as the IOPV), indicative portfolio value and the intraday indicative value (sometimes referred to as the IIV) associated with the trading of exchange-traded funds. *See, e.g.* , Securities Exchange Act Release No. 46686 (October 18, 2002), 67 FR 65388 (October 24, 2002) (SR-NYSE-2002-51) for a discussion of indicative portfolio value in the context of an exchange-traded fund. 25 The last sale price of the Shares in the secondary market is available on a real-time basis for a fee from regular data vendors. Other Characteristics of the Shares Set forth below is a table that shows the initial number of currency units per Share, the number of Shares per Basket and the number of currency units per Basket: Trust name Currency units per share Shares per basket Currency units per basket CurrencyShares Japanese Yen Trust 10,000 50,000 500,000,000 For the Trust, a minimum of three Baskets, representing 150,000 Shares, will be outstanding at the commencement of trading on the Exchange. Trading in Shares on the Exchange will be effected normally until 4:15 p.m. each business day. The minimum trading increment for Shares on the Exchange will be $0.01. Listing Fees The Exchange original listing fee applicable to the listing of the Trust will be $5,000. The annual continued listing fee for the Trust will be $2,000. Continued Listing Criteria Under the applicable continued listing criteria, the Exchange will commence delisting proceedings with respect to Shares of the Trust as follows:
(1)Following the initial twelve-month period beginning upon the commencement of trading of the Shares, there are fewer than 50 record and/or beneficial holders of the Shares for 30 or more consecutive trading days;
(2)the value of the Japanese Yen is no longer calculated or available on at least a 15-second delayed basis from a source unaffiliated with the Sponsor, the Trust, the Trustee, or the Exchange or the Exchange stops providing a hyperlink on the Exchange's Web site to any such unaffiliated foreign currency value;
(3)the IIV is no longer made available on at least a 15-second delayed basis; or
(4)such other event shall occur or condition exist that, in the opinion of the Exchange, makes further dealings on the Exchange inadvisable. In addition, the Exchange will remove Shares from listing and trading upon termination of the Trust. Exchange Trading Rules and Policies The Shares are considered “securities” pursuant to NYSE Rule 3 and are subject to all applicable trading rules. Trading in the Shares will be subject to all provisions of Rules 1300A *et seq.* 26 The Exchange does not currently exempt Currency Trust Shares from the Exchange's “Market-on-Close/Limit-on-Close/Pre-Opening Price Indications” Policy, although the Exchange may do so by means of a rule change in the future if, after having experience with the trading of the Shares, the Exchange believes such an exemption is appropriate. 26 In particular, Rule 1300A provides that Rule 105(m) is deemed to prohibit an equity specialist, his member organization, other member, allied member or approved person in such member organization or officer or employee thereof from acting as a market maker or functioning in any capacity involving market-making responsibilities in the applicable non-U.S. currency, options, futures or options on futures on such currency, or any other derivatives based on such currency, except as otherwise provided therein. The Exchange has adopted Rule 1301A (“Currency Trust Shares: Securities Accounts and Orders of Specialists”) to ensure that specialists handling Currency Trust Shares provide the Exchange with all necessary information relating to their trading in the applicable non-U.S. currency, options, futures contracts and options thereon or any other derivative on such currency. 27 As a general matter, the Exchange has regulatory jurisdiction over its member organizations and any person or entity controlling a member organization. The Exchange also has regulatory jurisdiction over a subsidiary or affiliate of a member organization that is in the securities business. A member organization subsidiary or affiliate that does business only in commodities would not be subject to NYSE jurisdiction, but the Exchange could obtain certain information regarding the activities of such subsidiary or affiliate through reciprocal agreements with regulatory organizations that are members or affiliates of the Intermarket Surveillance Group (“ISG”) of which such subsidiary or affiliate is a member. 27 Rule 1301A also states that, in connection with trading the applicable non-U.S. currency, options, futures or options on futures or any other derivatives on such currency (including Currency Trust Shares), the specialist shall not use any material nonpublic information received from any person associated with a member or employee of such person regarding trading by such person or employee in the applicable non-U.S. currency, options, futures or options on futures, or any other derivatives on such currency. For purposes of Rule 1301A, “person associated with a member” shall have the same meaning ascribed to it in section 3(a)(21) of the Act. Surveillance The Exchange's surveillance procedures will be comparable to those used for Investment Company Units, and streetTRACKS ® Gold Shares and the currently-traded CurrencyShares Trusts and will incorporate and rely upon existing NYSE surveillance procedures governing equities. The Exchange believes that these procedures are adequate to monitor Exchange trading of the Shares, to detect violations of Exchange rules, consequently deterring manipulation. 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 the Shares, foreign currency options and foreign currency futures, including Japanese Yen options and futures, through NYSE members, in connection with such members' proprietary or customer trades which they effect 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. Specifically, the NYSE can obtain such information from the Phlx in connection with Japanese Yen options trading on the Phlx and from the CME in connection with Japanese Yen futures trading on those exchanges. 28 28 Phlx is a member of ISG. CME is an affiliate member of ISG. The Exchange's surveillance procedures will be comparable to those used for investment company units currently trading on the Exchange and will incorporate and rely upon existing NYSE surveillance procedures governing equities. Trading Halts With respect to trading halts, the Exchange may consider all relevant factors in exercising its discretion to halt or suspend trading in the Shares. Trading on the Exchange in the Shares may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable. These may include
(1)the extent to which trading is not occurring in Japanese Yen or
(2)whether other unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present. In addition, trading in Shares is subject to trading halts caused by extraordinary market volatility pursuant to Exchange's “circuit breaker” rule. 29 If the value of Japanese Yen updated at least every 15 seconds from a source not affiliated with the Sponsor, Trust or the Exchange; or
(2)the IIV per Share updated every 15 seconds is not being disseminated, the Exchange may halt trading during the day in which the interruption to such dissemination occurs. If the interruption to the dissemination of the value of the Japanese Yen or the IIV persists past the trading day in which it occurred, the Exchange will halt trading no later than the beginning of the trading day following the interruption. 29 NYSE Rule 80B. Due Diligence Before a member, member organization, allied member or employee thereof recommends a transaction in the Shares, such person must exercise due diligence to learn the essential facts relative to the customer pursuant to Exchange Rule 405, and must determine that the recommendation complies with all other applicable Exchange and Federal rules and regulations. A person making such recommendation should have a reasonable basis for believing, at the time of making the recommendation, that the customer has sufficient knowledge and experience in financial matters that he or she may reasonably be expected to be capable of evaluating the risks and any special characteristics of the recommended transaction, and is financially able to bear the risks of the recommended transaction. Information Memo The Exchange will distribute an Information Memo to its members in connection with the trading in the Shares. The Memo will discuss the special characteristics and risks of trading this type of security. Specifically, the Memo, among other things, will discuss what the Shares are, that Shares are not individually redeemable but are redeemable only in Baskets of 50,000 shares or multiples thereof, how a Basket is created and redeemed, applicable Exchange rules, the indicative price of Japanese Yen and IIV, dissemination information, trading information and the applicability of suitability rules. 30 The Information Memo will also state that the number of units Japanese Yen required to create a Basket or to be delivered upon redemption of a Basket may gradually decrease over time in the event that the Trust is required to withdraw or sell units of foreign currency to pay the Trust's expenses. The Memo also will reference that the Trust is subject to various fees and expenses described in the Registration Statement. The Memo also will reference the fact that there is no regulated source of last sale information regarding foreign currency, and that the Commission has no jurisdiction over the trading of foreign currency. Finally, the Memo also will note to members language in the Registration Statement regarding prospectus delivery requirements for the Shares. 30 The Information Memo will discuss exemptive relief granted by the Commission from certain rules under the Act. *See* note 14, *supra.* 2. Statutory Basis The basis under the Act for this proposed rule change, as amended, is the requirement under section 6(b)(5) of the Act 31 that an Exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, 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. 31 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 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, 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 e-mail to *rule-comments@sec.gov.* Please include File Number SR-NYSE-2007-03 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSE-2007-03. 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 will also 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-2007-03 and should be submitted by March 13, 2007. IV. Commission Findings and Order Granting Accelerated Approval of a Proposed Rule Change After careful consideration, the Commission finds that the proposed rule change, as amended, is consistent with the requirements of the Act 32 and the rules and regulations thereunder applicable to a national securities exchange. 33 In particular, the Commission finds that the proposed rule change, as amended, is consistent with the requirements of Section 6(b)(5) of the Act, 34 which requires, among other things, that the Exchange's rules be designed to promote just and equitable principles of trade, to remove impediments and to perfect the mechanism of a free and open market and a national market system, and in general, to protect investors and the public interest. 32 15 U.S.C. 78f. 33 In approving this proposed rule change, the Commission notes that it has considered the proposed rule's impact on efficiency, competition, and capital formation. *See* U.S.C. 78c(f). 34 15 U.S.C. 78f(b)(5). A. Surveillance The Commission finds that the proposed rule change provides the NYSE with the tools necessary to monitor trading in the Shares and is designed to prevent fraudulent and manipulative acts and practices. Information sharing agreements with markets trading securities underlying a derivative, or primary markets trading derivatives on the same underlying instruments, are an important part of a self-regulatory organization's ability to monitor for trading abuses in derivative products. 35 Although an information sharing agreement is not possible with the OTC foreign exchange market, the Commission believes that the Exchange's comprehensive surveillance sharing agreements with the Phlx and CME, by virtue of their memberships in the ISG, together with NYSE Rules 1301A and 1300A(b), will allow the NYSE to monitor for fraudulent and manipulative trading practices. 36 35 *See, e.g.* , Securities Exchange Act Release No. 50603 (October 28, 2004), 69 FR 64614 (November 5, 2004) (approving proposal by the NYSE to list and trade trust shares that correspond to a fixed amount of gold). 36 The Commission notes that it has previously approved the listing and trading of foreign currency options and warrants. *See, e.g.* , Securities Exchange Act Release Nos. 19133 (October 14, 1982), 47 FR 46946 (October 21, 1982) (order approving a Phlx proposal to accommodate the listing and trading of standardized option contracts on five foreign currencies, including the British Pound and Swiss Franc); 22471 (September 26, 1985), 50 FR 40636 (October 4, 1985) (order approving a proposed rule change by the Chicago Board Options Exchange, Inc. (“CBOE”) to trade standardized option contracts on six foreign currencies, including the British Pound, Canadian Dollar, and Swiss Franc); 23945 (December 30, 1986), 52 FR 633 (January 7, 1987) (order approving a proposal by the CBOE to trade standardized options on the Australian Dollar); and 35806 (June 5, 1995), 60 FR 30911 (June 12, 1995) (order approving a Phlx proposal to trade currency warrants based on the value of the U.S. dollar in relation to the Mexican Peso). NYSE Rule 1301A requires that the specialist handling the Shares provide the Exchange with information relating to its trading in options, futures or options on futures on the Japanese Yen, or any other derivatives based on the Japanese Yen. These reporting and recordkeeping requirements will assist the Exchange in identifying situations potentially susceptible to manipulation. NYSE Rule 1301A(c) also prohibits the specialist in the Shares from using any material, nonpublic information received from any person associated with a member or employee of such person regarding trading by such person or employee in the Japanese Yen, or options, futures or options on futures on the Japanese Yen, or any other derivatives based on the Japanese Yen (including the Shares). In addition, NYSE Rule 1300A(b) prohibits the specialist in the Shares from being affiliated with a market maker in the Japanese Yen, or options, futures or options on futures on the Japanese Yen, or any other derivative based on the Japanese Yen, unless information barriers are in place that satisfy the requirements in NYSE Rule 98. The Exchange also represents that it can obtain, through its ISG membership, information from CME regarding the trading of the Japanese Yen futures, and options on those futures, that trade on CME, and from Phlx regarding the trading of options on the Japanese Yen that trade on Phlx. In addition, the Exchange represents that it is able to obtain information regarding trading in the Shares, and options and futures on the Japanese Yen, through its members, in connection with such members' proprietary or customer trades that they effect on any relevant market. B. Dissemination of Information The Commission believes that sufficient venues for obtaining reliable information exist so that investors in the Shares can monitor the underlying Japanese Yen spot market relative to the NAV of their Shares. As discussed above, the Exchange represents that there is a considerable amount of foreign currency price and market information available 24 hours a day through public Web sites and through professional and subscription services, including Bloomberg and Reuters. 37 The Exchange further represents that major market data vendors regularly report current currency exchange pricing for a fee for the Japanese Yen underlying the Shares. In addition, the Exchange will provide a link to the Trust's Web site on the NYSE's public Web site. The Trust's Web site will provide, among other things, the Japanese Yen spot prices, 38 including the bids and offers and the midpoints between the bids and offers for the Japanese Yen, updated no less than every 5 to 10 seconds, and the daily Federal Reserve Bank of New York Noon Buying Rate. 37 The Exchange notes that, in most instances, real-time information is available for a fee, and information available free of charge is subject to delay (typically, 15 to 20 minutes). 38 As noted above, the spot price for the Japanese Yen published on the Trusts' Web site will be provided by FactSet Research Systems, which is not affiliated with the Trust, the Trustee, the Sponsor, the Depository, the Distributor or the Exchange. The Commission also notes that the Trust's Web site will contain:
(1)An IIV per Share for the Shares, updated at least every 15 seconds;
(2)a delayed indicative value (subject to a 20 minute delay), which is used for calculating premium/discount information;
(3)premium/ discount information, calculated on a 20 minute delayed basis;
(4)the NAV of the Trust, as calculated each business day by the Trustee; 39
(5)accrued interest per Share;
(6)the Basket Amount for the Japanese Yen; and
(7)the last sale price of the Shares as traded in the U.S. market, subject to a 20-minute delay, as it is provided free of charge. 40 Further, the Exchange represents that real-time information for prices for futures and options on the Japanese Yen traded on CME and Phlx are available from information service providers, and that CME and Phlx provide delayed futures and options information free of charge on their respective Web sites. The Commission believes that the wide availability of such information, as described above, will facilitate transparency with respect to the Shares and diminish the risk of manipulation or unfair informational advantage. 39 According to the Exchange, the Sponsor has represented to the Exchange that the NAV for the Trust will be available to all market participants at the same time. The Exchange further represents that therefore, no market participant will have a time advantage in using such data. 40 As noted above, the last sale price of the Shares in the secondary market will be disseminated over the Consolidated Tape. C. Listing and Trading The Commission finds that the Exchange's proposed rules and procedures for the listing and trading of the proposed Shares are consistent with the Act. Shares will trade as equity securities subject to NYSE rules including, among others, rules governing trading halts, responsibilities of the specialist, account opening, and customer suitability requirements. In addition, the Shares will be subject to NYSE listing and delisting rules and procedures governing the trading of ICUs on the NYSE. 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 their prospectus delivery obligations. D. Acceleration The Commission finds good cause for approving the proposed rule change, as amended, prior to the 30th day after the date of publication of the notice of filing thereof in the **Federal Register** . The Commission has previously granted approval to a NYSE proposal to adopt NYSE Rules 1300A and 1301A that govern the trading of Currency Trust Shares, and a proposal to list and trade Euro Shares pursuant to such rules. 41 The Shares proposed to be listed and traded in this proposed rule change, are substantially similar in structure and operation to the Euro Shares, will be listed and traded pursuant to the same rules, and do not raise any new issues. Therefore, the Commission finds good cause, consistent with Section 19(b)(2) of the Act, 42 to approve the proposal, as amended, on an accelerated basis. 41 *See* Securities Exchange Act Release No. 52843, (November 28, 2005), 70 FR 72486 (December 5, 2005), (SR-NYSE-2005-65) (order granting accelerated approval, after a 15-day comment period, to a NYSE proposal to list and trade Euro Shares, which represent units of fractional undivided beneficial interest in and ownership of the Euro Currency Trust). 42 15 U.S.C. 78s(b)(2). V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act 43 that the proposed rule change (SR-NYSE-2007-03), as amended, is approved on an accelerated basis. 43 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 44 44 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2844 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55281; File No. SR-NYSE-2007-07] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Extension of the Crossing Session III and IV Pilot February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 26, 2007, the New York Stock Exchange LLC (“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 substantially prepared by the Exchange. The Exchange filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, which renders it effective upon filing with the Commission. 4 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. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(6). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The NYSE proposes to extend until February 1, 2008 the following pilot programs (“Pilots”): Crossing Session III, for the execution of guaranteed price coupled orders by member organizations to fill the balance of customer orders at a price that was guaranteed to a customer prior to the close of the Exchange's 9:30 a.m. to 4:00 p.m. trading session; and Crossing Session IV, whereby an unfilled balance of an order may be filled at a price such that the entire order is filled at no worse price than the Volume Weighted Average Price (“VWAP”) for the subject security. The text of the proposed rule change is available at the NYSE, the Commission's Public Reference Room, and *http://www.nyse.com.* 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 NYSE 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 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 In SR-NYSE-2002-40, 5 the Commission approved an order establishing two new crossing sessions (Crossing Sessions III and IV) in the Exchange's Off-Hours Trading Facility (“OHTF”) as a pilot program (“Pilot”), expiring on December 1, 2004. Subsequently, the Commission published two notices of filing and immediate effectiveness of a proposed rule change extending the Pilot until February 1, 2006 6 and until February 1, 2007. 7 5 *See* Securities Exchange Act Release No. 48857 (December 1, 2003), 68 FR 68440 (December 8, 2003). 6 *See* Securities Exchange Act Release No. 51091 (January 28, 2005), 70 FR 6484 (February 7, 2005) (SR-NYSE-2005-01). 7 *See* Securities Exchange Act Release No. 53275 (February 13, 2006), 71 FR 8626 (February 17, 2006) (SR-NYSE-2006-02). This proposal extends the Pilot until February 1, 2008. 8 Crossing Sessions III and IV are described below. 8 The NYSE confirmed that the Pilots will continue to function in the same manner that they operated prior to the one-year extension. Telephone conversation between Jean Walsh, Principal Rule Counsel, Office of General Counsel, NYSE, and Tim Fox, Special Counsel, Division of Market Regulation, Commission and Johnna B. Dumler, Attorney, Division, Commission on February 8, 2007. Background The purpose of the original proposed rule change was to add two additional “Crossing Sessions” (Crossing Sessions III and IV) to the Exchange's OHTF. Before the proposed rule change, the OHTF consisted of Crossing Sessions I and II. Crossing Session I permits the execution, at the Exchange's closing price, of single-stock, single-sided closing price orders and crosses of single-stock, and closing price buy and sell orders. Crossing Session II permits the execution of crosses of multiple-stock (“basket”) aggregate priced buy and sell orders. For Crossing Session II, trade reporting is accomplished by reporting to the Consolidated Tape the total number of shares and the total market value of the aggregate-price trades. There is no indication of the individual component stocks involved in the aggregate-price transactions. Crossing Session III The Exchange is proposing to extend until February 1, 2008, the Pilot in Crossing Session III. Crossing Session III is described in Exchange Rule 907. This Pilot would continue to allow for the execution on the NYSE of “guaranteed price coupled orders” whereby member organizations could fill the unfilled balance of a customer order at a price which was guaranteed to the customer prior to the close of the Exchange's 9:30 a.m. to 4:00 p.m. trading session. The Granting of “Upstairs Stops” In serving their institutional customers, member firms may offer them a guarantee that a large size order will receive no worse than a particular price. Such a practice is usually referred to as an “upstairs stop” meaning that the firm guarantees that its customer's order will be executed at no worse price than the agreed-upon, guaranteed price, with the member firm trading for its own account, if necessary, to effectuate the guarantee. Typically, a member firm will seek to execute as much of the order as possible during the trading day at or below the “stop” price (in the case of a buy order) or at or above the “stop” price (in the case of a sell order). Any portion of the order not filled during the trading day will be completed after hours, with the firm either buying from, or selling to, its customer at a price which ensures that the entire order is executed at a price which is no worse than the “stop” price. Member firms typically execute the unfilled balance of the order, after the U.S. Consolidated Tape is closed, in the London over-the-counter market, where trades are not reported in real time. The purpose of this is simply to minimize the possibility that other market participants may ascertain the firm's, or the customer's inventory position, and possibly trade in the subject security to the detriment of the firm that granted the “upstairs stop.” It is more transparent to print the trade in the NYSE primary market during U.S. Consolidated Tape hours. Crossing Session IV The Exchange is also proposing to extend the Pilot in Crossing Session IV (which is also described in NYSE Rule 907), until February 1, 2008. Crossing Session IV is a facility whereby member organizations may fill the unfilled balance of a customer's order at a price such that the overall order is filled at a price that is no worse than the VWAP for the subject security on that trading day. The member organization would be required to document its VWAP agreement with the customer and the basis upon which the VWAP price would be determined. Operation of Crossing Sessions As described in NYSE Information-Memos 04-30 and 05-57 and NYSE Rule 907, Crossing Sessions III and IV would continue to operate as follows:
(i)The original order as to which an “upstairs stop” or “VWAP” has been granted may be of any size;
(ii)The customer must have received a “stop” (guaranteed price) or VWAP for the entire order;
(iii)The member firm must record all details of the order, including the price it has guaranteed its customer or that the entire order will be filled at no worse than the VWAP;
(iv)An order or the unfilled balance of an order that would be executed in Crossing Session III or Crossing Session IV may be of any size;
(v)The customer's order must be executed in Crossing Session III or Crossing Session IV at a price that ensures that the entire order is executed at a price that is no worse than the guaranteed price or the VWAP;
(vi)Orders may be entered in Crossing Session III or Crossing Session IV between 4 p.m. and 6:30 p.m., and must be identified as either a Crossing Session III or Crossing Session IV order;
(vii)Member firms will receive an immediate report of execution upon entering an order into Crossing Session III or Crossing Session IV;
(viii)Orders may be entered into Crossing Session III for execution at prices outside the trading range in the subject security during the 9:30 a.m. to 4 p.m. trading session;
(ix)Orders may not be entered into Crossing Session III or Crossing Session IV in a security that is subject to a trading halt at the close of the regular 9:30 a.m. to 4 p.m. trading session; and
(x)At 6:30 p.m., the Exchange will print trades reported through Crossing Session III as guaranteed price coupled orders or in Crossing Session IV as VWAP executions. 2. Statutory Basis The basis under the Act for this proposed rule change is the requirement under Section 6(b)(5) 9 that an Exchange have rules that are 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 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 The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not:
(i)Significantly affect the protection of investors or the public interest;
(ii)impose any significant burden on competition; and
(iii)become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) 10 and Rule 19b-4(f)(6) thereunder. 11 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). 11 17 CFR 240.19b-4(f)(6). NYSE has asked the Commission to waive the five-day pre-filing notice requirement and the 30-day operative delay. The Commission believes such waivers are consistent with the protection of investors and the public interest because they would allow the Pilots to operate without interruption. 12 For this reason, the Commission designates the proposal to be operative upon filing with the Commission. 12 For purposes only of waiving the 30-day pre-operative period, the Commission has considered the proposed rule's impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f). 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 e-mail to *rule-comments@sec.gov.* Please include File Number SR-NYSE-2007-07 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSE-2007-07. 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 will also 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-2007-07 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 13 13 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2848 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55282; File No. SR-Phlx-2007-03] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Eliminating the Telephone System Line Extension Charge February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on January 11, 2007, the Philadelphia Stock Exchange, Inc. (“Phlx” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III, below, which Items have been substantially prepared by the Phlx. The Phlx filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(2) thereunder, 4 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 17 CFR 240.19b-4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(2). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Phlx, pursuant to Section 19(b)(1) of the Act 5 and Rule 19b-4 thereunder, 6 proposes to eliminate from Appendix A of the Exchange's fee schedule the telephone system line extension charge of $22.50 per month per extension. Any member, participant, and member or participant organization may, however, keep their telephone system line extensions without being charged. The Exchange proposes to make effective beginning January 2007 the elimination of the telephone system line extension charge. 7 5 15 U.S.C. 78s(b)(1). 6 17 CFR 240.19b-4. 7 The monthly telephone system line extension charge for the month of January is not scheduled to be billed until the beginning of February 2007. The Exchange generally issues its invoices at the beginning of the subsequent month, with such invoices covering billing for the preceding month. Therefore, the monthly telephone system line extension charge for the month of January will be deleted from the January 2007 invoice, which is currently scheduled to be issued at the beginning of February 2007. Telephone conversation between Cynthia Hoekstra, Vice President, Phlx, and Molly M. Kim, Special Counsel, Division of Market Regulation, Commission, on February 7, 2007. The text of the proposed rule change is available at the Phlx, the Commission's Public Reference Room, and *http://www.Phlx.com.* 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 Phlx included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Phlx 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 Currently, the Exchange assesses a fee of $22.50 per month per extension for telephone system line extensions on the options and foreign currency trading floors. The Exchange recently eliminated this fee for members and member organizations on the equity trading floor in connection with the implementation of the Exchange's new equity system. 8 The Exchange proposes at this time to also eliminate this fee for members, participants, and member or participant organizations on the options and foreign currency trading floors. Any member, participant, and member or participant organization may, however, keep their telephone system line extensions without being charged. The purpose of this proposal is to simplify the Exchange's fee schedule and billing process. The Exchange proposes to eliminate the telephone system line extension charge for the billing period beginning January 2007. 9 8 *See* Securities Exchange Act Release No. 54941 (December 14, 2006), 71 FR 77079 (December 22, 2006) (SR-Phlx-2006-70). 9 *See* note 5 * supra.* 2. Statutory Basis The Exchange believes that its proposal to amend Appendix A of its fee schedule by deleting the telephone system line extension charge for its members, participants, and member or participant organizations is consistent with Section 6(b) of the Act 10 in general and furthers the objectives of Section 6(b)(4) of the Act 11 in particular in that it is an equitable allocation of reasonable fees and other charges among Exchange members. 10 15 U.S.C. 78f(b). 11 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 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 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 has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act 12 and paragraph (f)(2) of Rule 19b-4 thereunder, because it establishes or changes a due, fee, or other charge. 13 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. 12 15 U.S.C. 78s(b)(3)(A)(ii). 13 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-Phlx-2007-03 on the subject line. Paper Comments: • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-Phlx-2007-03. 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 the Phlx. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-Phlx-2007-03 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 14 14 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2838 Filed 2-16-07; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-55273; File No. SR-Phlx-2007-11] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Trading Phase Date of Regulation NMS February 12, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on February 6, 2007, the Philadelphia Stock Exchange, Inc. (“Phlx” 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 Phlx. The Exchange filed the proposal as a “non-controversial” rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 which rendered 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 17 CFR 240.19b-4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b-4(f)(6). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Phlx proposes to clarify the operation of XLE, the Exchange's new equity trading system, and various Phlx Rules in light of the Commission's extension of the Trading Phase Date of Regulation NMS from February 5, 2007 until March 5, 2007. 5 There is no change to Phlx Rule text. 5 *See* Securities Exchange Act Release No. 55160 (January 24, 2007), 72 FR 4202 (January 30, 2007). 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 Phlx included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Phlx 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 clarify the effect on XLE and various Phlx Rules of the Commission's extension of the Trading Phase Date of Regulation NMS from February 5, 2007 until March 5, 2007. 6 The Trading Phase Date is significant to the Exchange because that is the “[f]inal date for full operation of Regulation NMS-compliant trading systems [by exchanges] that intend to qualify their quotations for trade-through protection under Rule 611 [during the roll-out of Regulation NMS].” 7 The Phlx intends to qualify its quotations for trade-through protection under Rule 611 during the roll-out of Regulation NMS and therefore intends to operate a Regulation NMS-compliant trading system no later than the Trading Phase Date. 8 6 *Id.* 7 *Id.* at 4203. 8 *See* Phlx Rule 160. A number of Phlx Rules or portions of Rules adopted by Phlx in connection with XLE were approved with delayed effectiveness by the Commission until the Trading Phase Date that was in effect at that time, which was February 5, 2007. 9 With this proposed rule change, the Exchange clarifies that the effectiveness of these rules or portions of rules is tied to the Trading Phase Date, currently March 5, 2007, not to February 5, 2007. The Phlx Rules that are affected by this clarification include, but are not necessarily limited to the following: Phlx Rule 1(cc), Definition of Protected Bid, Offer or Quotation; Phlx Rule 185(b)(2)(C), regarding Intermarket Sweep Orders (“ISOs”); 10 Phlx Rule 185(c)(2)(D), regarding IOC Cross Orders marked by the XLE Participant entering the order as meeting the requirements of an intermarket sweep order in Regulation NMS Rule 600(b)(30); 11 Phlx Rule 185(c)(3), regarding IOC Cross Orders marked Benchmark or Qualified Contingent Trade; 12 Phlx Rule 185(h), regarding the “self-help” exemption to Rule 611; and Phlx Rule 186, Locking or Crossing Quotations in NMS Stocks. The Exchange also clarifies that the use of the term “Trading Phase Date” in Phlx Rule 185A means the Trading Phase Date, currently March 5, 2007, not February 5, 2007. 9 *See* Securities Exchange Act Release No. 54538 (September 28, 2006), 71 FR 59184 (October 6, 2006) (“XLE Approval Order”). 10 Phlx notes, however, ISOs and IOC Cross Orders marked by the XLE Participant entering the order as meeting the requirements of an intermarket sweep order in Regulation NMS Rule 600(b)(30) currently have a limited effectiveness pursuant to Phlx Rule 185A(b). *See* Securities Exchange Act Release Nos. 54788 (November 20, 2006), 71 FR 68877 (November 28, 2006) (SR-Phlx-2006-77) and 54760 (November 15, 2006), 71 FR 67687 (November 22, 2006) (SR-Phlx-2006-76). 11 *See supra* note 10. 12 Phlx notes, however, IOC Cross Orders marked Benchmark or Qualified Contingent Trade for Nasdaq securities currently are effective pursuant to Phlx Rule 185A(c) and (d). *See* Securities Exchange Act Release No. 55044 (January 5, 2007), 72 FR 1361 (January 11, 2007) (SR-Phlx-2006-92). In addition, Phlx may file additional proposed rule change(s) regarding IOC Cross Orders marked Benchmark or Qualified Contingent Trade for non-Nasdaq securities before March 5, 2007. Finally, the XLE Approval Order noted that the certain features of XLE would be rolled out in three phases. Phases 1 and 2, concerning two-sided orders and “Do Not Route” orders, are completed. Phase 3, routing functionally, is currently being rolled out and is scheduled to be completed before March 5, 2007. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act 13 in general, and furthers the objectives of Section 6(b)(5) of the Act 14 in particular, in that it is 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 by clarifying the effect on Phlx Rules of the recent extension of the Trading Phase Date of Regulation NMS from February 5, 2007 until March 5, 2007. 13 15 U.S.C. 78f(b). 14 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 No written comments were solicited or received by the Exchange. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing rule
(i)does not significantly affect the protection of investors or the public interest;
(ii)does not impose any significant burden on competition; and
(iii)by its terms, does not become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, provided that the Exchange has given the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change or such shorter time as designated by the Commission, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 15 and Rule 19b-4(f)(6) thereunder. 16 As required under Rule 19b-4(f)(6)(iii) under the Act, 17 Phlx provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, prior to the date of the filing of the proposed rule change. 15 15 U.S.C. 78s(b)(3)(A). 16 17 CFR 240.19b-4(f)(6). 17 17 CFR 240.19b-4(f)(6)(iii). A proposed rule change filed under Rule 19b-4(f)(6) under the Act 18 normally may not become operative prior to 30 days after the date of filing. However, Rule 19b-4(f)(6)(iii) under the Act 19 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has requested that the Commission waive the 30-day operative delay, which would make the rule change effective and operative upon filing. The Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest because the proposed rule change clarifies the effect on Phlx Rules of the recent extension of the Trading Phase Date of Regulation NMS from February 5, 2007 until March 5, 2007. 20 Accordingly, the Commission designates the proposal to be effective and operative upon filing with the Commission. 18 17 CFR 240.19b-4(f)(6). 19 17 CFR 240.19b-4(f)(6)(iii). 20 For the purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 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. 21 21 *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 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-Phlx-2007-11 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-Phlx-2007-11. 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 the Phlx. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-Phlx-2007-11 and should be submitted on or before March 13, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 22 22 17 CFR 200.30-3(a)(12). Florence E. Harmon, Deputy Secretary. [FR Doc. E7-2843 Filed 2-16-07; 8:45 am] BILLING CODE 8011-01-P SOCIAL SECURITY ADMINISTRATION Agency Information Collection Activities: Proposed Request and Comment Request The Social Security Administration
(SSA)publishes a list of information collection packages that will require clearance by the Office of Management and Budget
(OMB)in compliance with P.L. 104-13, the Paperwork Reduction Act of 1995, effective October 1, 1995. The information collection packages that may be included in this notice are for new information collections, approval of existing information collections, revisions to OMB-approved information collections, and extensions (no change) of OMB-approved information collections. SSA is soliciting comments on the accuracy of the agency's burden estimate; the need for the information; its practical utility; ways to enhance its quality, utility, and clarity; and on ways to minimize burden on respondents, including the use of automated collection techniques or other forms of information technology. Written comments and recommendations regarding the information collection(s) should be submitted to the OMB Desk Officer and the SSA Reports Clearance Officer. The information can be mailed, faxed or e-mailed to the individuals at the addresses and fax numbers listed below: *(OMB)* Office of Management and Budget, Attn: Desk Officer for SSA, Fax: 202-395-6974, E-mail address: *OIRA_Submission@omb.eop.gov* . *(SSA)* Social Security Administration, DCFAM, Attn: Reports Clearance Officer, 1333 Annex Building, 6401 Security Blvd., Baltimore, MD 21235, Fax: 410-965-6400, E-mail address: *OPLM.RCO@ssa.gov.* I. The information collections listed below are pending at SSA and will be submitted to OMB within 60 days from the date of this notice. Therefore, your comments should be submitted to SSA within 60 days from the date of this publication. You can obtain copies of the collection instruments by calling the SSA Reports Clearance Officer at 410-965-0454 or by writing to the address listed above. 1. *Application for Benefits under the Italy-U.S. International Social Security Agreement—0960-0445—20 CFR 404.1925.* The United States and Italy entered into an agreement on November 1, 1978. Article 19.2 of that agreement provides that an applicant for benefits can file his application with either country. Article 4.3 of the Protocol to the Agreement provides that the country that receives the application will forward agreed upon forms and applications to the other country. Form SSA-2528 is the form agreed upon that is completed by individuals who file an application for U.S. benefits directly with one of the Italian Social Security Agencies. The information collected on Form SSA-2528 is required by SSA in order to determine entitlement to benefits. The respondents are applicants for old-age, survivors or disability benefits, who reside in Italy. *Type of Request:* Extension of an OMB-approved information collection. *Number of Respondents:* 200. *Frequency of Response:* 1. *Average Burden Per Response:* 20 minutes. *Estimated Annual Burden:* 67 hours. 2. *Social Security Benefits Applications—20 CFR Subpart D, 404.310-404.311 and 20 CFR Subpart F, 404.601-401.603—0960-0618.* One of the requirements for obtaining Social Security benefits is the filing of an application so that a determination may be made on the applicant's eligibility for monthly benefits. In addition to the traditional paper application, SSA has developed various options for the public to add convenience and operational efficiency to the application process. The total estimated number of respondents to all application collections formats is 3,843,369 with a cumulative total of 995,457 burden hours. The respondents are applicants for retirement insurance benefits (RIB), disability insurance benefits (DIB), and/or spouses' benefits. *Type of Request:* Extension of an OMB-approved information collection. Internet Social Security Benefits Application
(ISBA)ISBA, which is available through SSA's Internet site, is one method that an individual can choose to file an application for benefits. Individuals can use ISBA to apply for retirement insurance benefits RIB, DIB and spouse's insurance benefits based on age. SSA gathers only information relevant to the individual applicant's circumstances and will use the information collected by ISBA to entitle individuals to RIB, DIB, and/or spouses' benefits. The respondents are applicants for RIB, DIB, and/or spouses benefits. *Number of Respondents:* 169,000. *Frequency of Response:* 1. *Average Burden Per Response:* 21.4 minutes. *Estimated Annual Burden:* 60,277 hours. Paper Application Forms Application for Retirement Insurance Benefits (SSA-1) The SSA-1 is used by SSA to determine an individual's entitlement to retirement insurance benefits. In order to receive Social Security retirement insurance benefits, an individual must file an application with the SSA. The SSA-1 is one application that the Commissioner of Social Security prescribes to meet this requirement. The information that SSA collects will be used to determine entitlement to retirement benefits. The respondents are individuals who choose to apply for Social Security retirement insurance. Approximately 1,460,692 respondents complete the SSA-1 annually. Of this total 97% (1,416,871) are completed through SSA's Modernized Claims System
(MCS)and 50% of the MCS respondents will use Signature Proxy (708,435.5). The breakdown is displayed on the following chart. Collection method Number of respondents Estimated completion time Burden hours MCS 708,436 10.5 minutes 123,976 MCS/Signature Proxy 708,435 9.5 minutes 112,169 Paper 43,821 10.5 minutes 7,669 Totals 1,460,692 243,814 Application for Wife's or Husband's Insurance Benefits (SSA-2) SSA uses the information collected on Form SSA-2 to determine if an applicant (including a divorced applicant) can be entitled to benefits as the spouse of the worker and the amount of the spouse's benefits. The respondents are applicants for wife's or husband's benefits, including those who are divorced. Approximately 700,000 respondents complete the SSA-2 annually. Of this total 95% (665,000) are completed through MCS and 50% of the MCS respondents will use Signature Proxy (332,500). The breakdown is displayed on the following chart: Collection method Number of respondents Estimated completion time Burden hours MCS 332,500 15 minutes 83,125 MCS/Signature Proxy 332,500 14 minutes 77,583 Paper 35,000 15 minutes 8,750 Totals 700,000 169,458 Application for Disability Insurance Benefits (SSA-16) Form SSA-16-F6 obtains the information necessary to determine whether the provisions of the Act have been satisfied with respect to an applicant for disability benefits, and detects whether the applicant has dependents who would qualify for benefits on his or her earnings record. The information collected on form SSA-16 helps to determine eligibility for Social Security disability benefits. The respondents are applicants for Social Security disability benefits. Approximately 1,513,677 respondents complete the SSA-16 annually. Of this total 97% (1,468,267) are completed through SSA's Modernized Claims System
(MCS)and 50% of the MCS respondents will use Signature Proxy (734,133.5). The breakdown is displayed on the following chart: Collection method Number of respondents Estimated completion time Burden hours MCS 734,134 20 minutes 244,711 MCS/Signature Proxy 734,133 19 minutes 232,476 Paper 45,410 20 minutes 15,137 Totals 1,513,677 492,324 II. The information collections listed below have been submitted to OMB for clearance. Your comments on the information collections would be most useful if received by OMB and SSA within 30 days from the date of this publication. You can obtain a copy of the OMB clearance packages by calling the SSA Reports Clearance Officer at 410-965-0454, or by writing to the address listed above. 1. *Pain Report Child—20 CFR 416.912 and 416.1512—0960-0540.* The information collected by form SSA-3371-BK will be used to obtain the types of information specified in SSA's regulations, and to provide disability interviewers (and applicants/claimants in self-help situations) with a convenient means of recording the information. This information is used by the State disability determination services
(DDS)adjudicators and administrative law judges to assess the effects of symptoms on functionality for determining disability under the Social Security Act. The respondents are applicants for Supplemental Security Income
(SSI)benefits. *Type of Request:* Extension of an OMB-approved information collection. *Number of Respondents:* 250,000. *Frequency of Response:* 1. *Average Burden Per Response:* 15 minutes. *Estimated Annual Burden:* 62,500 hours. 2. *Request for Hearing by Administrative Law Judge—20 CFR 404.929, 404.933, 416.1429, 404.1433, 405.722, 418.1350—0960-0269.* SSA uses form HA-501 to document when applicants for Social Security benefits have their claims denied and want to request an administrative hearing to appeal SSA's decision. The scope of this form is now being expanded to include people who wish to appeal the decision that has been made regarding their obligation to pay a new Income-Related Monthly Adjustment Amount (IRMAA) for Medicare Part B, as per the requirements of the Medicare Modernization Act of 2003. Although this information will be collected by SSA, the actual hearings will take place before administrative law judges
(ALJ)who are employed by the Department of Health and Human Services (HHS). The current respondents include applicants for various Social Security benefits programs who want to request a hearing where they can appeal their denial; the new additional respondents are Medicare Part B recipients whom SSA has determined will have to pay the new Medicare Part B IRMAA and who wish to appeal this decision at a hearing before an HHS ALJ. *Type of Request:* Revision of an OMB-approved information collection. *Number of Respondents:* 669,469. *Frequency of Response:* 1. *Average Burden Per Response:* 10 minutes. *Estimated Annual Burden:* 111,578 hours. 3. *Request to Resolve Questionable Quarters of Coverage (QC); Request for QC History Based on Relationship—0960-0575.* Form SSA-512 is used by states to request clarification from SSA on questionable QC information. The Personal Responsibility and Work Opportunity Reconciliation Act states that aliens admitted for lawful residence that have worked and earned 40 qualifying QCs for Social Security purposes can generally receive state benefits. Form SSA-513 is used by states to request QC information for an alien's spouse or child in cases where the alien does not sign a consent form giving permission to access his/her Social Security records. QCs can also be allocated to a spouse and/or to a child under age 18, if needed, to obtain 40 qualifying QCs for the alien. The respondents are state agencies that require QC information in order to determine eligibility for benefits. *Type of Request:* Extension of an OMB-approved information collection. Collections Number of respondents Frequency of response Average burden per response (minute) Estimated annual burden (hours) SSA-512 200,000 1 2 6,667 SSA-513 350,000 1 2 11,667 Totals 550,000 18,334 Dated: February 9, 2007. Elizabeth A. Davidson, Reports Clearance Officer, Social Security Administration. [FR Doc. E7-2662 Filed 2-16-07; 8:45 am] BILLING CODE 4191-02-P DEPARTMENT OF STATE [Public Notice 5698] Debarment Involving Henry L. Lavery III and Security Assistance International, Inc. ACTION: Notice. SUMMARY: Notice is hereby given that the Department of State has imposed an administrative debarment against Henry L. Lavery III and Security Assistance International, Inc. pursuant to a December 12, 2006 Consent Agreement and other authority based upon section 127.7(a) and (b)(2) of the International Traffic in Arms Regulations
(ITAR)(22 CFR sections 120 to 130). EFFECTIVE DATE: December 12, 2006. FOR FURTHER INFORMATION CONTACT: David Trimble, Director, Office of Defense Trade Controls Compliance, Bureau of Political-Military Affairs, Department of State
(202)663-2700. SUPPLEMENTARY INFORMATION: Section 127.7 of the ITAR authorizes the Assistant Secretary of State for Political-Military Affairs to debar any person who has been found pursuant to Section 128 of the ITAR to have committed a violation of the Arms Export Control Act
(AECA)or the ITAR of such character as to provide a reasonable basis for the Office of Defense Trade Controls Compliance to believe that the violator cannot be relied upon to comply with the AECA or ITAR in the future. Such debarment prohibits the subject from participating directly or indirectly in the export of defense articles or defense services for which a license or approval is required by the ITAR. Debarred persons are generally ineligible to participate in activity regulated under the ITAR (see e.g., sections 120.1(c) and (d), 126.7, 127.1(c), and 127.11(a)). The Department of State will not consider applications for licenses or requests for approvals that involve any debarred person. Henry L. Lavery III doing business as Security Assistance International, Inc.,
(SAI)was under a Consent Agreement dated June 3, 1999, as a result of a Proposed Charging Letter alleging numerous ITAR violations between April 1993 and April 1999. Mr. Lavery and his company, SAI, were cited for submitting export applications on behalf of clients containing falsified applicant signatures; failing to maintain records as required under the ITAR; obtaining export licenses for firms whose registrations expired or who were never registered; and brokering without being registered and without authorization. Under the June 3, 1999, Consent Agreement, Mr. Lavery was required to pay a $10,000 penalty, register as a broker, reconstruct export records, cease participating directly or indirectly in exports of defense articles and/or defense services and implement a compliance program outlining SAI's operating procedures and internal controls for adherence to the ITAR. On or about August 1, 2001, Mr. Lavery completed the requirements of the Consent Agreement and his export privileges were reinstated by the Department. On July 11, 2005, the Office of Defense Trade Controls Compliance conducted a review of SAI's ITAR compliance program. The review determined that many of the practices, which led to the June 3, 1999, Consent Agreement, had not been corrected. A July 14, 2003 license application for the temporary export of Night Vision equipment was submitted by Mr. Lavery on behalf of an unregistered company; Mr. Lavery was unable to provide complete records and/or was unable to produce records required to be maintained by the ITAR for his current authorized exports; and Mr. Lavery violated a license proviso requiring proof of export be provided to the Department. On December 12, 2006, as the result of these continuing violations, the Department and Mr. Lavery entered into a new Consent Agreement, which debarred Mr. Lavery and SAI until December 12, 2007. Reinstatement after December 12, 2007 is not automatic but contingent on full compliance with the terms of the December 12, 2006 Consent Agreement and evidence that the underlying problems that gave rise to the violations have been corrected. At the end of the debarment period, Mr. Lavery and SAI may apply for reinstatement. Until licensing privileges are reinstated, Mr. Lavery and SAI will remain debarred. This notice is provided to make the public aware that the persons listed above are prohibited from participating directly or indirectly in any brokering activities and in any export from or temporary import into the United States of defense articles, related technical data, or defense services in all situations covered by the ITAR. Exceptions may be made to this denial policy on a case-by-case basis at the discretion of the Directorate of Defense Trade Controls. However, such an exception would be granted only after a full review of all circumstances, paying particular attention to the following factors: Whether an exception is warranted by overriding U.S. foreign policy or national security interests; whether an exception would further law enforcement concerns that are consistent with foreign policy or national security interests of the United States; or whether other compelling circumstances exist that are consistent with the foreign policy or national security interests of the United States, and law enforcement concerns. This notice involves a foreign affairs function of the United States encompassed within the meaning of the military and foreign affairs exclusion of the Administrative Procedures Act. Because the exercise of this foreign affairs function is highly discretionary, it is excluded from review under the Administrative Procedures Act. Dated: January 29, 2007. Ambassador Stephen Mull, Acting Assistant Secretary for Political-Military Affairs. [FR Doc. E7-2831 Filed 2-16-07; 8:45 am] BILLING CODE 4710-25-P DEPARTMENT OF TRANSPORTATION Federal Motor Carrier Safety Administration [Docket No. FMCSA-98-4334, FMCSA-00-7363, FMCSA-02-13411] Qualification of Drivers; Exemption Applications; Vision AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT. ACTION: Notice of renewal of exemptions; request for comments. SUMMARY: FMCSA announces its decision to renew the exemptions from the vision requirement in the Federal Motor Carrier Safety Regulations for 15 individuals. FMCSA has statutory authority to exempt individuals from the vision requirement if the exemptions granted will not compromise safety. The Agency has concluded that granting these exemptions will provide a level of safety that will be equivalent to, or greater than, the level of safety maintained without the exemptions for these commercial motor vehicle
(CMV)drivers. DATES: This decision is effective March 4, 2007. Comments must be received on or before March 22, 2007. ADDRESSES: You may submit comments identified by DOT Docket Management System
(DMS)Docket Numbers FMCSA-98-4334, FMCSA-00-7363, FMCSA-02-13411, using any of the following methods. • *Web site: http://dmses.dot.gov.* Follow the instructions for submitting comments on the DOT electronic docket site. • *Fax:* 1-202-493-2251. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590-0001. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. • *Federal eRulemaking Portal:* Go to *http://www.regulations.gov.* Follow the online instructions for submitting comments. *Instructions:* All submissions must include the Agency name and docket numbers for this Notice. Note that all comments received will be posted without change to *http://dms.dot.gov,* including any personal information provided. Please see the Privacy Act heading for further information. *Docket:* For access to the docket to read background documents or comments received, go to *http://dms.dot.gov* at any time or Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The DMS is available 24 hours each day, 365 days each year. If you want us to notify you that we received your comments, please include a self-addressed, stamped envelope or postcard or print the acknowledgement page that appears after submitting comments on-line. *Privacy Act:* Anyone may search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or of the person signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the Department of Transportation's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477; Apr. 11, 2000). This information is also available at *http://dms.dot.gov.* FOR FURTHER INFORMATION CONTACT: Dr. Mary D. Gunnels, Chief, Physical Qualifications Division,
(202)366-4001, *maggi.gunnels@dot.gov,* FMCSA, Department of Transportation, 400 Seventh Street, SW., Room 8301, Washington, DC 20590-0001. Office hours are from 8:30 a.m. to 5 p.m., E.T., Monday through Friday, except Federal holidays. SUPPLEMENTARY INFORMATION: Exemption Decision Under 49 U.S.C. 31136(e) and 31315, FMCSA may renew an exemption from the vision requirements in 49 CFR 391.41(b)(10), which applies to drivers of CMVs in interstate commerce, for a two-year period if it finds “such exemption would likely achieve a level of safety that is equivalent to, or greater than, the level that would be achieved absent such exemption.” The procedures for requesting an exemption (including renewals) are set out in 49 CFR part 381. This notice addresses 15 individuals who have requested renewal of their exemptions in a timely manner. FMCSA has evaluated these 15 applications for renewal on their merits and decided to extend each exemption for a renewable two-year period. They are: Howard K. Bradley Kirk G. Braegger Ambrosio E. Calles Jose G. Cruz Everett A. Doty Donald J. Goretski Harry P. Henning Christopher L. Humphries Ralph J. Miles William R. New Thomas C. Rylee Stanley B. Salkowski, III Michael G. Thomas William H. Twardus Ronald Watt These exemptions are extended subject to the following conditions:
(1)That each individual have a physical examination every year
(a)by an ophthalmologist or optometrist who attests that the vision in the better eye continues to meet the standard in 49 CFR 391.41(b)(10), and
(b)by a medical examiner who attests that the individual is otherwise physically qualified under 49 CFR 391.41;
(2)that each individual provide a copy of the ophthalmologist's or optometrist's report to the medical examiner at the time of the annual medical examination; and
(3)that each individual provide a copy of the annual medical certification to the employer for retention in the driver's qualification file and retain a copy of the certification on his/her person while driving for presentation to a duly authorized Federal, State, or local enforcement official. Each exemption will be valid for two years unless rescinded earlier by FMCSA. The exemption will be rescinded if:
(1)The person fails to comply with the terms and conditions of the exemption;
(2)the exemption has resulted in a lower level of safety than was maintained before it was granted; or
(3)continuation of the exemption would not be consistent with the goals and objectives of 49 U.S.C. 31136(e) and 31315. Basis for Renewing Exemptions Under 49 U.S.C. 31315(b)(1), an exemption may be granted for no longer than two years from its approval date and may be renewed upon application for additional two year periods. In accordance with 49 U.S.C. 31136(e) and 31315, each of the 15 applicants has satisfied the entry conditions for obtaining an exemption from the vision requirements (63 FR 66226; 64 FR 16517; 67 FR 76439; 68 FR 10298; 70 FR 7545; 65 FR 45817; 65 FR 77066; 67 FR 71610). Each of these 15 applicants has requested timely renewal of the exemption and has submitted evidence showing that the vision in the better eye continues to meet the standard specified at 49 CFR 391.41(b)(10) and that the vision impairment is stable. In addition, a review of each record of safety while driving with the respective vision deficiencies over the past two years indicates each applicant continues to meet the vision exemption standards. These factors provide an adequate basis for predicting each driver's ability to continue to drive safely in interstate commerce. Therefore, FMCSA concludes that extending the exemption for each renewal applicant for a period of two years is likely to achieve a level of safety equal to that existing without the exemption. Request for Comments FMCSA will review comments received at any time concerning a particular driver's safety record and determine if the continuation of the exemption is consistent with the requirements at 49 U.S.C. 31136(e) and 31315. However, FMCSA requests that interested parties with specific data concerning the safety records of these drivers submit comments by March 22, 2007. FMCSA believes that the requirements for a renewal of an exemption under 49 U.S.C. 31136(e) and 31315 can be satisfied by initially granting the renewal and then requesting and evaluating, if needed, subsequent comments submitted by interested parties. As indicated above, the Agency previously published notices of final disposition announcing its decision to exempt these 15 individuals from the vision requirement in 49 CFR 391.41(b)(10). The final decision to grant an exemption to each of these individuals was based on the merits of each case and only after careful consideration of the comments received to its notices of applications. The notices of applications stated in detail the qualifications, experience, and medical condition of each applicant for an exemption from the vision requirements. That information is available by consulting the above cited **Federal Register** publications. Interested parties or organizations possessing information that would otherwise show that any, or all of these drivers, are not currently achieving the statutory level of safety should immediately notify FMCSA. The Agency will evaluate any adverse evidence submitted and, if safety is being compromised or if continuation of the exemption would not be consistent with the goals and objectives of 49 U.S.C. 31136(e) and 31315, FMCSA will take immediate steps to revoke the exemption of a driver. Issued on: February 9, 2007. Pamela M. Pelcovits, Office Director, Policy, Plans and Regulations. [FR Doc. E7-2846 Filed 2-16-07; 8:45 am] BILLING CODE 4910-EX-P DEPARTMENT OF TRANSPORTATION Pipeline and Hazardous Materials Safety Administration Office of Hazardous Materials Safety; Notice of Applications for Modification of Special Permit AGENCY: Pipeline and Hazardous Materials Safety Administration, DOT. ACTION: List of Applications for Modification of Special Permit. SUMMARY: In accordance with the procedures governing the application for, and the processing of, special permits from the Department of Transportation's Hazardous Material Regulations (49 CFR Part 107, Subpart B), notice is hereby given that the Office of Hazardous Materials Safety has received the application described herein. This notice is abbreviated to expedite docketing and public notice. Because the sections affected, modes of transportation, and the nature of application have been shown in earlier **Federal Register** publications, they are not repeated here. Request of modifications of special permits (e.g. to provide for additional hazardous materials, packaging design changes, additional mode of transportation, etc.) are described in footnotes to the application number. Application numbers with the suffix “M” denote a modification request. These applications have been separated from the new applications for special permits to facilitate processing. DATES: Comments must be received on or before March 7, 2007. *Address Comments to:* Record Center, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, Washington, DC 20590. Comments should refer to the application number and be submitted in triplicate. If confirmation of receipt of comments is desired, include a self-addressed stamped postcard showing the special permit number. FOR FURTHER INFORMATION CONTACT: Copies of the applications are available for inspection in the Records Center, Nassif Building, 400 7th Street, SW., Washington, DC or at *http://dms.dot.gov.* This notice of receipt of applications for modification of special permits is published in accordance with Part 107 of the Federal hazardous materials transportation law (49 U.S.C. 5117(b); 49 CFR 1.53(b)). Issued in Washington, DC, on February 7, 2007. Delmer F. Billings, Director, Office of Hazardous Materials, Special Permits & Approvals. Application No. Docket No. Applicant Regulation(s) affected Nature of special permit thereof MODIFICATION SPECIAL PERMITS 8915-M Matheson Tri Gas 49 CFR 173.302a(a)(3); 173.301(d); 173.302a(a)(5) To modify the special permit to authorize the transportation in commerce of additional Division 2.1 materials in DOT Specification 3A, 3AA, 3AX, 3AAX and 3T cylinders. 10885-M U.S. Department of Energy, Washington, DC 49 CFR 172.101 Col. 9(b), 172.204(c)(3); 173.27(b)(2); 173.27(f) Table 2; 175.30(a)(1); 173.27(b)(3) To modify the special permit to authorize the transportation in commerce of additional hazardous materials and to provide relief from segregation by highway. 12274-M 1999-5707 Snow Peak, Inc., Clackamas, OR 49 CFR 172.301, 173.302a(b)(2), (b)(3) and (b)(4); 180.205(c) and
(g)and 180.209(a) To modify the special permit to authorize larger non-DOT specification nonrefillable inside containers. 12283-M 1999-5767 Interstate Battery of Alaska, Anchorage, AK 49 CFR 173.159(c)(1); 173.159(c) To modify the special permit to authorize the round trip transportation in commerce of batteries within the State of Alaska. 12571-M 2000-8315 Air Products & Chemicals, Inc., Allentown, PA 49 CFR 173.304(a)(2); 180.209 To modify the special permit to authorize markings on the sides of the trailers rather than on each individual tube. 13167-M ITT Industries Space, Systems, LLC, Rochester, NY 49 CFR 173.301(f); 173.304 To modify the special permit to authorize an additonal non-DOT specification packaging. 14392-M Department of Defense, Ft. Eustis, VA 49 CFR 172.101 Column (10B); 176.65, 176.83(a)(b)(g), 176.84(c)(2); 176.136; and 176.144(a) To reissue the special permit of originally issued on an emergency basis for the transportation in commerce of explosives by vessel in an alternative stowage configuration. 14466-M 2007-27095 Northern Air Cargo, Anchorage, AK 49 CFR 172.101 Column
(9B)To reissue the special permit originally issued on an emergency basis for the transportation in commerce of certain Class I explosive materials which are forbidden for transportation by air, to be transported by cargo aircraft within the State of Alaska when other means of transportation are impracticable or not available. [FR Doc. 07-733 Filed 2-16-07; 8:45 am]
Connectionstraces to 20
Traces to 20 documents
20 references not yet in our index
  • Pub. L. 106-567
  • 114 Stat. 2856
  • 10 CFR 2
  • 10 CFR 63
  • 10 CFR 20
  • 17 CFR 240.19
  • 15 USC 78(f)(b)
  • 15 USC 78(f)(b)(5)
  • 22 CFR 120
  • 49 CFR 391.41(b)(10)
  • 49 CFR 381
  • 49 CFR 391.41
  • 49 CFR 107
  • 49 CFR 1.53(b)
  • 49 CFR 173.302
  • 49 CFR 172.101
  • 49 CFR 172.301
  • 49 CFR 173.159(c)(1)
  • 49 CFR 173.304(a)(2)
  • 49 CFR 173.301(f)
Citation graph
cites case law
Notices
Notice of reopening of public comment period
U.S.C.§ 552a
U.S.C.§ 3535
C.F.R.§ 50.91
C.F.R.§ 50.92
C.F.R.§ 2.309
U.S.C.§ 78f
U.S.C.§ 78c
U.S.C.§ 78s
C.F.R.§ 200.30-3
Pub. L.Pub. L. 106-567
Stat.114 Stat. 2856
Cite10 CFR 2
Cites 40 · showing 12Cited by 0 across 0 sources
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