Daily Rules, Proposed Rules, and Notices of the Federal Government
The Phlx proposes to amend Phlx Rule 229, Philadelphia Stock Exchange Automated Communication and Execution System (PACE),
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.
The purpose of the proposed rule change is to provide specialists on the Exchange's Equity Floor with the ability to interface with PACE via a proprietary connection (an SQF) that would enable Exchange equity specialists to price equity securities with their own pricing models, subject to the Exchange's prior approval. Such approval would be required by the Exchange's Floor Procedure Committee, which has supervision over all connections or means of communication with the equity trading floor.
The Exchange believes that the proposed rule change should enable Exchange specialists to provide their own stock quotations using their own proprietary systems. The Phlx believes that such proprietary systems should permit equity specialist units to price securities more precisely, and pursuant to their own business models. For instance, some specialist units may consider prices of related futures products when calculating a bid or offer for a security such as an Exchange Traded Fund ("ETF") product.
The Phlx believes the proposed rule change is consistent with Section 6 of the Act
The Phlx does not believe that the proposed rule change would impose any inappropriate burden on competition.
No written comments were either solicited or received.
The proposed rule change is effective upon filing pursuant to Section 19(b)(3)(A) of the Act,
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.
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. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exhange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 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 filings will also be available for inspection and copying at the principal office of the Phlx. All submissions should refer to File No. SR-Phlx-2001-103 and should be submitted by March 14, 2002.