[Federal Register Volume 87, Number 61 (Wednesday, March 30, 2022)]
[Notices]
[Pages 18416-18419]
[FR Doc No: 2022-06628]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94505; File No. SR-LCH SA-2022-003]

Self-Regulatory Organizations; LCH SA; Notice of Filing of
Proposed Rule Change Relating to the Restructuring Notification Process
for Swaptions

March 24, 2022.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'' or ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on March 18, 2022, Banque Centrale de
Compensation, which conducts business under the name LCH SA (``LCH
SA''), 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 LCH SA. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

    (a) Banque Centrale de Compensation, which conducts business under
the name LCH SA (``LCH SA''), is proposing to amend its (i) CDS
Clearing Supplement (``Supplement'') and (ii) CDS Clearing Procedures
(``Procedures'') to incorporate new terms and to make conforming,
clarifying and clean-up changes to implement a delegation mechanism for
clients of CDSClear clearing members which applies in the context of
the restructuring process for swaptions (the ``Proposed Rule Change'').
    The text of the Proposed Rule Change has been annexed [sic] as
Exhibit 5.\3\
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    \3\ All capitalized terms not defined herein have the same
definition as in the CDS Clearing Rule Book, Supplement or
Procedures, as applicable.
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    The implementation of the Proposed Rule Change will be contingent
on LCH SA's receipt of all necessary regulatory approvals.
    (b) Not applicable.
    (c) Not applicable.

II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

    In its filing with the Commission, LCH SA 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. LCH SA has prepared summaries, set forth in sections A,
B, and C below, of the most significant aspects of these statements.

A. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

(a) Purpose
    The purpose of the Proposed Rule Change is to to [sic] amend the
restructuring notification process applicable in respect of swaptions
registered in a Client Account Structure. Currently, in the event of a
restructuring which would be applicable to a component transaction of
the underlying index transaction to which a set of swaptions relate,
Clearing Members would be in charge of sending and receiving the
relevant notices in respect of this restructuring and notifying LCH SA
of any such notice delivered or received by no later than 5:00 p.m. on
the cut-off date. Where such restructuring also relate to swaptions
registered in a Client Account Structure, this also implies from the
Client that it shall first deliver the restructuring notice to its
Clearing Member and its Clearing Member delivers the equivalent notice
to the other Clearing Member to allow for this notification requirement
by the relevant Clearing Member to LCH SA by no later than 5:00 p.m. on
the cut-off date.
    The proposed amendments to the restructuring process for swaptions
registered in a Client Account Structure will remove any dependency
between the notification duties in the context of a restructuring. The
proposed rule change will provide for a delegation mechanism whereby
Clearing Members shall appoint their Clients as their Restructuring
Delegation Beneficiaries for the purposes of sending and receiving the
relevant notices to the other Clearing Member(s) or Client(s) in the
event of a restructuring affecting the swaptions registered in their
relevant Client Account Structure. The notification duty vis-[agrave]-
vis LCH SA following the sending or receiving of the notices will also
rely on such Restructuring Delegation Beneficiary. These amendments
replicate the current delegation legal mechanism which is used in the
context of the exercise process in respect of swaptions registered in a
Client Account Structure.
1. Supplement
    LCH SA is proposing to modify Part C of the Supplement (``Part C'')
to incorporate terms for implementing the delegation mechanism for the
restructuring process and to make certain conforming and clean-up
changes to improve clarity of Part C.
    Section 1.2 (Terms defined in the CDS Clearing Supplement) of Part
C would be amended by adding the following new defined terms.
    The term ``Restructuring Delegation Beneficiary'' would be added to
refer to a Client of a Clearing Member designated by such Clearing
Member pursuant to new Section 5.7 (Delegation by Clearing Members to
Clients) as being entitled to send and receive Credit Event Notices and
Notices to Exercise Movement Option in respect of the relevant Swaption
Restructuring Cleared Transactions on such Clearing Member's behalf.
    The term ``Swaption Restructuring CCM Client Notice would be added
to make a cross reference to its definition as set out in Mandatory
Provision 7.3 (Duty to Deliver Swaption Restructuring CCM Client
Notice) in Appendix VIII to Part C.

    The existing term ``Exercise Delegation Beneficiary'' would be
amended for clarification purpose as the current reference to ``The''
Client seems to imply that only a single Client of a Clearing Member
could be appointed as an Exercise Delegation Beneficiary irrespective
of whether the Clearing Member is acting on behalf of other Clients and
therefore this reference will be replaced by ``A'' Client for the sake
of clarity.
    Because of the new Section 5.7 (Delegation by Clearing Members to
Clients) added to Part C, any cross-references to Sections 5 following
this new Section 5.7 should be renumbered. Therefore the cross-
references in the definitions of ``Swaption Restructuring Clearing
Member Notice'' and ``Swaption Restructuring Clearing Member Notice
Deadline'' would be updated accordingly.
    A new sub-paragraph (ii) would be added to Section 1.7 (c)
(Application to FCM/BD Clearing Members) to provide that,
notwithstanding an FCM/BD Clearing Member acting as agent for the
account of an FCM/BD Client with respect to Index Swaption Cleared
Transactions, an FCM/BD Clearing Member shall designate its FCM/BD
Client to send and receive the relevant restructuring notices on its
behalf as its Restructuring Delegation Beneficiary in accordance with
the relevant provisions of Part C. As a result, the current equivalent
paragraph (c) in respect of the exercise process has been renumbered as
a sub-paragraph (i).
    Section 5 (Restructuring) of Part C would be amended to add new
provisions to implement this delegation mechanism for the restructuring
process involving swaptions registered in a Client Account Structure.
    Sections 5.1, 5.3, 5.5 and 5.6 of Part C would be amended by adding
references to the new defined term of Restructuring Delegation
Beneficiary where needed.
    An additional paragraph would be added at the end of Section 5.1 to
provide for the express consent from the Clearing Member on the
disclosure of its information needed for the purpose of the
restructuring process.
    A new Section 5.7 (Delegation by Clearing Members to Clients) is
proposed to be added in order to provide for the legal mechanism of
delegation which will apply for Clients and will replicate the
equivalent provisions of Section 6.4 (Delegation by Clearing Members to
Clients) applicable in respect of the exercise process. Specifically,
Section 5.7 would provide that, with respect to the sending of the
relevant notices for Swaption Restructuring Cleared Transactions of a
Swaption Restructuring Matched Pair which are Client Cleared
Transactions, Clearing Members shall designate their relevant Clients
to act on their behalf and such designation will take effect as soon as
reasonably practicable following receipt by LCH SA of duly completed
and signed Delegation Forms. The Client so designated will be the
Restructuring Delegation Beneficiary. Such designation may be withdrawn
provided that there is no Swaption Restructuring Cleared Transaction
registered in the relevant Client Account Structure. Where a Clearing
Member designates its Client in accordance with new Section 5.7, any
delivery or receipt of a restructuring notice by the designated Client
will be deemed to constitute the delivery or receipt of a valid
restructuring notice by its Clearing Member. Similarly, any reference
in Part C to a restructuring notice delivered or received by a
designated Client will be interpreted as delivery or receipt by a
Clearing Member.
    Because of the insertion of this new Section 5.7 (Delegation by
Clearing Members to Clients) in Part C, the following Sections 5 would
be renumbered and any cross-reference in Part C to the renumbered
Sections would be amended accordingly.
    Section 5.8 (Swaption Restructuring Clearing Member Notices) of
Part C would be amended to include the appropriate references to the
Client designated as a Restructuring Delegation Beneficiary which will
notify LCH SA of the delivery or receipt of the relevant restructuring
notices on behalf of its Clearing Member in order that LCH SA may give
effect to the relevant restructuring notices exchanged between the
parties to a Swaption Restructuring Cleared Transaction. There will be
also references to the new defined term of Swaption Restructuring CCM
Client Notice to be added and which, pursuant to Mandatory Provision
7.3 of Appendix VIII to Part C, will refer to the notice sent to LCH SA
or the relevant Clearing Member by a Restructuring Delegation
Beneficiary following receipt or delivery of a restructuring notice.
    Paragraph (b) of Section 8.1 (General Rules relating to Notices) to
[sic] remove the reference to the occurrence of an Electronic Exercise
Platform (``EEP'') Failure Event since the scope of this paragraph will
be broader than the exercise process as it will include a new reference
to a Restructuring Delegation Beneficiary.
    Finally, Section 13 (Exclusion of Liability) of Part C would be
amended to add a new Section 13(c) replicating the provisions of
Section 13(b) and specifying that LCH SA would have no liability to a
Clearing Member which has delegated to a Restructuring Delegation
Beneficiary its power to send or receive the relevant restructuring
notices on its behalf for any loss, cost or expense arising out of any
failure of such Restructuring Delegation beneficiary to perform its
obligations in relation with such delegation or in connection with or
arising from the delivery of such notices.
    Part C would be also amended to make the following conforming
changes that are not related to the restructuring delegation.
    In Section 6.1 (Creation and Notification of Exercise Matched
Pairs) of Part C, the provisions on the content of the Protected
Exercise Matched Pair Report would be amended to remove any reference
to contact details of the relevant parties. Indeed, since such contract
details will be the subject of a separate notification by LCH SA, a new
paragraph would be added at the end of sub-paragraph (ii) of Section
6.5(a) which would be entitled as ``Access to the Protected Exercise
Matched Pair Report and other information''. As a result of this
change, any reference to the Protected Exercise Matched Pair Report in
Part C, including but not limited to Section 8, would be amended by
either removing the reference to this report to keep general
notification's references or adding a reference to any other
information which is notified by LCH SA for the purpose of the exercise
process for consistency purposes. Similarly to the amendment made under
Section 5.1, an additional paragraph will be added at the end of
Section 6.1 to require for the express consent from the Clearing Member
on the disclosure of its information needed for the purpose of the
exercise process.
    In addition, and on the basis of new Section 5.7, Section 6.4 would
specify that the designation of a Client as an Exercise Delegation
Beneficiary may be withdrawn provided that there is no Exercise Cleared
Transaction registered in the relevant Client Account Structure.
    Appendix VIII (CCM Client Transaction Requirements) to Part C would
be amended for the purposes of including references to the new
delegation mechanism for the restructuring process. Any Client
designated as a Restructuring Delegation Beneficiary will be in charge
of sending and receiving the relevant restructuring notice for the
relevant Swaption Index Cleared Transaction directly to the relevant
Clearing Member or Client on behalf of its Clearing Member. As a

result, there will be no longer the need for them to send restructuring
notices to their Clearing Members to allow them to send equivalent
notice to the other Clearing Member comprised in the relevant Matched
Pair. Mandatory Provision 4 will be therefore amended to remove the
reference to the restructuring notices that could be sent by a CCM
Client to its CCM in respect of the mirroring transaction between such
CCM Client and CCM.
    The changes made to Section 6.1 (Creation and Notification of
Exercise Matched Pairs) of Part C would be replicated in Mandatory
Provisions 5.4 and 5.8 to remove the reference to the Protected
Exercise Matched Pair Report which is too restrictive or refer to other
notice details provided by LCH SA for the purposes of the exercise
process.
    Mandatory Provision 5.6 would be amended to add a reference to the
CCM since contact details of a CCM Client could be also provided by a
CCM to LCH SA.
    The current Mandatory Provision 7 is entirely removed from Appendix
VIII as it applies to the delivery of notices in respect of the
mirroring transaction between a CCM Client and its CCM in the event of
restructuring, which will be no longer needed following the
implementation of the proposed rule change. New Mandatory Provision 7
will be entitled ``Designation of CCM Client as a Restructuring
Delegation Beneficiary by CCM'' and replicates the equivalent
provisions of Mandatory Provision 5 (Designation of CCM Client as an
Exercise Delegation Beneficiary) subject to the necessary amendments
linked to the restructuring process. New paragraph 7.1 will provide for
the mandatory designation of a CCM Client as a Restructuring Delegation
Beneficiary by its CCM in accordance with new Section 5.7 of Part C.
New paragraph 7.2 will provide that neither the CCM nor the CCM Client
shall send the relevant restructuring notices for the mirroring
transaction between the CCM and its CCM Client but instead the CCM
Client as the Restructuring Delegation Beneficiary shall send or
receive the relevant restructuring notices for the corresponding CCM
Client Cleared Transaction pursuant to Part C, such restructuring
notices being deemed sent or received in respect of the relevant
mirroring transaction. The following new paragraph 7.3 provides for the
duty to deliver a Swaption Restructuring CCM Client Notice to LCH SA by
the Restructuring Delegation Beneficiary. If such notification is not
made within the required timeframe, LCH SA will decide either to give
effect to the restructuring notices pursuant to Section 5.8(c) of Part
C or not to give effect to the restructuring notices then, following
Exercise, an amount shall be payable between the Clearing Members equal
to the difference between the value of the Matched Buyer Contract had
the Swaption Restructuring CCM Client Notice been given to LCH SA
within the required timeframe and the value of such contract in the
absence of such Swaption Restructuring CCM Client Notice having been
given. This amount shall be determined and paid in accordance with the
provisions of this new paragraph. New paragraph 7.4 relates to the
contact details of LCH SA and the CCM Client to be used for the
purposes of delivering the relevant notices. Last paragraph 7.5
provides for a confidentiality waiver regarding the notice details
provided by the CCM Client.
    Finally, the proposed amendments to the Supplement also contain
typographical corrections in Sections 3.1 and 8.1(c) of Part C and
Mandatory Provisions 5.1 and 5.4 of Appendix VIII to Part C without
affecting the meanings of such Sections or Mandatory Provisions.
2. Procedures
    LCH SA also proposes to modify Section 5 of the Procedures to
incorporate terms for implementing the new delegation mechanism for the
purposes of the restructuring process applicable in respect of
swaptions.
    Section 5.19.1 which currently deals with the delegation applicable
to the exercise process will be amended for taking into account the
delegation for the restructuring process. Consequently, Section 5.19.1
will be entitled ``Delegation by Clearing Members to Clients'' and
Section 5.19 ``Delegation by Clearing Members to Clients and Electronic
Exercise Platform''.
    Pursuant to amended Section 5.19.1, a Clearing Member which has
delegated to a Client the power to send and receive the relevant
notices in the context of a restructuring for swaptions in accordance
with Section 5 of Part C shall notify such Restructuring Delegation by
sending the relevant form to LCH SA which will be defined as the
Delegation Form as it will contain both Exercise Delegation and
Restructuring Delegation. The defined term of ``Exercise Delegation
Withdrawal'' will be also replaced by ``Delegation Withdrawal'' to
cover the possibility for withdrawing the delegation applicable in
respect of the restructuring process and references to provisions of
Part C that are equivalent to the withdrawal for the exercise process
will be added for the restructuring process.
    Other amendments will be made to Section 5.19.1 in order to include
the references to either the Restructuring Delegation Beneficiary or
the Restructuring Delegation where relevant.
(b) Statutory Basis
    LCH SA believes that the Proposed Rule Change is consistent with
the requirements of Section 17A of the Securities Exchange Act of 1934
\4\ (the ``Act'') and the regulations thereunder, including the
standards under Rule 17Ad-22.\5\ Section 17(A)(b)(3)(F) \6\ of the Act
requires, among other things, that the rules of a clearing agency be
designed to promote the prompt and accurate clearance and settlement of
securities transactions and derivative agreements, contracts, and
transactions and to assure the safeguarding of securities and funds
which are in the custody or control of the clearing agency or for which
it is responsible. As noted above, the Proposed Rule Change is designed
to implement the delegation legal mechanism to operationally facilitate
any required restructuring notification process for swaptions which
will improve the process for sending and receiving of restructuring
notices to more promptly and accurately reflect the restructuring
status of the cleared option transaction in LCH systems.
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    \4\ 15 U.S.C. 78q-1.
    \5\ 17 CFR 240.17Ad-22.
    \6\ 15 U.S.C. 78q-1(b)(3)(F).
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    Further, LCH SA believes that the proposed changes to the Rule
Book, Supplement and Procedures are consistent with requirements of
Rule 17Ad-22(e)(17).\7\ Rule 17Ad-22(e)(17) requires a covered clearing
agency to manage operational risks by (i) identifying the plausible
sources of operational risk, both internal and external, and mitigating
their impact through the use of appropriate systems, policies,
procedures, and controls; (ii) ensuring that systems have a high degree
of security, resiliency, operational reliability, and adequate,
scalable capacity; and (iii) establishing and maintaining a business
continuity plan that addresses events posing a significant risk of
disrupting operations.\8\
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    \7\ 17 CFR 240.17Ad-22(e)(17).
    \8\ 17 CFR 240.17Ad-22(e)(17).
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    As described above, the Proposed Rule Change will enable LCH SA to
more effectively manage the operational notification risks associated
with the restructuring event process by providing an alternative
solution with an operational delegation mechanism for

the restructuring notification process. Specifically, the current
bilateral notification process creates plausible operational and legal
risks if LCH SA is not provided in due time by its Clearing Member with
the relevant restructuring notice sent by the client. To remove any
unnecessary dependency on the bilateral notification process and duties
between the Clearing Members(s) and client(s) in the context of a
restructuring event for swaptions, the Proposed Rule Change is designed
to implement a delegation mechanism whereby clients of Clearing Members
shall be appointed as their Restructuring Delegation Beneficiaries for
the purposes of sending and receiving the relevant notices to the other
Clearing Member(s) or Client(s) in the event of a restructuring
affecting the swaptions registered in their relevant Client Account
Structure.
    By implementing a relevant and consistent delegation legal
mechanism, the Proposed Rule Change is reducing potential legal risk at
LCH SA and is therefore consistent with the requirements of a well-
founded, clear, transparent, and enforceable legal framework of
Exchange Act Rule 17Ad-22(e)(1).\9\
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    \9\ 17 CFR 240.17Ad-22(e)(1).
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    For the reasons stated above, LCH SA believes that the Proposed
Rule Change with respect to the Supplement and Procedures in connection
with the implementation of the delegation mechanism for the
restructuring notification process for swaptions are consistent with
the requirements of prompt and accurate clearance and settlement of
securities transactions in Section 17(A)(b)(3)(F) \10\ of the Act and
the requirements of operational risk management in Rule 17Ad-22(e)(17)
\11\ and of a well-founded legal framework in Rule 17Ad-22(e)(1).\12\
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    \10\ 15 U.S.C. 78q-1(b)(3)(F).
    \11\ 17 CFR 240.17Ad-22(e)(17).
    \12\ 17 CFR 240.17Ad-22(e)(1).
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B. Clearing Agency's Statement on Burden on Competition

    Section 17A(b)(3)(I) of the Act requires that the rules of a
clearing agency not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.\13\ LCH SA does
not believe that the proposed rule change would impose burdens on
competition that are not necessary or appropriate in furtherance of the
purposes of the Act. Specifically, the proposed changes to the
Supplement and Procedures would apply equally to all Clearing Members
and their Clients. This would remove the burden on clearing brokers
from needing the operational capacity to intermediate the sending and
receiving of notices from clients, thereby improving the competitive
landscape for clearing brokers wishing to support the clearing of
options. Therefore, LCH SA does not believe that the proposed rule
change would impose a burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.
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    \13\ 15 U.S.C. 78q-1(b)(3)(I).
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C. Clearing Agency'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 been
solicited or received. LCH SA will notify the Commission of any written
comments received by LCH SA.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-LCH SA-2022-003 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-LCH SA-2022-003. This
file number should be included on the subject line if email 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 website (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 website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of LCH SA and on LCH SA's website
at: https://www.lch.com/resources/rulebooks/proposed-rule-changes.
    All comments received will be posted without change. Persons
submitting comments are cautioned that we do not redact or edit
personal identifying information from comment submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-LCH SA-2022-003 and should
be submitted on or before April 20, 2022.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-06628 Filed 3-29-22; 8:45 am]
BILLING CODE 8011-01-P


Comment Info: =================

General Comment:Dear Mr. Zeller:

I was a more than 45 years smoker of 1 1/2 packs of cigarettes a day. Two years ago I started using electronic cigarettes and stopped smoking. Please hear my voice and that of countless others who have had the same experience.

I am writing as an individual consumer to request an extension of the comment period for the Food and Drug Administration's ("FDA") Proposed Rule Deeming Tobacco Products to be Subject to the Federal Food, Drug, and Cosmetic Act, as amended by the Family Smoking and Prevention and Tobacco Control Act (the "Proposed Rule") published at 79 Fed. Reg. 23,142 and Federal Register No. 2014-09491. On behalf of myself, I am requesting that the comment period for the Proposed Rule be extended by the FDA for an additional 105 days, from its current 75-day period, to 180 days.

The Proposed Rule raises a number of significant issues and questions that are important and relevant to me, as a consumer of products that are proposed for regulation under the Proposed Rule. The Proposed Rule asks about a hundred different questions I might want to respond to. I want to provide my thoughts and comments on many of these issues, but my time to devote to researching and providing thoughtful comments on these important questions is limited. I have already spent many hours researching and dissecting these issues, but they take time. I know that the FDA took many years to even come up with the Proposed Rule, so I do not think it is at all unreasonable to allow the public a mere six months to comment on it. This is our only opportunity, as consumers, to provide our feedback.

I feel very strongly about e-cigarettes as an alternative to combustible cigarettes. Quite simply, I firmly believe that they saved my life. I wish to provide you with my personal story, as well as science- and evidence-based responses to your questions so that you can take my comment into account. I realize that the FDA has the authority under 21 CFR 10.40 to extend this time frame and that the FDA has exercised this authority on numerous occasions in the past. I would therefore ask that you do so here, so that all stakeholders have the opportunity to provide their comments on this proposed regulation.

I appreciate your consideration of my request and am happy to discuss this issue with you further.


[Federal Register Volume 85, Number 246 (Tuesday, December 22, 2020)]
[Notices]
[Pages 83548-83550]
[FR Doc No: 2020-28250]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket Nos. CP20-528-001; CP20-528-000]

Stingray Pipeline Company, L.L.C.; Notice of Amendment to
Application

    Take notice that on December 11, 2020, Stingray Pipeline Company,
L.L.C. (Stingray), 1300 Main Street, Houston, Texas 77002, filed an
application under section 7(b) of the Natural Gas Act (NGA) and Part
157 of the Commission's regulations seeking authorization to amend its
application in Docket No. CP20-528-000 to abandon certain facilities in
the WC 509 System by removal or in place, rather than by sale to Triton
Gathering LLC (Triton) that were damaged and/or destroyed by Hurricane
Delta. Specifically, Stingray seeks authorization to: (1) Abandon in
place approximately 14.98 miles of 24-inch-diameter pipeline and (2)
abandon by removal its 50 percent ownership interest in the A330
Platform and related equipment, all located in federal waters, offshore
Louisiana, all as more fully set forth in the application which is on
file with the Commission and open for public inspection.
    In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (http://ferc.gov) using the
eLibrary link. Enter the docket number excluding the last three digits
in the docket number field to access the document. At this time, the
Commission has suspended access to the Commission's Public Reference
Room, due to the proclamation declaring a National Emergency concerning
the Novel Coronavirus Disease (COVID-19), issued by the President on
March 13, 2020. For assistance, contact the Federal Energy Regulatory
Commission at<EMAIL_ADDRESS>or call toll-free, (886) 208-
3676 or TYY,<PHONE_NUMBER>.
    Any questions regarding the proposed project should be directed to
Blair Lichtenwalter, Senior Director of Certificates, Stingray Pipeline
Company, L.L.C., 1300 Main Street, Houston, Texas 77002; by phone at
(713) 989-2605 or by email at<EMAIL_ADDRESS>    Pursuant to Section 157.9 of the Commission's Rules of Practice and

Procedure,\1\ within 90 days of this Notice the Commission staff will
either: Complete its environmental review and place it into the
Commission's public record (eLibrary) for this proceeding; or issue a
Notice of Schedule for Environmental Review. If a Notice of Schedule
for Environmental Review is issued, it will indicate, among other
milestones, the anticipated date for the Commission staff's issuance of
the final environmental impact statement (FEIS) or environmental
assessment (EA) for this proposal. The filing of an EA in the
Commission's public record for this proceeding or the issuance of a
Notice of Schedule for Environmental Review will serve to notify
federal and state agencies of the timing for the completion of all
necessary reviews, and the subsequent need to complete all federal
authorizations within 90 days of the date of issuance of the Commission
staff's FEIS or EA.
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    \1\ 18 CFR (Code of Federal Regulations) 157.9.
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Public Participation

    There are two ways to become involved in the Commission's review of
this project: You can file comments on the project, and you can file a
motion to intervene in the proceeding. There is no fee or cost for
filing comments or intervening. The deadline for filing a motion to
intervene is 5:00 p.m. Eastern Time on January 6, 2021.

Comments

    Any person wishing to comment on the project may do so. Comments
may include statements of support or objections to the project as a
whole or specific aspects of the project. The more specific your
comments, the more useful they will be. To ensure that your comments
are timely and properly recorded, please submit your comments on or
before January 6, 2021.
    There are three methods you can use to submit your comments to the
Commission. In all instances, please reference the Project docket
number CP20-528-001 in your submission.
    (1) You may file your comments electronically by using the eComment
feature, which is located on the Commission's website at www.ferc.gov
under the link to Documents and Filings. Using eComment is an easy
method for interested persons to submit brief, text-only comments on a
project;
    (2) You may file your comments electronically by using the eFiling
feature, which is located on the Commission's website (www.ferc.gov)
under the link to Documents and Filings. With eFiling, you can provide
comments in a variety of formats by attaching them as a file with your
submission. New eFiling users must first create an account by clicking
on eRegister. You will be asked to select the type of filing you are
making; first select ``General'' and then select ``Comment on a
Filing''; or
    (3) You can file a paper copy of your comments by mailing them to
the following address below.\2\ Your written comments must reference
the Project docket number (CP20-528-001). Kimberly D. Bose, Secretary,
Federal Energy Regulatory Commission, 888 First Street NE, Washington,
DC 20426.
---------------------------------------------------------------------------

    \2\ Hand delivered submissions in docketed proceedings should be
delivered to Health and Human Services, 12225 Wilkins Avenue,
Rockville, Maryland 20852.
---------------------------------------------------------------------------

    The Commission encourages electronic filing of comments (options 1
and 2 above) and has eFiling staff available to assist you at (202)
502-8258 or [email protected]
    Persons who comment on the environmental review of this project
will be placed on the Commission's environmental mailing list and will
receive notification when the environmental documents (EA or EIS) are
issued for this project and will be notified of meetings associated
with the Commission's environmental review process.
    The Commission considers all comments received about the project in
determining the appropriate action to be taken. However, the filing of
a comment alone will not serve to make the filer a party to the
proceeding. To become a party, you must intervene in the proceeding.
For instructions on how to intervene, see below.

Interventions

    Any person, which includes individuals, organizations, businesses,
municipalities, and other entities,\3\ has the option to file a motion
to intervene in this proceeding. Only intervenors have the right to
request rehearing of Commission orders issued in this proceeding and to
subsequently challenge the Commission's orders in the U.S. Circuit
Courts of Appeal.
---------------------------------------------------------------------------

    \3\ 18 CFR 385.102(d).
---------------------------------------------------------------------------

    To intervene, you must submit a motion to intervene to the
Commission in accordance with Rule 214 of the Commission's Rules of
Practice and Procedure \4\ and the regulations under the NGA \5\ by the
intervention deadline for the project, which is January 6, 2021. As
described further in Rule 214, your motion to intervene must state, to
the extent known, your position regarding the proceeding, as well as
your interest in the proceeding. [For an individual, this could include
your status as a landowner, ratepayer, resident of an impacted
community, or recreationist. You do not need to have property directly
impacted by the project in order to intervene.] For more information
about motions to intervene, refer to the FERC website at https://www.ferc.gov/resources/guides/how-to/intervene.asp.
---------------------------------------------------------------------------

    \4\ 18 CFR 385.214.
    \5\ 18 CFR 157.10.
---------------------------------------------------------------------------

    There are two ways to submit your motion to intervene. In both
instances, please reference the Project docket number CP20-528-001 in
your submission.
    (1) You may file your motion to intervene by using the Commission's
eFiling feature, which is located on the Commission's website
(www.ferc.gov) under the link to Documents and Filings. New eFiling
users must first create an account by clicking on eRegister. You will
be asked to select the type of filing you are making; first select
General and then select Intervention. The eFiling feature includes a
document-less intervention option; for more information, visit https://www.ferc.gov/docs-filing/efiling/document-less-intervention.pdf.; or
    (2) You can file a paper copy of your motion to intervene, along
with three copies, by mailing the documents to the address below.\6\
Your motion to intervene must reference the Project docket number CP20-
528-001. Kimberly D. Bose, Secretary, Federal Energy Regulatory
Commission, 888 First Street NE, Washington, DC 20426.
---------------------------------------------------------------------------

    \6\ Hand delivered submissions in docketed proceedings should be
delivered to Health and Human Services, 12225 Wilkins Avenue,
Rockville, Maryland 20852.
---------------------------------------------------------------------------

    The Commission encourages electronic filing of motions to intervene
(option 1 above) and has eFiling staff available to assist you at (202)
502-8258 or [email protected]
    Motions to intervene must be served on the applicant either by mail
or email at: 1300 Main Street, Houston, Texas 77002 or at
<EMAIL_ADDRESS>Any subsequent submissions by
an intervenor must be served on the applicant and all other parties to
the proceeding. Contact information for parties can be downloaded from
the service list at the eService link on FERC Online. Service can be
via email with a link to the document.
    All timely, unopposed \7\ motions to intervene are automatically
granted by operation of Rule 214(c)(1).\8\ Motions to

intervene that are filed after the intervention deadline are untimely
and may be denied. Any late-filed motion to intervene must show good
cause for being late and must explain why the time limitation should be
waived and provide justification by reference to factors set forth in
Rule 214(d) of the Commission's Rules and Regulations.\9\ A person
obtaining party status will be placed on the service list maintained by
the Secretary of the Commission and will receive copies (paper or
electronic) of all documents filed by the applicant and by all other
parties.
---------------------------------------------------------------------------

    \7\ The applicant has 15 days from the submittal of a motion to
intervene to file a written objection to the intervention.
    \8\ 18 CFR 385.214(c)(1).
    \9\ 18 CFR 385.214(b)(3) and (d).
---------------------------------------------------------------------------

Tracking the Proceeding

    Throughout the proceeding, additional information about the project
will be available from the Commission's Office of External Affairs, at
(866) 208-FERC, or on the FERC website at www.ferc.gov using the
eLibrary link as described above. The eLibrary link also provides
access to the texts of all formal documents issued by the Commission,
such as orders, notices, and rulemakings.
    In addition, the Commission offers a free service called
eSubscription which allows you to keep track of all formal issuances
and submittals in specific dockets. This can reduce the amount of time
you spend researching proceedings by automatically providing you with
notification of these filings, document summaries, and direct links to
the documents. For more information and to register, go to
www.ferc.gov/docs-filing/esubscription.asp.
    Intervention Deadline: 5:00 p.m. Eastern Time on January 6, 2021.

    Dated: December 16, 2020.
Kimberly D. Bose,
Secretary.
[FR Doc. 2020-28250 Filed 12-21-20; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 76, Number 78 (Friday, April 22, 2011)]
[Notices]
[Pages 22695-22696]
[FR Doc No: 2011-9809]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER11-3370-000]

Phalanx Energy Services, LLC; Supplemental Notice That Initial
Market-Based Rate Filing Includes Request for Blanket Section 204
Authorization

    This is a supplemental notice in the above-referenced proceeding of
Phalanx Energy Services, LLC's application for market-based rate
authority, with an accompanying rate tariff, noting that such
application includes a request for blanket authorization, under 18 CFR

part 34, of future issuances of securities and assumptions of
liability.
    Any person desiring to intervene or to protest should file with the
Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426, in accordance with Rules 211 and 214 of the
Commission's Rules of Practice and Procedure (18 CFR 385.211 and
385.214). Anyone filing a motion to intervene or protest must serve a
copy of that document on the Applicant.
    Notice is hereby given that the deadline for filing protests with
regard to the applicant's request for blanket authorization, under 18
CFR part 34, of future issuances of securities and assumptions of
liability, is May 9, 2011.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with Internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically should submit an original and
14 copies of the intervention or protest to the Federal Energy
Regulatory Commission, 888 First Street, NE., Washington, DC 20426.
    The filings in the above-referenced proceeding are accessible in
the Commission's eLibrary system by clicking on the appropriate link in
the above list. They are also available for review in the Commission's
Public Reference Room in Washington, DC. There is an eSubscription link
on the Web site that enables subscribers to receive e-mail notification
when a document is added to a subscribed docket(s). For assistance with
any FERC Online service, please e-mail<EMAIL_ADDRESS>or
call<PHONE_NUMBER> (toll free). For TTY, call<PHONE_NUMBER>.

    Dated: April 18, 2011.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2011-9809 Filed 4-21-11; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: July 17, 2009 (Volume 74, Number 136)]
[Notices]
[Page 34822-34826]
[DOCID:fr17jy09-122]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60289; File No. SR-NYSE-2009-68]

Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by New York Stock Exchange LLC
Amending NYSE Rules 60, 70 and 1000 To Reflect Modifications to the
Manner in Which the Exchange Will Quote and Trade With Respect to
Liquidity Replenishment Points

July 10, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on July 9, 2009, New York Stock Exchange LLC (``NYSE'' or
the ``Exchange'') filed with the Securities and Exchange Commission
(the ``Commission'') the proposed rule change as described in Items I
and II below, which Items have been prepared by the self-regulatory
organization. The Exchange filed the proposed rule change pursuant to
Section 19(b)(3)(A) of the Act \4\ and Rule 19b-4(f)(6) thereunder,\5\
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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 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 proposes to amend NYSE Rules 60 (Dissemination of
Quotations), 70 (Execution of Floor-Broker Interest) and 1000
(Automatic Executions) to reflect modifications to the manner in which
the Exchange will quote and trade with respect to Liquidity
Replenishment Points. The text of the proposed rule change is available
at the Exchange, 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 self-regulatory organization
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
Statutory Basis for, the Proposed Rule Change

1. Purpose
    New York Stock Exchange LLC (``NYSE'' or the ``Exchange'') proposes
to amend Exchange Rules 60 (Dissemination of Quotations), 70 (Execution
of Floor Broker Interest) and 1000 (Automatic Executions) to reflect
modifications to the manner in which the Exchange will quote and trade
with respect to Liquidity Replenishment Points (``LRPs'').\6\ As
proposed, LRPs will convert the Display Book to an auction market by
causing autoquote to be suspended only when an LRP is reached that will
result in a locked or crossed market condition on the Exchange or with
respect to an away market center (``lock/cross'') or where the next
action required is to consummate a trade. Once the locked/crossed
condition is cleared or the required trade is consummated, the
automatic quoting and executions will resume immediately without any
pre-set timing delays. As such, the proposal will allow Exchange
systems to quote interest through an LRP price point without converting
the Exchange market to an auction market where the next required action
is simply to quote the interest.
---------------------------------------------------------------------------

    \6\ LRPs are pre-determined price points that temporarily
convert the automatic Exchange market to an auction market in order
to dampen volatility when the market is experiencing a large price
movement based on a security's typical trading characteristics or
market conditions over short periods of time during the trading day.
LRPs allow the DMM to solicit additional liquidity.
---------------------------------------------------------------------------

    The Exchange notes that parallel changes are proposed to be made to
the rules of the NYSE Amex LLC (formerly the American Stock
Exchange).\7\
---------------------------------------------------------------------------

    \7\ See SR-NYSEAmex-2009-39.
---------------------------------------------------------------------------

a. Background
    The Exchange uses LRPs to temporarily convert the automatic
Exchange market to an auction market in order to dampen volatility when
the market is experiencing a large price movement based on a security's
typical trading characteristics or market conditions over short periods
of time during the trading day. For example, a large sized order on one
side of the market, or a series of orders that will trade beyond the
current market could cause the price of a security to move to its
current LRP value. Conversion to an auction market as a result of an
LRP allows the Exchange to solicit additional liquidity.
    Floor broker interest with discretionary trading instructions (``d-
Quotes'') is prohibited from triggering an LRP. Specifically, a d-Quote
participating in a sweep transaction cannot use its price discretion to
trade at a price that would trigger an LRP.\8\ d-Quotes were designed
in this manner so they would not cause the Exchange's market to ``go
slow'' by triggering an LRP. It should also be noted that a d-Quote
cannot cause a lock/cross market because the d-Quote only trades at
prices within its designated discretion but does not quote at a price
using its price discretion.
---------------------------------------------------------------------------

    \8\ Exchange systems automatically prevent a d-Quote from using
its price discretion to trade at an LRP price.
---------------------------------------------------------------------------

b. Functioning of Autoquote and Auomatic [sic] Executions
    Autoquote is a part of the Display Book[reg] \9\ that immediately
displays customer limit orders received on the Exchange. When autoquote
is suspended, it is suspended on both sides of the market. The Exchange
will publish a ``slow'' quote (i.e., one that is not eligible for
automatic execution) when autoquote is suspended. The Exchange can also
publish a slow quote on one side of the market, under certain market
conditions, such as when there is no interest on one side of the
market.
---------------------------------------------------------------------------

    \9\ The Display Book[reg] system is an order management and
execution facility. The Display Book system receives and displays
orders to the DMMs, contains the Book, and provides a mechanism to
execute and report transactions and publish the results to the
Consolidated Tape. The Display Book system is connected to a number
of other Exchange systems for the purposes of comparison,
surveillance, and reporting information to customers and other
market data and national market systems.
---------------------------------------------------------------------------

    Pursuant to NYSE Rule 60, autoquote is suspended when an LRP is
reached and resumes in no more than ten seconds after the LRP is
reached. Specifically, NYSE Rule 60(d)(ii)(C) provides that autoquoting
is suspended when an LRP is reached, that is, if an automatic execution
would take place at or beyond an LRP. When autoquoting is suspended in
this situation, the Display Book ``goes slow'', i.e., quotes and
trading in that security do not take place automatically. Pursuant to
current Rule 60, autoquoting will resume in no more than ten seconds
(but usually in five seconds) after an LRP is reached. Autoquoting
resumes unless there is interest on the Display Book system that would
lock/cross the market. In such case, autoquoting will resume following
a manual transaction.
    For example, if the market on the Exchange for a security is 20.10
bid and 20.15 offered. The designated LRP for this security is at a
price of 20.15 on the offer side. A buy order is received to lift the
offer at 20.15. Exchange systems will execute the buy order against the
interest at 20.15 and then suspend autoquote. Autoquote resumes in no
more than ten seconds unless there is interest on the NYSE Display Book
system that would lock/cross the market. An example of this would be if
in the same market situation after autoquote suspended, interest
arrived to sell below the bid price (e.g., sell at 20.09 or below), the
market would be ``crossed''. In such case, autoquote will resume after
a manual transaction, conducted by the DMM to trade out of the cross
market and resume automatic quoting.
    Similarly, pursuant to NYSE Rule 1000(a)(iv), automatic executions
are suspended when an LRP is reached, and resume pursuant to the same
parameters for the resumption of autoquote. Automatic executions on the
Exchange are suspended when autoquote is suspended. In certain
instances, autoquote is available to disseminate a slow quote. This may
occur on either the bid or offer side or both sides of the market. In
instances when autoquote is disseminating a slow quote, auto executions
will not be available against the quote that is slow.

    Pursuant to current NYSE Rules, once an LRP is reached interest may
not quote through the price point. For example the Exchange market is
500 shares bid 20.10 and 300 shares offered at 20.15. The designated
LRP for this security is at a price of 20.15 on the offer side. An
order to buy 600 shares with a limit price of 20.16 is received. There
is no interest offered on the Display Book at 20.16. The next offer is
400 shares at 20.20. The order will execute 300 shares at 20.15.
Thereafter, autoquote and automatic executions will be suspended. No
more than ten seconds later, the quote will be updated to reflect the
new bid price of 20.16 and the new offer price of 20.20 and auto quote
and auto execution will resume.
    Similarly, pursuant to current NYSE Rules interest may also not
trade through the price point. Again, the Exchange market is 500 shares
bid 20.10 and 300 shares offered at 20.15. The designated LRP for this
security is at a price of 20.15 on the offer side. An order to buy 600
shares with a limit price of 20.16 is received. There are 200 shares
offered on the Display Book at 20.16 and the next offer on the Display
Book is for 400 shares at 20.20. The order will execute 300 shares at
20.15. Thereafter, autoquote and automatic executions will be
suspended. The DMM will manually execute an additional 200 shares of
the order at 20.16 and auto quote and auto execution will resume. The
Exchange quote will be updated to reflect 100 shares bid at 20.16 and
400 shares offered at the price of 20.20.
c. Proposed Amendment to NYSE Rules
    In order to have the Exchange market increase the amount of
continuous automatic quoting and executions, it is proposed to reduce
the number of situations when an LRP converts the Exchange to a manual
market. The Exchange is proposing to allow Exchange systems to quote
interest through an LRP price point without converting the Exchange
market to an auction market where the next required action is simply to
quote. In the event a trade is required after reaching an LRP, the
Exchange market will continue to be converted to an auction market.
    In instances where the next action after the LRP would be to quote
because there is no interest capable of trading at the relevant price
point, the Exchange proposes to have the Display Book[supreg] maintain
fast market conditions and not convert to a manual market for any
period of time. Rather, interest will be immediately and automatically
quoted and available for automatic executions. As proposed, an LRP will
convert the Display Book to an auction market when an automated quote
following such LRP would result in a locked/crossed market condition.
Once the locked/crossed condition is cleared, automatic quoting and
executions will resume immediately without any pre-set timing delays.
    The Exchange believes that in certain situations, when an LRP is
reached, and there is not a locked/crossed market situation, keeping
autoquote active is beneficial to the market since interest on the
Display Book will continue to be autoquoted, and therefore available
for automatic executions.\10\ For example, suppose the market on the
NYSE is 20.10 bid and 20.15 offered, last sale at 19.90, with the
current LRP for this security at 20.15 on the offer side since the LRP
is .25. If there is incoming interest that would trade up to the .15
offer, and there is interest on the Display Book to sell at .16, the
Exchange believes the .16 offer should be eligible for autoquoting and,
therefore, automatic execution, rather than the Exchange's market
having to go slow.
---------------------------------------------------------------------------

    \10\ The Exchange notes that in its experience it does not often
receive additional liquidity in the prescribed amount of time during
LRP situations where the next required action is to quote the
remaining interest, and, therefore, the Exchange believes that
allowing for the continuation of autoquoting will be beneficial to
its market.
---------------------------------------------------------------------------

    Therefore, the Exchange proposes to amend NYSE Rule 60(d) to allow
autoquote to continue when an LRP is reached if the market on the
Exchange is not locked/crossed. For example the Exchange market is 500
shares bid 20.10 and 300 shares offered at 20.15. The designated LRP
for this security is at a price of 20.15 on the offer side. An order to
buy 600 shares with a limit price of 20.16 is received. There is no
interest offered on the Display Book at 20.16. The next offer is 400
shares at 20.20. The order will execute 300 shares at 20.15. Autoquote
and automatic executions will not be suspended. Thereafter autoquote
will reflect the new quote of 300 shares bid at a price of 20.16 and
400 shares offered at a price of 20.20.
    Pursuant to the proposal, there will be no interruption of
autoquote unless the market would be locked/crossed by the interest
that would be autoquoted. Moreover, Exchange systems will still not
allow the Display Book to trade through an LRP. As such, if the
Exchange market is 500 shares bid 20.10 and 300 shares offered at
20.15. The designated LRP for this security is at a price of 20.15 on
the offer side. An order to buy 600 shares with a limit price of 20.16
is received. There are 200 shares offered on the Display Book at 20.16
and the next offer on the Display Book is 400 shares at 20.20. The
order will execute 300 shares at 20.15. Thereafter, autoquote and
automatic executions will be suspended as it is today. The DMM must
intervene to execute the additional 200 shares of the order at 20.16.
Autoquoting will also resume as soon as a locked/crossed market is
cleared by a manual execution or cancellation of the locking/crossing
interest.\11\
---------------------------------------------------------------------------

    \11\ The Exchange is working on technology to replicate certain
manual functions currently done by the individual DMM, including
trading out of LRPs that would lock/cross the market. The proposed
change to Rule 60(d) will thus have the effect of providing for the
resumption of Autoquoting when a locked/crossed market is cleared
manually or automatically.
---------------------------------------------------------------------------

    The Exchange further proposes to amend NYSE Rule 1000(a)(iv) to
allow for the continuation of automatic execution unless (a) any
residual interest of the executing order is locking/crossing the market
on the Exchange; or (b) if the resulting bid or offer is beyond the
revised LRP in that security. NYSE Rule 1000(a)(iv) will further be
amended to suspend automatic executions only on the side of the market
that is quoted beyond the newly calculated LRP, except that undisplayed
reserve orders at price points before the LRP will continue to be
eligible for automatic executions.
    For example, suppose the market on the NYSE is 20.10 bid and 20.15
offered, with an LRP Parameter of .25. The designated LRP for this
security is at a price of 20.15 on the offer side. An incoming buy
order limited to 20.15 is entered. It trades up to the 20.15 offer with
residual shares to be executed. There is no other sell interest on the
Display Book until 20.45. An LRP will be calculated based on the last
sale price of 20.15 (i.e., last sale of 20.15 plus the .25 LRP
parameter equals 20.40). The offer will be published as slow since it
is beyond the newly calculated offer side LRP of 20.40 (last sale of
20.15 plus .25). The bid will remain fast since the bid side LRP is
calculated as 19.90 (last sale of 20.15 minus .25). The offer will stay
slow until new interest arrives to quote within the LRP, the LRP is
recalculated off of a new trade or the DMM intervenes and trades
manually.
    Finally, the Exchange proposes to amend NYSE Rule 70.25(d)(ix)(A)
to remove the restriction that a d-Quote participating in a sweep
transaction must stop within one minimum price variation, for most
Exchange securities, one cent, of a security's LRP. Given the proposed
modification to LRP functionality, allowing d-Quotes to trade at an LRP
price will not cause the Exchange's market to go slow if the next

action will be a quote. For example, presume the market is 20.05 bid
and offered at 20.10, with the security's LRP on the sell side set at
20.13, but with interest on the Display Book to sell higher than the
LRP. If a d-Quote to buy has three cents maximum discretion, it would
not be able to trade at 20.13 under current rules since this price is a
LRP price point. However, since there is interest eligible to be quoted
beyond the LRP, under the proposed rule changes allowing the d-Quote to
use its maximum discretion to trade at 20.13 would not cause the market
to go slow. Therefore, the restriction on the d-quote trading at the
LRP no longer serves its original purpose. As such, the Exchange
proposes to remove said restriction.
    The Exchange will commence implementation of the systemic changes
to allow Exchange systems to quote interest through an LRP price point
without converting the Exchange market to an auction market where the
next required action is simply to quote the interest on or about July
10, 2009. The Exchange intends to progressively implement this systemic
change for LRPs on a security by security basis as it gains experience
with the new technology until it is operative in all securities traded
on the Floor. During the implementation, the Exchange will identify on
its Web site which securities have been transitioned to the new system.
    In addition to the substantive change proposed above, the Exchange
further proposes to make a technical amendment to NYSE Rule 1000 to
delete a reference to the timing of the beginning of the New Market
Model Pilot \12\ from the preliminary provisions of Rule 1000 since
this Pilot has been underway for a number of months.
---------------------------------------------------------------------------

    \12\ See Securities Exchange Act Release No. 58845 (October 24,
2008), 73 FR 64379 (October 29, 2008) (SR-NYSE-2008-46).
---------------------------------------------------------------------------

2. Statutory Basis
    The basis under the Securities Exchange Act of 1934 (the ``Act'')
\13\ for these proposed rule changes is the requirement under Section
6(b)(5) \14\ 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.
The proposed rule change also is designed to support the principles of
Section 11A(a)(1) \15\ in that it seeks to assure economically
efficient execution of securities transactions, make it practicable for
brokers to execute investors' orders in the best market and provide an
opportunity for investors' orders to be executed without the
participation of a dealer. The Exchange's proposal to maintain fast
market conditions more often is consistent with the principles above in
that it will increase the amount of time that the Exchange's quote is
eligible for immediate and automatic executions.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78a.
    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 15 U.S.C. 78k-1(a)(1).
---------------------------------------------------------------------------

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 with respect to 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, 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\
---------------------------------------------------------------------------

    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the self-regulatory organization to submit to 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 satisfied this requirement.
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    The Exchange has requested that the Commission waive the 30-day
operative delay in order to permit the Exchange to immediately
implement the modifications to its systems discussed in full above,
which should permit the Exchange to maintain fast market conditions
more often, thus increasing the amount of time that the Exchange's
quote is eligible for automatic executions. The Commission believes
such waiver is consistent with the protection of investors and the
public interest. \18\ Accordingly, the Commission designates the
proposed rule change operative upon filing with the Commission.
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    \18\ 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. See 15
U.S.C. 78c(f).
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    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.

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<EMAIL_ADDRESS>Please include
File Number SR-NYSE-2009-68 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSE-2009-68. 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 on official business
days between the hours of 10 a.m. and 3 p.m. Copies of such filing also
will be available for

inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSE-2009-68 and should be
submitted on or before August 7, 2009.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. E9-17015 Filed 7-16-09; 8:45 am]

BILLING CODE 8010-01-P