[Federal Register: June 23, 2006 (Volume 71, Number 121)]
[Notices]
[Page 36145-36155]
[DOCID:fr23jn06-76]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53995; File No. SR-NYSEArca-2006-13]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change and Amendments No. 1 and 2 Thereto Establishing
the OX Trading Platform

June 15, 2006.
    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 May 2, 2006, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'') filed
with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II and III below, which
Items have been prepared by the Exchange. The Exchange filed Amendments
No. 1 \3\ and 2 \4\ to the proposed rule change on June 6, 2006 and
June 15, 2006, respectively. The Commission is publishing this notice,
as amended, 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    \3\ Amendment No. 1, which replaced and superseded the original
filing in its entirety, is incorporated in this notice.
    \4\ Amendment No. 2 clarified the circumstances under which
orders received by OX would be routed away using Linkage or
Archipelago Securities. Amendment No. 2 also made minor changes to
the proposed rule text. Amendment No. 2 is incorporated in this
notice.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    NYSE Arca proposes to amend its rules governing the trading of
listed options on NYSE Arca. With this filing, the Exchange proposes to
adopt new rules for the implementation of a new trading platform for
options, OX.
    The text of the proposed rule change is available on the Exchange's
Web site at http://www.archipelago.com, at the Exchange's Office of the

Secretary, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV 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

A. Summary and Purpose of the Rule Changes Related to the
Implementation of OX

    NYSE Arca proposes to establish rules for OX, a fully automated
trading system for standardized equity options intended to replace NYSE
Arca's current options trading platform, PCX Plus.\5\ OX

would provide automatic order execution capabilities in the options
securities listed and traded on NYSE Arca. Market Makers would be able
to stream quotes to OX from on the trading floor or remotely.
---------------------------------------------------------------------------

    \5\ See NYSE Arca Rule 6.90.
---------------------------------------------------------------------------

    1. Description of OX
    a. Access. OX would be available for the entry and execution of
quotes and orders to OTP Holders,\6\ OTP Firms \7\ and, through
Sponsoring OTP Firms,\8\ certain non-OTP Firms and Holders, such as
institutional investors (collectively, ``Users'').
---------------------------------------------------------------------------

    \6\ See NYSE Arca Rule 1.1(q).
    \7\ See NYSE Arca Rule 1.1(r).
    \8\ See proposed NYSE Arca Rule 6.1A(a)(17).
---------------------------------------------------------------------------

    b. Method of Operation. In general, Users would be able to enter
market orders, marketable limit orders and limit orders. Only Market
Makers would be permitted to enter quotes on OX. As Users enter bids
and offers (i.e., orders and quotes) into the system, any non-
marketable limit orders and quotes would be ranked in an electronic
limit order file (the ``OX Book'') according to price-time priority,
such that within each price level, all bids and offers are organized by
the time of entry. The OX Book (except for certain working orders with
conditional prices or sizes) would be displayed to all Users. For
market orders or marketable limit orders, like-priced bids and offers
would be matched by OX for execution at prices equal to or better than
the NBBO pursuant to the following algorithm, which is based on price-
time priority:
    Step 1: All market orders and marketable limit orders would be
matched against the displayed top of the OX Book.
    Step 2: If an order has not been executed in its entirety pursuant
to Step 1, then OX would match the order against any working orders,
which are orders with a conditional or undisplayed price and/or size.
For example, a reserve order, an order with a portion of the size
displayed and reserve portion of the size that is not displayed, is a
working order.
    Step 3: If an order has not been executed in its entirety pursuant
to Steps 1 and 2, the order would be routed to another Market Center
\9\ for execution, unless the User has indicated that the order must
not be routed to another market (i.e., by designating an order as a
``post no preference'' or ``PNP'' order). If an order that is routed to
another market is not executed in its entirety, the order would be
ranked and displayed in the OX Book in accordance with the terms of
such order pursuant to proposed NYSE Arca Rule 6.76A and such order
would be eligible for execution pursuant to proposed NYSE Arca Rule
6.76B.
---------------------------------------------------------------------------

    \9\ See proposed NYSE Arca Rule 6.1A(a)(6).
---------------------------------------------------------------------------

    2. Market Maker Participation. OTP Holders and OTP Firms would be
permitted to register as either Lead Market Makers (``LMMs'') or Market
Makers in one or more securities traded on OX (unless specified, or
unless the context requires otherwise, the term Market Maker as used
herein refers to both Market Makers and LMMs). No more than one LMM
would be appointed in each option class. If registered as Market
Makers, the transactions of such OTP Firms and OTP Holders ``should
constitute a course of dealings reasonably calculated to contribute to
the maintenance of a fair and orderly market, and no Market Maker
should enter into transactions or make bids or offers that are
inconsistent with such a course of dealings.'' Specifically, a Market
Maker would be required to, among other things, compete with other
Market Makers to improve the market in all series of options classes to
which the Market Maker is appointed, update market quotations in
response to changed market conditions in all series of options classes
within its appointed classes, honor its quotations, maintain
continuous, two-sided quotes in a specified percentage of its appointed
classes, submit quotations in accordance with maximum Exchange
prescribed width requirements, and trade a minimum percentage of its
contracts in its appointed classes. A Market Maker's failure to meet
these obligations may lead to a suspension, termination or other
restriction of the Market Maker's registration in one or more
securities or the OTP Firm's or OTP Holder's right to act as a Market
Maker. LMMs would continue to be responsible for Intermarket Option
Linkage (``Linkage'') order handling obligations.

B. Detailed Summary of Proposed Rule Change

    The proposed rule changes are located in NYSE Arca Rule 2 (Options
Trading Permits) and NYSE Arca Rule 6 (Options Trading).
    1. NYSE Arca Rule 2--Options Trading Permits.
    Proposed amendment to NYSE Arca Rule 2.5. Because NYSE Arca does
not intend to make significant changes to membership requirements once
OX is implemented, NYSE Arca proposes to amend NYSE Arca Rule 2.5 such
that current members of the Exchange and their associated persons that
have met the Exchange's membership requirements and passed the
requisite examinations would automatically be qualified to engage in
the same activities on OX for which they were previously approved by
the Exchange.
    2. NYSE Arca Rule 6--Options Trading.
    Proposed amendments to NYSE Arca Rule 6.1(a). Because option issues
would be rolled-out on OX over a period of time, NYSE Arca proposes to
amend NYSE Arca Rule 6.1(a) to clarify that rules related to option
contracts traded on the existing PCX Plus trading platform would apply
to options trading on PCX Plus and proposed new rules for option
contracts that would trade on OX would apply only to such transactions.
Existing and amended rules that do not specify a trading platform would
apply to all relevant transactions made on NYSE Arca.

Proposed NYSE Arca Rule 6.1A

    In connection with the implementation of OX, NYSE Arca proposes to
adopt definitions applicable to activity on OX. The most significant of
the proposed definitions are as follows:
    a. Proposed NYSE Arca Rule 6.1A(a)(10). NOW Recipients. As
described further below, NYSE Arca proposes to add ``NOW Order'' as a
new order type. Users would be permitted to designate orders entered on
OX as ``NOW Orders.'' NOW Orders are limit orders that would be
executed in whole or in part on OX. Any portion of such orders not
executed on OX would be routed to one or more ``NOW Recipients'' for
immediate execution. ``NOW Recipients'' would include any Market Center
(1) with which NYSE Arca maintains an electronic linkage, and (2) that
provides instantaneous responses to NOW Orders routed from OX. NYSE
Arca would designate those Market Centers that qualify as NOW
Recipients and periodically publish such information via its Web site.
Any portion of a NOW Order not immediately executed by the NOW
Recipient would be cancelled. If a NOW Order is not marketable when it
is submitted to OX, it would be cancelled.
    NOW Orders would allow Users to have their orders executed as
quickly as possible by allowing them to choose to have their orders
sent only to those Market Centers that are automated, as that term is
generally understood to mean, and that do not allow for manual
intervention. Through the creation of ``NOW Recipients'' and ``NOW
Orders,'' Users' orders that are routed away would be executed as
quickly as possible while the possibility that such orders would
``miss'' the away market would be reduced.

    b. Proposed NYSE Arca Rule 6.1A(a)(15). OX Routing Broker.
    NYSE Arca is proposing to add a definition for ``OX Routing
Broker,'' NYSE Arca's broker-dealer affiliate, Archipelago Securities
LLC (``Archipelago Securities''), which NYSE Arca intends to use to
route orders, subject to NYSE Arca rules, to other Market Centers. The
OX Routing Broker would offer Users a fast alternative for routing
orders to other Market Centers for execution.
    Archipelago Securities is a wholly-owned subsidiary of Archipelago
Holdings Inc. and is a registered broker-dealer and a member of NASD.
Archipelago Securities is a ``facility'' of NYSE Arca as that term is
defined in Section 3(a)(2) of Act.\10\ Specifically, Section 3(a)(2) of
the Act provides that, ``[t]he term `facility' when used with respect
to an exchange includes its premises, tangible or intangible property
whether on the premises or not, any right to use of such premises or
property or any service thereof for the purpose of effecting or
reporting a transaction on the exchange (including, among other things,
any system of communication to or from the exchange, by ticket or
otherwise maintained by or with the consent of the exchange), and any
right of the exchange to the use of any property or service.''
Accordingly, because Archipelago Securities functions as an order
routing mechanism for NYSE Arca, it operates as a ``system of
communication'' to and from NYSE Arca for purposes of effecting
transactions on NYSE Arca. NYSE Arca would be responsible for
regulating the OX order routing function of Archipelago Securities as
an exchange facility, subject to Section 6 of the Act.\11\ Archipelago
Securities' order routing function would also be subject to the
Commission's continuing oversight. In particular, under the Act, any
proposed rule change relating to Archipelago Securities' order-routing
function would be filed with the Commission and Archipelago Securities
would be subject to exchange non-discrimination requirements.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78c(a)(2).
    \11\ 15 U.S.C. 78f.
---------------------------------------------------------------------------

    OX would use either Archipelago Securities or Linkage to route
orders to other Market Centers. Generally, non-customer orders (e.g.,
broker-dealer orders and Market Maker orders) and NOW Orders would be
routed to other Market Centers via Archipelago Securities. P/A orders
\12\ would be routed to other Market Centers via Linkage. The OX system
would not automatically generate Principal orders \13\ on behalf of
Market Makers; rather, Market Makers would be required to enter their
own Principal orders if they want to have their proprietary orders
routed to other Market Centers via Linkage. Certain order types,
including Immediate or Cancel and PNP Orders, would not be eligible for
routing away. Users, therefore, would be able to control whether
certain orders may be routed away by these order designations.
---------------------------------------------------------------------------

    \12\ See NYSE Arca Rule 6.92(a)(12)(i).
    \13\ See NYSE Arca Rule 6.92(a)(12)(ii).
---------------------------------------------------------------------------

    OX would determine whether to route certain orders via Linkage or
Archipelago Securities based on preset parameters in its automated
routing algorithm. Accordingly, orders that would be eligible for
routing over Linkage (e.g., public customer orders) could be routed to
other Market Centers as P/A orders via Linkage or as customer orders
via Archipelago Securities based on the automated routing algorithm
parameters.
    c. Proposed NYSE Arca Rules 6.1A(a)(16), (17) and (18).
    Sponsored Participant, Sponsoring OTP Firm and Sponsorship
Provisions. As described further below, NYSE Arca is proposing to add
the concept of Sponsored Participants and Sponsoring OTP Firms.
Sponsored Participants would be able to access OX for purposes of order
entry and execution.

Proposed NYSE Arca Rule 6.2A

    NYSE Arca is proposing NYSE Arca Rule 6.2A to govern access to OX
and the expected conduct of OTP Holders, OTP Firms and persons employed
by or associated with an OTP Holder or OTP Firm. OTP Holders, OTP Firms
and persons employed by or associated with any OTP Holder or OTP Firm,
while using the facilities of NYSE Arca, would not be permitted to
engage in conduct: (i) Inconsistent with the maintenance of a fair and
orderly market; (ii) apt to impair public confidence in the operations
of NYSE Arca; or (iii) inconsistent with the ordinary and efficient
conduct of business. Activities that may violate these provisions would
include, but would not be limited to: (a) Failure of a Market Maker to
provide quotations in accordance with NYSE Arca Rules 6.37A and 6.37B;
(b) failure of a Market Maker to bid or offer within the ranges
specified by NYSE Arca Rule 6.37A; (c) failure of an OTP Holder or OTP
Firm to adequately supervise a person employed by or associated with
such OTP Holder or OTP Firm to ensure that person's compliance with
NYSE Arca Rules; (d) failure to abide by a determination of NYSE Arca;
and (e) refusal to provide information requested by NYSE Arca.
    In addition to the above, proposed NYSE Arca Rule 6.2A also
outlines the requirements that Sponsored Participants and Sponsoring
OTP Firms would be required to meet prior to engaging in a Sponsoring
OTP Firm/Sponsored Participant relationship. A ``Sponsored
Participant'' would be a person, such as an institutional investor, who
has entered into a sponsorship arrangement with an OTP Firm for
purposes of entering orders on OX. The following would be the
requirements for access by Sponsored Participants:
    Sponsored Participants would be required to enter into a
sponsorship arrangement with a ``Sponsoring OTP Firm,'' which is
defined as an OTP Firm that has been designated by a Sponsored
Participant to execute, clear and settle transactions on NYSE Arca. The
sponsorship arrangement consists of three separate components. First,
the Sponsored Participant would have to enter into and maintain a
customer agreement with its Sponsoring OTP Firm, establishing a proper
relationship and account through which the Sponsored Participant would
be permitted to trade on NYSE Arca. Second, the Sponsored Participant
and its Sponsoring OTP Firm would have to enter into a written
agreement that incorporates the following Sponsorship Provisions:
    (1) The Sponsoring OTP Firm acknowledges and agrees that: (i) All
orders entered by its Sponsored Participant and any person acting on
behalf of or in the name of such Sponsored Participant and any
executions occurring as a result of such orders are binding in all
respects on the Sponsoring OTP Firm and (ii) the Sponsoring OTP Firm is
responsible for any and all actions taken by such Sponsored Participant
and any person acting on behalf of or in the name of such Sponsored
Participant.
    (2) The Sponsored Participant agrees that it would comply with the
NYSE Arca Certificate of Incorporation, Bylaws, Rules and procedures
with regard to its activity on the Exchange as if the Sponsored
Participant were an OTP Firm.
    (3) The Sponsored Participant agrees that it would maintain, keep
current and provide to the Sponsoring OTP Firm a list of its Authorized
Traders \14\ who would be permitted to obtain access to the Exchange on
behalf of the Sponsored Participant(s).
---------------------------------------------------------------------------

    \14\ See proposed NYSE Arca Rule 6.1A(a)(1).
---------------------------------------------------------------------------

    (4) The Sponsored Participant agrees that it would familiarize its
Authorized

Traders with all of the Sponsored Participant's obligations under NYSE
Arca Rules and would assure that they receive appropriate training
prior to any use of or access to the Exchange.
    (5) The Sponsored Participant agrees that it would not permit
anyone other than Authorized Traders to use or obtain access to the
Exchange.
    (6) The Sponsored Participant agrees that it would take reasonable
security precautions to prevent unauthorized use or access to the
Exchange, including unauthorized entry of information into OX, or the
information and data made available therein. The Sponsored Participant
understands and agrees that it is responsible for any and all orders,
trades and other messages and instructions entered, transmitted or
received under identifiers, passwords and security codes of Authorized
Traders, and for the trading and other consequences thereof.
    (7) The Sponsored Participant acknowledges its responsibility for
establishing adequate procedures and controls that permit it to
effectively monitor its employees, agents and customers' use of and
access to the Exchange for compliance with the terms of the Sponsorship
Provisions.
    (8) The Sponsored Participant agrees that it would pay when due all
amounts, if any, payable to the Sponsoring OTP Firm, NYSE Arca or any
other third parties that arise from the Sponsored Participant's access
to and use of the Exchange. Such amounts would include, but would not
be limited to, applicable exchange and regulatory fees.
    Third, the Sponsoring OTP Firm would have to provide NYSE Arca with
a ``Notice of Consent,'' which acknowledges the Sponsoring OTP Firm's
responsibility for the orders, executions and actions of its Sponsored
Participant.
    As a further condition to access to the Exchange, each OTP Firm
would be required to maintain an up-to-date list of persons who could
obtain access to the Exchange on behalf of the OTP Firm or the OTP
Firm's Sponsored Participants, i.e., Authorized Traders, and provide
the list to NYSE Arca upon request. In addition, each OTP Firm would
have to have reasonable procedures to ensure that all of its Authorized
Traders maintain the physical security of NYSE Arca and otherwise
comply with NYSE Arca Rules. If NYSE Arca determines that an Authorized
Trader has caused an OTP Firm to violate NYSE Arca Rules, NYSE Arca
could direct the OTP Firm to suspend or withdraw the person's status as
an Authorized Trader.
    The Sponsoring OTP Firm/Sponsored Participant relationship would
allow a member firm to grant access to NYSE Arca to their customers
while confirming that those customers who do have access to NYSE Arca
have appropriate procedures in place to comply with NYSE Arca rules.
Furthermore, the identity of all individuals with access (i.e.,
Authorized Traders) would have to be disclosed to the Exchange, giving
the Exchange better information in the event that the Exchange
determines to take action because its systems have been used
inappropriately.
    Proposed NYSE Arca Rule 6.32A. Proposed NYSE Arca Rule 6.32A
defines ``Market Maker'' on the OX platform. A Market Maker on OX would
be an OTP Holder or OTP Firm registered with NYSE Arca for the purpose
of submitting quotes electronically and making transactions as a
dealer-specialist through the OX trading platform from on the trading
floor or remotely from off the trading floor. A Market Maker submitting
quotes remotely is not eligible to participate in trades effected in
open outcry except to the extent that such Market Maker's quotation
represents the best bid or offer on the Exchange (``BBO''). Market
Makers would be designated as specialists on NYSE Arca for all purposes
under the Act and the Rules and Regulations thereunder. A Market Maker
on NYSE Arca would be either a Market Maker or an LMM. Unless
specified, or unless the context requires otherwise, the term Market
Maker in the NYSE Arca Rules refers to both Market Makers and LMMs.
    Proposed NYSE Arca Rule 6.32A does not contain the same
restrictions outlined in the current NYSE Arca Rule 6.32. NYSE Arca
proposes to make NYSE Arca Rule 6.32 applicable to classes that would
continue to trade only on PCX Plus because current NYSE Arca Rule 6.32
outlines the different types of market makers presently on the Exchange
and certain restrictions and limitations applicable to such market
makers. Proposed NYSE Arca Rule 6.32A clarifies that there would be
only two types of Market Makers on OX (i.e., LMMs and Market Makers)
and that Market Makers would be permitted to stream quotes from on or
off of the trading floor. Accordingly, proposed NYSE Arca Rule 6.32A
does not direct where Market Makers have to be physically located when
effecting transaction on NYSE Arca and eliminates ``in-person'' trading
requirements applicable to market makers that trade on the floor.
    Proposed NYSE Arca Rule 6.34A. NYSE Arca is proposing NYSE Arca
Rule 6.34A to limit Market Maker access to OX to those OTP Holders or
officers, partners, employees or associated persons of OTP Firms that
are registered with NYSE Arca as Market Makers (``Market Maker
Authorized Traders'' or ``MMATs''). Persons would be required to pass
an NYSE Arca conducted examination to demonstrate their knowledge of
NYSE Arca rules prior to being approved by NYSE Arca as an MMAT. NYSE
Arca also would be permitted to require a Market Maker to provide
additional information NYSE Arca considers necessary to establish
whether a person should be approved as an MMAT. A person would be
permitted to be approved conditionally as an MMAT subject to any
conditions NYSE Arca's Chief Regulatory Officer considers appropriate
in the interests of maintaining a fair and orderly market.
    NYSE Arca Rule 6.34A would permit NYSE Arca to suspend or withdraw
the registration of an MMAT if NYSE Arca determines that: (i) The
person has caused the Market Maker to fail to comply with the Rules of
NYSE Arca; (ii) the person is not properly performing the
responsibilities of an MMAT; (iii) the person has failed to meet the
conditions described above (e.g., failed the Exchange-administered
examination); or (iv) NYSE Arca believes it is in the best interest of
fair and orderly markets. If NYSE Arca suspends the registration of a
person as an MMAT, the Market Maker must not allow the person to submit
quotes and orders on OX. The registration of an MMAT also would be
withdrawn upon the written request of the OTP Firm for which the MMAT
is registered. Such written request must be submitted on the form
prescribed by NYSE Arca.
    Proposed NYSE Arca Rule 6.34A would allow the Exchange to know the
identities of individuals accessing NYSE Arca on behalf of Market
Makers and performing the functions of Market Makers. Proposed NYSE
Arca Rule 6.34A also would allow the Exchange, through the Exchange's
examination process, to confirm that MMATs have sufficient knowledge of
Exchange rules prior to their acting as MMATs on the Exchange.
Furthermore, Proposed NYSE Arca Rule 6.34A would permit the Exchange to
take prompt action against MMATs who are not compliant with Exchange
Rules or who are not properly performing the functions of a Market
Maker thereby limiting any negative consequences of such actions.
    Proposed amendment to NYSE Arca Rule 6.35. NYSE Arca is proposing
changes to the manner in which Market

Maker appointments are made. Consistent with current NYSE Arca Rule
6.35, Market Makers would be required to apply for an appointment in
one or more options classes. NYSE Arca may appoint one LMM per option
class and an unlimited number of Market Makers in each class unless
NYSE Arca determines that the number of Market Makers appointed to a
particular option class should be limited whenever, in NYSE Arca's
judgment, system capacity limits the number of Market Makers who would
be permitted to participate in a particular option class. However, NYSE
Arca would not limit access to Market Makers until such time as it has
submitted to the Commission for its review and approval objective
criteria for limiting access to Market Makers.
    NYSE Arca is proposing to increase the number of classes per OTP
that a Market Maker would be permitted to select for its appointment as
follows: (i) Market Makers with one OTP would have up to 100 option
issues included in their appointment; (ii) Market Makers with two OTPs
would have up to 250 option issues included in their appointment; (iii)
Market Makers with three OTPs would have up to 750 option issues
included in their appointment; and (iv) Market Makers with four OTPs
would have all option issues traded on NYSE Arca included in their
appointment. Market Makers would be permitted to select from among any
option issues traded on NYSE Arca for inclusion in their appointment,
subject to the approval of NYSE Arca.
    NYSE Arca would continue to consider the following factors when
determining whether to approve the appointment of a Market Maker in
each security: (i) The Market Maker's preference; (ii) the financial
resources available to the Market Maker; (iii) the Market Maker's
experience, expertise and past performance in making markets, including
the Market Maker's performance in other securities; (iv) the Market
Maker's operational capability; and (v) the maintenance and enhancement
of competition among Market Makers in each security in which they are
appointed.
    Consistent with current NYSE Arca Rule 6.35, Market Makers would be
permitted to change the option issues that are included in their
appointment, subject to the approval of NYSE Arca and provided that
such request is made in a form and manner prescribed by NYSE Arca. In
considering whether to approve Market Makers' request to change their
appointment, NYSE Arca would consider the five factors set forth
directly above. Market Makers would be permitted to withdraw from
trading an option issue that is within their appointment by providing
NYSE Arca with three business days' written notice of such withdrawal.
Market Makers who fail to give advance written notice of withdrawal to
NYSE Arca may be subject to formal disciplinary action pursuant to NYSE
Arca Rule 10.
    Also consistent with current NYSE Arca Rule 6.35, NYSE Arca would
be permitted to suspend or terminate any appointment of a Market Maker
in one or more option issues under amended NYSE Arca Rule 6.35
whenever, in NYSE Arca's judgment, the interests of a fair and orderly
market are best served by such action. A Market Maker would be able to
seek review of any action taken by NYSE Arca pursuant to the proposed
rule, including the denial of the appointment for, or the termination
or suspension of, a Market Maker's appointment in an option issue or
issues in accordance with NYSE Arca Rule 10.
    Market Makers would continue to be required to trade at least 75%
of their contract volume per quarter in classes within their
appointment. However, NYSE Arca is proposing to exclude from this
calculation trades effected on the Trading Floor to accommodate cross
trades executed pursuant to NYSE Arca Rule 6.47, regardless of whether
the trades are in issues within or without a Market Maker's
appointment.
    NYSE Arca periodically would conduct an evaluation of Market Makers
to determine whether they have fulfilled performance standards relating
to, among other things, quality of markets, competition among Market
Makers, observance of ethical standards and administrative factors. In
so doing, NYSE Arca would be permitted to consider any relevant
information including, but not limited to, the results of a Market
Maker evaluation, trading data, a Market Maker's regulatory history and
such other factors and data as may be pertinent in the circumstances.
If NYSE Arca finds any failure by a Market Maker to meet minimum
performance standards, NYSE Arca would be permitted to take the
following actions after written notice and after opportunity for
hearing pursuant to NYSE Arca Rule 10: (i) Restrict appointments to
additional option issues in the Market Maker's primary appointment;
(ii) suspend, terminate or restrict an appointment in one or more
option issues; or (iii) suspension, termination, or restriction of the
Market Maker's registration in general. If a Market Maker's appointment
in an option issue or issues has been terminated because it failed to
meet minimum performance standards, the Market Maker would not be re-
appointed as a Market Maker in that option issue or issues for a period
not to exceed six months.
    Proposed NYSE Arca Rule 6.37A. NYSE Arca is proposing new NYSE Arca
Rule 6.37A to outline Market Maker obligations (i) Generally, (ii)
within a Market Maker's appointed classes, and (iii) outside of a
Market Maker's appointed classes on OX. Proposed rule 6.37A generally
is consistent with certain existing requirements contained in NYSE Arca
Rule 6.37 (e.g., obligations within and outside of a Market Makers
appointment, establishment of quotation width limitations). However,
because there only would be two types of Market Makers on OX, proposed
NYSE Arca Rule 6.37A eliminates requirements relevant to Remote Market
Makers and Supplemental Market Makers and eliminates in person trading
requirements because Market Makers would be permitted to choose the
physical location from which they would submit quotes to OX.
Furthermore, NYSE Arca is proposing to address Market Maker quoting
obligations separately in proposed NYSE Arca Rule 6.37B.
    Proposed NYSE Arca Rule 6.37B. NYSE Arca is proposing new NYSE Arca
Rule 6.37B to outline Market Maker quoting obligations on OX. Market
Makers would be required to undertake a meaningful obligation to
provide continuous two-sided markets in classes traded on OX. Proposed
rule 6.37B generally is consistent with existing NYSE Arca Rule 6.37.
Under proposed NYSE Arca Rule 6.37B, Market Makers would be permitted
to enter quotations only in the classes included in their appointment.
Proposed NYSE Arca Rule 6.37B also outlines the percentage of time that
Market Makers must quote on the Exchange (i.e., 99% of the time the
Exchange is open for trading for LMMs and 60% of the time the Exchange
is open for trading for Market Makers). Market Makers quotes would be
``firm'' for all orders that are routed to OX (i.e., Market Makers
would not specify different sizes for Customer orders and non-Customer
orders; rather, Market Makers would disseminate one size and would be
``firm'' for any order type routed to the Exchange).
    Proposed NYSE Arca Rule 6.37C. NYSE Arca is proposing new NYSE Arca
Rule 6.37C that would allow Market Makers to enter on OX all permitted
orders types.
    Proposed NYSE Arca Rule 6.40A. NYSE Arca is proposing new NYSE Arca
Rule 6.40A to provide a mechanism for limiting Market Maker

risk during periods of increased and significant trading activity on OX
in a Market Maker's appointment. Unlike current NYSE Arca Rule 6.40,
however, NYSE Arca is proposing to set the ``n'' period at one second.
Pre-setting the ``n'' period at one second would give NYSE Arca greater
control over the functioning of the risk limitation mechanism and would
reduce User confusion regarding how much time must pass before the risk
limitation mechanism activates.
    In the proposed new rule, NYSE Arca also would no longer generate
two-sided quotes on behalf of an LMM in the event that there are no
Market Makers quoting in an issue. Rather, in the event that there are
no Market Makers quoting in the issue, the best bids and offers of
those orders residing in the OX Book in the issue would be disseminated
as the BBO. If there are no Market Makers quoting in the issue and
there are no orders in the OX Book in the issue, OX would disseminate a
bid of zero and an offer of zero in that issue.
    Under current NYSE Arca Rule 6.40, the Exchange would disseminate a
market on behalf of an LMM when there are no Market Makers quoting in a
series and the Market Maker risk limitation mechanism is activated.
This market is an artificial market generated by the Exchange that is
not truly reflective of the LMM's market; however, the market is
subject to firm quote requirements and must be honored by the LMM. NYSE
Arca is proposing NYSE Arca Rule 6.40A to improve upon its current NYSE
Arca Rule 6.40. Specifically, proposed NYSE Arca Rule 6.40A would
disseminate a zero bid and zero offer when there are no Market Makers
quoting in a series and there are no other bids or offers on the
Exchange in the series. The zero bid, zero offer market is a true
reflection of the market at that point in time and limits the risk
exposure of Exchange Market Makers when necessary and appropriate
during times of increased volatility.
    Proposed Amendment to NYSE Arca Rule 6.47. NYSE Arca is proposing
to amend NYSE Arca Rule 6.47 governing crosses effected on the trading
floor. Consistent with the existing version of NYSE Arca Rule 6.47, the
proposed amendment provides for (i) Non-facilitation (``Regular Way'')
crosses, (ii) facilitation crosses and (iii) solicitation crosses. In
all cases, orders must be announced to the trading crowd in open outcry
and all terms of the orders must be disclosed to the trading crowd.
Trading crowd participants would be given a reasonable time to respond
with the prices and sizes at which they would be willing to participate
in the cross. With respect to all crosses, a Trading Official would be
available at each post on the trading floor to assist in the
determination of what is a ``reasonable time'' when necessary. Trading
crowd participants who make bids or offers equal to or better than the
proposed cross price would be permitted to participate in a cross. With
respect to facilitations, floor brokers still would be permitted to
participate in up to 40% of the balance of an order to be facilitated,
once bids or offers in the Book and non-member bids and offers in the
trading crowd at or better than the proposed execution price have been
satisfied. The Exchange believes that proposed allocation of contracts
to non-members ahead of the facilitating member is consistent with
Section 11(a) of the Act.\15\ Section 11(a) of the Act prohibits a
member of a national securities exchange from effecting transactions on
that exchange for its own account, the account of an associated person
or an account over which it or its associated person exercises
discretion (collectively, ``covered accounts'') unless an exception
applies. Section 11(a)(1)(G) of the Act and Rule 11a1-1(T) therunder
provide an exception to the general prohibition in Section 11(a) on an
exchange member effecting transactions for its own account.
Specifically, a member that ``is primarily engaged in the business of
underwriting and distributing securities issued by other persons,
selling securities to customers, and acting as broker, or any one or
more of such activities, and whose gross income normally is derived
principally from such business and related activities'' \16\ and
effects a transaction in compliance with the requirements in Rule 11a1-
1(T)(a) may effect a transaction for its own account.\17\ Among other
things, Rule 11a1-1(T)(a) requires that an exchange member presenting a
bid or offer for its own account or the account of another member must
grant priority to any bid or offer at the same price for the account of
a non-member of the exchange.\18\ Because the proposed amendment would
require the facilitating member to yield priority in the cross
transaction to all non-member bids and offers, the Exchange believes
that the proposed amendment is consistent with the requirements of
Section 11(a) and Rule 11a1-1(T).
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78k(a).
    \16\ 15 U.S.C. 78k(a)(1)(G)(i). Paragraph (b) of Rule 11a1-1(T)
under the Act provides that the requirements of Section
11(a)(1)(G)(i) of the Act apply if during its preceding fiscal year
more than 50% of its gross revenues were derived from one or more of
the sources specified in that section. See 17 CFR 240.11a1-1(T).
    In addition to any revenue that independently meets the
requirements of Section 11(a)(1)(G)(i), revenue derived from any
transaction specified in paragraph (A), (B), or (D) of Section
11(a)(1) of the Act or specified in Rule 11a1-4(T) will be deemed to
be revenue derived from one or more of the sources specified in
Section 11(a)(1)(G)(i). See 17 CFR 240.11a1-4(T).
    \17\ 15 U.S.C. 78k(a)(1)(G)(ii).
    \18\ 17 CFR 240.11a1-1(T)(a)(3).
---------------------------------------------------------------------------

    With respect to crossing solicited orders, NYSE Arca proposes to
impose a notification requirement on floor brokers so that customers
would be aware that a floor broker would be permitted to solicit
liquidity to fill the customer's orders. The floor broker would be
required to deliver to the customer a written notification informing
the customer that its order would be permitted to be executed pursuant
to proposed NYSE Arca Rule 6.47(c). Such written notification would
have to disclose the terms and conditions contained in proposed NYSE
Arca Rule 6.47 and be in a form approved by the Exchange.
    NYSE Arca also proposes to add a new category of cross order, the
Mid-Point Crossing Order. A Floor Broker who holds orders to buy and
sell an option contract(s) at the mid-point between the electronically
disseminated BBO in the subject option series would be permitted to
cross the Mid-Point Crossing Orders. Once the Mid Point Crossing Orders
have been represented in the trading crowd by open outcry, and members
of the trading crowd have been given a reasonable time to respond with
the prices and sizes at which they would be willing to participate in
the execution of the Mid-Point Crossing Orders, the Floor Broker would
be permitted to execute the Mid-Point Crossing Orders in accordance
with the procedures in proposed NYSE Arca Rule 6.47 for Regular Way,
facilitation or solicitation crosses, as applicable.
    If a Market Maker is solicited and agrees to participate in a cross
order, pursuant to NYSE Arca Rule 6.85, the Market Maker would not be
permitted to be present in the trading crowd when such order is
represented and executed.

Proposed NYSE Arca Rule 6.62A

    In addition to certain existing order types (e.g., Limit Orders,
Market Orders), NYSE Arca is proposing to add several new order types
available for entry on OX. These would include the following:
    a. Proposed NYSE Arca Rule 6.62A(c). Inside Limit Order. An
``Inside Limit Order'' is a Limit Order, which, if routed away pursuant
to NYSE Arca Rule 6.76B, would be routed to the

market participant or participants with the best displayed price. Any
unfilled portion of the order would not be routed to the next best
price level until all quotes at the current best bid or offer are
exhausted. If the order is no longer marketable it would be ranked in
the OX Book pursuant to NYSE Arca Rule 6.76A.
    b. Proposed NYSE Arca Rule 6.62A(e). Working Order. Working Orders
consist of several existing order types (i.e., All-or-None Orders, Stop
Order) as well as several new order types (i.e., Reserve Orders, Stock
Contingency Orders). Working orders are maintained in the OX Book
Working Order Process, are not disseminated on OX and are executed in
accordance with NYSE Arca Rule 6.76B. A Working Order is any order that
has a conditional or undisplayed price and/or size designated as a
``Working Order'' by NYSE Arca, including, without limitation:
    (1) Reserve Order. A limit order with a portion of the size
displayed and with a reserve portion of the size (``reserve size'')
that is not displayed on OX.
    (2) All-or-None Order (``AON Order''). A Market or Limit Order that
is to be executed in its entirety or not at all.
    (3) Stop Order. A Stop Order is an order that becomes a Market
Order when the market for a particular option contract reaches a
specified price. A Stop Order to buy becomes a Market Order when the
option contract trades at or above the stop price on OX or another
Market Center or when the OX bid is quoted at or above the stop price.
A Stop Order to sell becomes a Market Order when the option contract
trades at or below the stop price on OX or another Market Center or
when the OX offer is quoted at or below the stop price. Stop Orders
(including Stop Limit Orders) would not have standing in any order
process in the OX Book and would not be permitted to be displayed.
    (4) Stop Limit Order. A Stop Limit Order is an order that becomes a
Limit Order when the market for a particular option contract reaches a
specified price. A Stop Limit Order to buy becomes a Limit Order when
the option contract trades at or above the stop price on OX or another
Market Center or when the OX bid is quoted at or above the stop price.
A Stop Limit Order to sell becomes a Limit Order when the option
contract trades at or below the stop price on OX or another Market
Center or when the OX offer is quoted at or below the stop price.
    (5) Stock Contingency Order. A Stock Contingency Order is an option
order the execution of which is contingent upon the last sale price as
specified by the User of the underlying stock traded at the primary
marketplace.
    c. Proposed NYSE Arca Rule 6.62A(i). NOW Order. A ``NOW Order'' is
a Limit Order that is to be executed in whole or in part on OX, and the
portion not so executed would be routed pursuant to NYSE Arca Rule
6.76B only to one or more NOW Recipients for immediate execution as
soon as the order is received by the NOW Recipient. Any portion not
immediately executed by the NOW Recipient would be cancelled. If a NOW
Order is not marketable when it is submitted to OX, it would be
cancelled. As described above, NOW Recipients are those Market Centers
that are automated and do not allow for manual intervention with
respect to orders.
    d. Proposed NYSE Arca Rule 6.62A(j). PNP Order. A ``PNP Order''
(Post No Preference) is a Limit Order to buy or sell that is to be
executed in whole or in part on NYSE Arca, and the portion not so
executed is to be ranked in the OX Book, without routing any portion of
the order to another Market Center; provided, however, NYSE Arca would
be required to cancel a PNP Order that would lock or cross the NBBO.
    e. NYSE Arca Rule 6.62A(k). Mid-Point Crossing Order. A ``Mid-Point
Crossing Order'' is an order to be crossed at the mid-point price or
better of the electronically disseminated BBO \19\ in the relevant
option series pursuant to NYSE Arca Rule 6.47; provided, however, that
the mid-point must fall on a minimum price variation (``MPV'').\20\ If
the mid-point does not fall on an MPV, the Mid-Point Crossing Order
would be cancelled.
---------------------------------------------------------------------------

    \19\ See proposed NYSE Arca Rule 6.1A(a)(2).
    \20\ See proposed NYSE Arca Rule 6.1A(a)(10).
---------------------------------------------------------------------------

    The order types in Proposed NYSE Arca Rule 6.62A would provide
greater flexibility to customers to control their orders. By offering
order types such as the Reserve Order, customers would be able to
determine how much of their order they want disseminated at any point
in time and eliminates the need for customers to enter multiple orders
in one series. Furthermore, NOW Orders and PNP Orders provide customers
with flexibility with respect to where their orders would (or would
not) be routed once they have been processed on the Exchange.

Proposed NYSE Arca Rule 6.64A

    NYSE Arca is proposing new NYSE Arca Rule 6.64A to govern the
opening process, which traditionally has been referred to as a
``rotation,'' and which would be referred to as an ``auction'' on the
OX platform. A ``Trading Auction'' is a process by which trading is
initiated in a specified options class. Trading Auctions may be
employed at the opening of NYSE Arca each business day or to re-open
trading after a trading halt. Trading Auctions would be conducted
automatically by the OX trading platform.
    The OX system would accept Market and Limit Orders and quotes for
inclusion in the opening auction process (``Auction Process'') until
the Auction Process is initiated in that option series. Prior to the
Auction Process (``pre-opening''), non-Market Makers would be able to
submit orders to OX and Market Makers would be able to submit two-sided
quotes and orders to OX. Contingency orders (except for ``opening
only'' orders) would not participate in the Auction Process. Any
eligible open orders residing in the OX Book from the previous trading
session would be included in the Auction Process. After the primary
market for the underlying security disseminates the opening trade or
the opening quote, the related option series would be opened
automatically based on the following principles and procedures:
    a. The OX system would determine a single price at which a
particular option series would be opened.
    b. Orders would have priority over Market Maker quotes. Orders and
quotes in the OX system would be matched up with one another based on
price-time priority.
    c. Orders in the OX Book that were not executed during the Auction
Process would become eligible for the Core Trading Session immediately
after the conclusion of the Auction Process.
    To determine the opening price in a series, upon receipt of the
first consolidated quote or trade of the underlying security, OX would
compare the Options Price Reporting Authority (``OPRA'') NBBO market
with the initial BBO market. OX would generate an opening trade if
possible or open a series on the quoted market. OX then would send the
OX BBO quote to OPRA.
    The opening price of a series would be the price, as determined by
the OX system, at which the greatest number of contracts would trade at
or nearest to the midpoint of the initial NBBO disseminated by OPRA, if
any, or the midpoint of the best quote bids and quote offers in the OX
Book. Midpoint pricing would not occur if that price would result in an
order or part of an order being traded through. Instead the Trading
Auction would occur at that limit price, or, if the limit price is
superior to the quoted market, within the range of 75% of the best
quote bid and 125% of the best quote offer. The

same process would be followed to reopen an option class after a
trading halt.
    Unmatched orders and Marker Maker quotes that are marketable
against the initial NBBO would ``sweep'' through the OX Book and be
executed in price/time priority. If the best price is at an away Market
Center(s), orders would be routed away to the relevant Market
Center(s).
    Proposed NYSE Arca Rule 6.64A would allow the maximum number of
contracts to be executed on the opening while giving orders priority
over Market Maker quotes on the open.

Proposed NYSE Arca Rule 6.76A

    NYSE Arca would display all non-marketable Limit Orders in the
Display Order Process of the OX Book. Except as otherwise permitted by
NYSE Arca Rule 6.76A, all bids and offers at all price levels in the OX
Book would be displayed on an anonymous basis. OX also would
disseminate current consolidated quotations/last sale information, and
such other market information as may be made available from time to
time pursuant to agreement between NYSE Arca and other Market Centers,
consistent with the Plan for Reporting of Consolidated Options Last
Sale Reports and Quotation Information.
    Bids and offers would be ranked and maintained in the Display Order
Process and/or Working Order Process of the OX Book according to price-
time priority.
 a. Within the Display Order Process
    Limit Orders, with no other conditions, and quotes would be ranked
based on the specified price and the time of original order or quote
entry. The displayed portion of Reserve Orders (not the reserve size)
would be ranked in the Display Order Process at the specified limit
price and the time of order entry. When the displayed portion of the
Reserve Order is decremented completely, the displayed portion of the
Reserve Order would be refreshed for:
    (1) The displayed amount; or
    (2) the entire reserve amount, if the remaining reserve amount is
smaller than the displayed amount, from the reserve portion and would
be submitted and ranked at the specified limit price and the new time
that the displayed portion of the order was refreshed.
b. Within the Working Order Process
    (1) The reserve portion of Reserve Orders would be ranked based on
the specified limit price and the time of original order entry. After
the displayed portion of a Reserve Order is refreshed from the reserve
portion, the reserve portion would remain ranked based on the original
time of order entry, while the displayed portion would be sent to the
Display Order Process with a new time-stamp.
    (2) All-or-None Orders would be ranked based on the specified limit
price and the time of order entry.
    (3) Stop and Stop Limit Orders would be ranked based on the
specified stop price and the time of order entry.
    (4) Stock Contingency Orders would be ranked based on the specified
limit price and the time of order entry.
    Consistent with Rule 602 under Regulation NMS,\21\ the best-ranked
displayed bids and offers to buy and the best ranked displayed bids and
offers to sell in the OX Book and the aggregate displayed size of such
bids and offers associated with such prices would be collected and made
available to quotation vendors for dissemination.
---------------------------------------------------------------------------

    \21\ 17 CFR 242.602.
---------------------------------------------------------------------------

    The Display Order Process of the OX Book in proposed NYSE Arca Rule
6.76A provides the ``traditional'' book found on most options exchange.
The Working Order Process, a new concept with respect to options
exchanges, provides a method for booking contingency order as well as
other new order types such as Reserve Orders. The Working Order Process
provides greater flexibility to customers because of the different
order types that would be permitted to be placed in the Working Order
Process for future execution.

Proposed NYSE Arca Rule 6.76B

    Proposed NYSE Arca Rule 6.76B outlines the applicable requirements
for order execution and priority on the OX trading platform. Unless an
LMM is entitled to a guaranteed participation because he is quoting at
the NBBO, all orders would be matched based on strict price-time
priority. For an execution to occur in any order process, the price
must be equal to or better than the NBBO, unless OX has routed orders
to away Market Centers at the NBBO.
    a. Proposed NYSE Arca Rule 6.76B is Consistent with Section 11(a)
of the Act.
    The Exchange believes that the proposed allocation of orders based
on strict price-time priority for orders executed via OX is consistent
with Section 11(a) of the Act. As described earlier herein, Section
11(a) of the Act prohibits a member of a national securities exchange
from effecting transactions on that exchange for its own account, the
account of an associated person, or an account over which it or its
associated person exercises discretion (collectively, ``covered
accounts'') unless an exception applies. First enacted as part of the
Securities Acts Amendments of 1975,\22\ Section 11(a) was intended by
Congress to address trading advantages enjoyed by exchange members and
conflicts of interest in money management.\23\ In particular, as noted
by the Commission, Congress was concerned about members benefiting in
their principal transactions from special ``time and place'' advantages
associated with floor trading--such as the ability to ``execute
decisions faster than public investors.'' \24\
---------------------------------------------------------------------------

    \22\ See Pub. L. No. 94-29, 89 Stat. 110 (June 4, 1975).
    \23\  See Securities Reform Act of 1975, Report of the House
Comm. on Interstate and Foreign Commerce, H.R. Rep. No. 94-123, 94th
Cong., 1st Sess. (1975) (``House Report''); Securities Acts
Amendments of 1975, Report of the Senate Comm. on Banking, Housing
and Urban Affairs, S. Rep. No. 94-75, 94th Cong., 1st Sess. (1975).
    \24\ See Securities Exchange Act Release No. 14563 (Mar. 14,
1978), 43 FR 11542, at 11543 (Mar. 17, 1978); Securities Exchange
Act Release No. 14713 (Apr. 27, 1978), 43 FR 18557, at 18588 (May 1,
1978) (``1978 Release II''); Securities Exchange Act Release No.
15533 (Jan. 29, 1979), 44 FR 6084, at 6092 (Jan. 31, 1979) (``1979
Release''). The 1978 and 1979 Releases cite the House Report at 54-
57.
---------------------------------------------------------------------------

    Where principal transactions contribute to the fairness and
orderliness of exchange markets or do not reflect any time and place
trading advantages, they are excepted from the prohibition. Among the
transactions excepted under Section 11(a)(1) are those by a dealer
acting in the capacity of a market maker,\25\ bona fide arbitrage or
hedge transactions,\26\ and transactions made to offset errors.\27\
Rule 11a2-2(T) under the Exchange Act provides an exception in addition
to those delineated in the statute.\28\
---------------------------------------------------------------------------

    \25\ See Section 11(a)(1)(A), 15 U.S.C. 78k(a)(1)(A). In
addition to the application of Rule 11a2-2(T), members of the
Exchange who are registered as market makers may also take advantage
of the market maker exemption from Section 11(a), at least for
securities in which they make a market.
    \26\ See Section 11(a)(1)(D) of the Act. 15 U.S.C. 78k(a)(1)(D).
    \27\ See Section 11(a)(1)(F) of the Act. 15 U.S.C. 78k(a)(1)(F).
    \28\ 17 CFR 240.11a2-2(T).
---------------------------------------------------------------------------

    Commonly referred to as the ``effect versus execute'' rule, Rule
11a2-2(T) permits an exchange member, subject to certain conditions, to
effect transactions for covered accounts by arranging for an
unaffiliated member to execute the transactions directly on the
exchange floor. To comply with the rule's conditions, a member (1) Must
transmit the order from off the exchange floor; (2) may not participate
in the execution of the transaction once it has been transmitted to the
member performing the execution; \29\ (3) may not be affiliated with
the executing member; and (4) with respect to an account over

which the member or an associated person has investment discretion,
neither the member nor the associated person may retain any
compensation in connection with effecting the transaction without
express written consent from the person authorized to transact business
for the account in accordance with the rule.
---------------------------------------------------------------------------

    \29\ The member may participate, however, in clearing and
settling the transaction.
---------------------------------------------------------------------------

    As described by the Commission, these four requirements--off-floor
transmission, non-participation in order execution, execution through
an unaffiliated member and non-retention of compensation for
discretionary accounts--were ``designed to put members and non-members
on the same footing, to the extent practicable, in light of the
purposes of Section 11(a).'' \30\ If a transaction meets the
requirements of the ``effect versus execute'' rule, it would be deemed
to be ``consistent with the purpose of Section 11(a)(1) of the Act, the
protection of investors, and the maintenance of fair and orderly
markets.'' \31\
---------------------------------------------------------------------------

    \30\ See 1978 Release II at 18560.
    \31\ See Rule 11a2-2(T)(e) under the Act. 17 CFR 240.11a2-
2(T)(e).
---------------------------------------------------------------------------

    OX represents a new electronic trading platform that may be
utilized by Exchange members and their customers to effect the purchase
and sale of securities. OX would place all of its Users--both members
and non-members of the Exchange--on the ``same footing,'' as intended
by Rule 11a2-2(T). Given OX's automated matching and execution
services, no Exchange member would enjoy any special control over the
timing of execution or special order handling advantages for orders
executed via OX, as all orders would be centrally processed for
execution by computer, rather than being handled by a member through
bids or offers made on the trading floor. Because OX's open, electronic
structure is designed to prevent any Exchange members from gaining any
time and place advantages, the Exchange believes that OX satisfies the
four requirements of the ``effect versus execute'' rule as well as the
general policy objectives of Section 11(a).
    Rule 11a2-2(T) requires the orders for a covered account
transaction to be transmitted from off the exchange floor. In
considering the application of this requirement to a number of
automated trading and electronic order-handling facilities operated by
national securities exchanges, the Commission has deemed the off-floor
requirement to be met if the order is transmitted from off the floor
directly to the exchange floor by electronic means.\32\ Like these
other automated systems, orders sent to OX would be transmitted from
remote terminals directly to the system by electronic means. Therefore,
the Exchange believes that Users' orders electronically received by OX
satisfy the off-floor transmission requirement for the purposes of the
``effect versus execute'' rule.
---------------------------------------------------------------------------

    \32\ Among the systems considered by the Commission are (1) The
Philadelphia Stock Exchange's (``Phlx'') VWAP Trading System; (2)
the Pacific Exchange's (``PCX'') Application of OptiMark; (3)
Chicago Match; (4) the American Stock Exchange's Post Execution
Reporting System and the Amex Switching System (see 1979 Release at
n. 25); (5) the Intermarket Trading System; (6) the Multiple Dealer
Trading Facility of the Cincinnati Stock Exchange; (7) the PCX's
Communications and Execution System (``COMEX''); and (8) the Phlx's
Automated Communications and Execution System (``PACE'') (see 1979
Release at nn. 19-35).
---------------------------------------------------------------------------

    The ``effect versus execute'' rule further provides that the
exchange member and its associated person may not participate in the
execution of the transaction once the order has been transmitted. The
Exchange believes that orders submitted to OX meet the non-
participation requirement. Upon submission to OX, an order would enter
the queue and be executed against another order in the OX Book based on
an established matching algorithm. The execution depends not on the
Exchange member, but rather, upon what other orders are entered into OX
at or around the same time as the subject order, what orders are
resident in the OX Book and where the order is ranked based on the
price-time priority ranking algorithm. Therefore, at no time following
the submission of an order is an Exchange member able to acquire
control or influence over the result or timing of orders generated.
That is, unlike a floor broker who currently enjoys a trading advantage
inherent to being present on an exchange floor for transactions being
executed on that floor, no OTP Holder or OTP Firm would be permitted to
take advantage of any non-member User through the use of OX. As a
result, the Exchange believes the non-participation requirement is met
where OTP Holder or OTP Firm orders are matched and executed
automatically in OX.
    Although Rule 11a2-2(T) contemplates having an order executed by an
exchange member who is unaffiliated with the member initiating the
order, the Commission has recognized in the past that this requirement
is not applicable where automated exchange facilities are used. For
example, in considering the operation of COMEX and PACE, among other
systems, the Commission noted that while there is no independent
executing exchange member, the execution of an order is automatic once
it has been transmitted into the systems.\33\ Because the design of
these systems ensures that members do not possess any special or unique
trading advantages in handling their orders after transmitting them to
the exchange floors, the Commission has stated that executions obtained
through these systems satisfy the independent execution requirement of
Rule 11a2-2(T).\34\ The Exchange believes that this principle is
directly applicable to OX; the design of OX ensures that OTP Holders
and OTP Firms do not have any special or unique trading advantages in
handling their orders after transmission. Accordingly, the Exchange
believes that an OTP Holder or OTP Firm effecting a transaction by
utilizing OX satisfies the requirement for execution through an
unaffiliated member.
---------------------------------------------------------------------------

    \33\ See 1979 Release.
    \34\ Id.
---------------------------------------------------------------------------

    Finally, the exemption in Rule 11a2-2(T) states that, in the case
of a transaction effected for an account for which the initiating
member exercises investment discretion, in general, the member may not
retain compensation for effecting the transaction. As a prerequisite to
the use of OX, if an Exchange member is to rely on Rule 11a2-2(T) for a
managed account transaction, the Exchange member must comply with the
limitations on compensation as set forth in paragraph (a)(2)(iv) of the
``effect versus execute'' rule.
b. Execution of Orders on OX
    OX first would attempt to match incoming marketable bids and offers
against bids or offers in the Display Order Process at the display
price of the resident bids or offers for the total amount of option
contracts available at that price or for the size of the incoming
order, whichever is smaller. For the purposes of proposed NYSE Arca
Rule 6.76B(a), the size of an incoming Reserve Order would include the
displayed and reserve size, and the size of the portion of the Reserve
Order resident in the Display Order Process is equal to its displayed
size. NYSE Arca proposes to allocate incoming marketable bids and
offers as follows:
c. The Display Order Process
    (1) If there is an LMM quoting in the option series, an incoming
marketable bid or offer would be matched against all Customer orders
ranked ahead of the LMM, provided that such execution(s) must occur at
a price equal to or better than the NBBO. The remaining balance

of the incoming marketable bid or offer would be matched against the
quote of the LMM for either: (i) an amount equal to 40% of the
remaining balance of the incoming bid or offer up to the LMM's
disseminated quote size; or (ii) the LMM's share in the order of
ranking in the OX Book, whichever is greater. Any remaining balance of
the incoming marketable bid or offer would be matched against remaining
orders and quotes in the Display Order Process in the order of their
ranking.
    (2) If there is no LMM quoting in the option series, the incoming
marketable bid or offer would be matched against orders and quotes in
the Display Order Process based upon their rankings.
    (3) If the incoming marketable bid or offer has not been executed
in its entirety, the remaining part of the order would be routed to the
Working Order Process.
d. The Working Order Process
    An incoming bid or offer that is not marketable against the Display
Order Process would be sent to the Working Order Process to be executed
against any Working Orders at or better than the NBBO. An incoming
marketable bid or offer would be matched for execution against orders
in the Working Order Process in the following manner:
    (1) An incoming marketable bid or offer would be matched against
orders within the Working Order Process in the order of their ranking,
at the price of the displayed portion (for Reserve Orders) or at the
limit price (for all other Working Order types), for the total amount
of option contracts available at that price or for the size of the
incoming bid or offer, whichever is smaller.
    (2) If an incoming marketable order has not been executed in its
entirety on OX and it has been designated as an order type that is
eligible to be routed away, the order would be routed for execution to
another Market Center(s). If an order has been designated as an order
type that is not eligible to be routed away, the order either would be
placed in the OX Book or cancelled if such order would lock or cross
the NBBO.
e. Routing Away
    (1) The order would be routed, either in its entirety or as
component orders, to another Market Center(s) as a Limit Order equal to
the price and up to the size of the quote published by the Market
Center(s). The remaining portion of the order, if any, would be ranked
and displayed in the OX Book in accordance with the terms of such order
pursuant to NYSE Arca Rule 6.76A and such order would be eligible for
execution pursuant to NYSE Arca Rule 6.76B.
    (2) A marketable Reserve Order would be permitted to be routed
serially as component orders, such that each component corresponds to
the displayed size.
    An order that has been routed away (either via Linkage or the OX
Routing Broker) would remain outside of OX for a prescribed period of
time (i.e., based on current required response times for Linkage
orders, the prescribed period of time would be no more than 20 seconds;
NYSE Arca would use the same time standard for orders routed via the OX
Routing Broker) and would be permitted to be executed in whole or in
part subject to the applicable trading rules of the relevant Market
Center. While an order remains outside of OX, it would have no time
standing, relative to other orders received from Users at the same
price that would be permitted to be executed against the OX Book.
    Requests from Users to cancel their orders while the orders are
routed away to another Market Center and remain outside OX would be
processed subject to the applicable trading rules of the relevant
Market Center and relevant Linkage Plan rules.
    Where an order or portion of an order is routed away and is not
executed either in whole or in part at the other Market Center (i.e.,
all attempts at the fill are declined or timed-out), the order would be
ranked and displayed in the OX Book in accordance with the terms of
such order under proposed NYSE Arca Rule 6.76A and such order would be
eligible for execution under proposed NYSE Arca Rule 6.76B.
    Proposed Amendments to NYSE Arca Rules 6.32, 6.37, 6.40, 6.47,
6.62, 6.64, 6.75, 6.76 and 6.82. NYSE Arca is proposing to amend NYSE
Arca Rules 6.32, 6.37, 6.40, 6.47, 6.62, 6.64, 6.75, 6.76 and 6.82 to
indicate that they only apply to transactions executed on PCX Plus, or,
in the case of NYSE Arca Rule 6.75, in open outcry.
2. Statutory Basis
    The proposed rule change, as amended, is consistent with Section
6(b) of the Act,\35\ in general, and furthers the objectives of Section
6(b)(5) \36\ in particular in that it is 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, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system.
---------------------------------------------------------------------------

    \35\ 15 U.S.C. 78f(b).
    \36\ 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, as
amended, will impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    Written comments on the proposed rule change were neither solicited
nor received.

III. 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 rule change, as amended, or
    (B) institute proceedings to determine whether the proposed rule
change, as amended, 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<EMAIL_ADDRESS>Please include

File No. SR-NYSEArca-2006-13 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, D.C. 20549-1090.

All submissions should refer to File No. SR-NYSEArca-2006-13. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's

Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the

submission, all subsequent amendments, all written statements with
respect to the proposed rule change that are filed with the Commission,
and all written communications relating to the proposed rule change
between the Commission and any person, other than those that may be
withheld from the public in accordance with the provisions of 5 U.S.C.
552, will be available for inspection and copying in the Commission's
Public Reference Room. Copies of such filing will also be available for
inspection and copying at the principal office of NYSE Arca. 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-NYSEArca-2006-13 and should be
submitted July 14, 2006.

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\37\
---------------------------------------------------------------------------

    \37\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Nancy M. Morris,
Secretary.
 [FR Doc. E6-9930 Filed 6-22-06; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register Volume 81, Number 26 (Tuesday, February 9, 2016)]
[Notices]
[Page 6869]
[FR Doc No: 2016-02545]

-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2013-N-1504]

Independent Assessment of the Process for the Review of Device
Submissions; Implementation Evaluation Report

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA or Agency) is announcing
Booz Allen Hamilton's final evaluation report submitted as part of
their independent assessment of the process for the review of medical
device submissions. The evaluation is part of the FDA performance
commitments relating to the Medical Device User Fee Amendments of 2012
(MDUFA III), which reauthorized device user fees for fiscal years 2013
through 2017. The assessment is described in section V, Independent
Assessment of Review Process Management, of the commitment letter
entitled ``MDUFA Performance Goals and Procedures'' (MDUFA III
Commitment Letter). The evaluation has been conducted as the second
phase (Phase 2) and is the last of a series of deliverables, as
outlined in the contract statement of work.

FOR FURTHER INFORMATION CONTACT: Raphaela Simon, Office of Planning,
Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 32, Rm.
3379, Silver Spring, MD 20993-0002,<PHONE_NUMBER>,
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background

    On July 9, 2012, President Obama signed into law the Food and Drug
Administration Safety and Innovation Act (Pub. L. 112-144) (FDASIA).\1\
Title II of FDASIA is the Medical Device User Fee Amendments of 2012
(MDUFA III), which gives FDA the authority to collect device user fees
from industry for fiscal years 2013 through 2017. MDUFA III took effect
on October 1, 2012, and will continue through September 30, 2017.
---------------------------------------------------------------------------

    \1\ https://www.gpo.gov/fdsys/pkg/PLAW-112publ144/pdf/PLAW-112publ144.pdf.
---------------------------------------------------------------------------

    Device user fees were first established by Congress in 2002.
Medical device companies pay fees to FDA when they register their
establishment and list their devices with the Agency, whenever they
submit an application or a notification to market a new medical device
in the United States, and for certain other types of submissions. Under
MDUFA III, FDA is authorized to collect user fees that will total
approximately $595 million (plus adjustments for inflation) over 5
years. With this additional funding, FDA will be able to hire more than
200 full-time-equivalent workers over the course of MDUFA III. In
exchange, FDA has committed to meet certain performance goals outlined
in the MDUFA III Commitment Letter.\2\
---------------------------------------------------------------------------

    \2\ www.fda.gov/downloads/MedicalDevices/NewsEvents/WorkshopsConferences/UCM295454.pdf.
---------------------------------------------------------------------------

II. Assessment of FDA's Process for the Review of Device Submissions

    Section V of the MDUFA III Commitment Letter states that FDA and
the device industry will participate in a comprehensive assessment of
the process for the review of device applications. The assessment will
include consultation with both FDA and industry. The assessment will be
conducted in two phases by a private, independent consulting firm,
under contract with FDA, that is capable of performing the technical
analysis, management assessment, and program evaluation tasks required
to address the assessment as described in the MDUFA III Commitment
Letter.
    FDA awarded the contract in June 2013 to the consulting firm Booz
Allen Hamilton. Findings on high-priority recommendations (i.e., those
likely to have a significant impact on review times) were published in
December 2013.\3\ Final comprehensive findings and recommendations were
scheduled to be published within 1 year of the contract award and are
included in the report available at www.fda.gov/downloads/ForIndustry/UserFees/MedicalDeviceUserFee/UCM426392.pdf. FDA agreed to publish an
implementation plan within 1 year of the final findings and
recommendations. The final implementation plan, ``Plan of Action,'' was
published December 2014 and is available at www.fda.gov/downloads/ForIndustry/UserFees/MedicalDeviceUserFee/UCM426392.pdf. Examination of
the final comprehensive findings and recommendations report led FDA to
conclude that the recommendations could be expanded to further enhance
the efficiency of premarket reviews. Those actions were also outlined
in the Plan of Action. To distinguish actions in direct response to the
recommendations from additional actions to further improve the
premarket review process, FDA used a ``Stage'' approach. In the Plan of
Action ``Stage 1'' actions directly addressed the recommendations in
the independent assessment and ``Stage 2'' actions outlined additional
long-term actions the Agency intended to implement to further enhance
the premarket review process. In addition, FDA has publicly stated in
the ``Plan of Action'' that the Agency intended to complete all Stage 1
actions by December 31, 2015.
---------------------------------------------------------------------------

    \3\ www.fda.gov/downloads/MedicalDevices/DeviceRegulationandGuidance/Overview/MDUFAIII/UCM378202.pdf.
---------------------------------------------------------------------------

    For Phase 2 of the independent assessment, the contractor evaluated
the implementation of recommendations, described under Stage 1 in the
``Plan of Action,'' and is publishing its written assessment \4\ no
later than February 1, 2016.
---------------------------------------------------------------------------

    \4\ http://www.fda.gov/downloads/ForIndustry/UserFees/MedicalDeviceUserFee/UCM484146.pdf.
---------------------------------------------------------------------------

    FDA has implemented all Stage 1 actions outlined in the Plan of
Action, and incorporated the resulting enhancements into the management
of the premarket review program. Resources permitting, the Center for
Devices and Radiological Health will continue to implement Stage 2
actions. FDA will monitor implemented improvements for accomplishment
of intended results and the process for the review of device
submissions for additional improvement opportunities.

    Dated: February 4, 2016.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2016-02545 Filed 2-8-16; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register: August 15, 2007 (Volume 72, Number 157)]
[Notices]
[Page 45848]
[DOCID:fr15au07-127]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56225; File No. SR-ISE-2007-32]

Self-Regulatory Organizations; International Securities Exchange,
LLC; Order Approving Proposed Rule Change as Modified by Amendment No.
1 Thereto To Remove Certain Rules From Its Rulebook

 August 8, 2007.
    On May 9, 2007, the International Securities Exchange, LLC (the
``Exchange'' or the ``ISE''), filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to remove certain ISE rules. On
June 8, 2007, ISE filed Amendment No. 1 to the proposed rule change.
The proposed rule change was published for comment in the Federal
Register on June 27, 2007.\3\ The Commission received no comments on
the proposal.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 55936 (June 21,
2007), 72 FR 35276 (``Notice'').
---------------------------------------------------------------------------

    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 registered securities exchange.\4\ In
particular, the Commission finds that the proposed rule change is
consistent with Section 6(b)(5) of the Act,\5\ which requires, among
other things, that the Exchange's rules be designed to promote just and
equitable principles of trade, 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.
---------------------------------------------------------------------------

    \4\ In approving this proposal, the Commission considered the
proposed rule's impact on efficiency, competition and capital
formation. 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The ISE proposes to remove Rule 403 (Nominal Employment), Rule 605
(Other Affiliations of Registered Persons), and Rule 615 (Addressing of
Communications to Customers). The Exchange believes that the concern
addressed by Rule 403, which prohibits members from obtaining business
by employing a person in a nominal position, is adequately addressed in
existing Rule 406, which limits gratuities.\6\ The Exchange also
believes that Rule 605, which effectively prohibits registered persons
of its members from engaging in outside business activities unless
approved by the Exchange or the member's designated examining
authority, is no longer necessary given significant market structure
changes.\7\ Lastly, the Exchange believes that Rule 615 is unnecessary
as ISE members are also subject to ISE Rules 600 and 2114, which
effectively require ISE members that do a public business to be
registered with FINRA, and the Exchange believes that the FINRA rules
pertaining to the customer communication policies for its members
conducting a public business should sufficiently address the topic
covered by Rule 615. The Commission therefore believes it is consistent
with the Act for the Exchange to delete these rules.
---------------------------------------------------------------------------

    \6\ Rule 406 prohibits a member from giving any compensation or
gratuity in any one year in excess of $50.00 to any employee of the
Exchange or in excess of $100.00 to any employee of any other member
or of any non-member broker, dealer, bank or institution, without
the prior consent of the employer and of the Exchange.
    \7\ The Exchange also notes that rules of the Financial Industry
Regulatory Authority Inc. (``FINRA'')(f/k/a the National Association
of Securities Dealers, Inc.) governing its members' dealing with the
public do not have a comparable provision.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\8\ that the proposed rule change (File No. SR-ISE-2007-32), as
modified by Amendment No. 1, be, and hereby is, approved.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-15902 Filed 8-14-07; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register Volume 87, Number 116 (Thursday, June 16, 2022)]
[Notices]
[Pages 36323-36324]
[FR Doc No: 2022-12996]

-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 485-076]

Georgia Power Company; Notice of Application Accepted for Filing
and Soliciting Comments, Motions To Intervene, and Protests

    Take notice that the following hydroelectric application has been
filed

with the Commission and is available for public inspection:
    a. Application Type: Non-Capacity Amendment of License.
    b. Project No: 485-076.
    c. Date Filed: May 6, 2022, and supplemented on May 23, 2022.
    d. Applicant: Georgia Power Company.
    e. Name of Project: Bartletts Ferry Hydroelectric Project.
    f. Location: Chattahoochee River, in Harris County, Georgia, and
Lee and Chambers counties, Alabama.
    g. Filed Pursuant to: Federal Power Act, 16 U.S.C. 791a-825r.
    h. Applicant Contact: Courtenay O'Mara, Hydro Licensing &
Compliance Supervisor, 241 Ralph McGill Boulevard NE, BIN 10193,
Atlanta, Georgia 30308-3374,<PHONE_NUMBER>, [email protected].
    i. FERC Contact: Aneela Mousam,<PHONE_NUMBER>,
[email protected].
    j. Deadline for filing comments, motions to intervene, and
protests: July 11, 2022.
    The Commission strongly encourages electronic filing. Please file
comments, motions to intervene, and protests using the Commission's
eFiling system at http://www.ferc.gov/docs-filing/efiling.asp.
Commenters can submit brief comments up to 6,000 characters, without
prior registration, using the eComment system at http://www.ferc.gov/docs-filing/ecomment.asp. You must include your name and contact
information at the end of your comments. For assistance, please contact
FERC Online Support at [email protected],<PHONE_NUMBER> (toll
free), or<PHONE_NUMBER> (TTY). In lieu of electronic filing, you may
submit a paper copy. Submissions sent via the U.S. Postal Service must
be addressed to: Kimberly D. Bose, Secretary, Federal Energy Regulatory
Commission, 888 First Street NE, Room 1A, Washington, DC 20426.
Submissions sent via any other carrier must be addressed to: Kimberly
D. Bose, Secretary, Federal Energy Regulatory Commission, 12225 Wilkins
Avenue, Rockville, Maryland 20852. The first page of any filing should
include the docket number P-485-076. Comments emailed to Commission
staff are not considered part of the Commission record.
    The Commission's Rules of Practice and Procedure require all
intervenors filing documents with the Commission to serve a copy of
that document on each person whose name appears on the official service
list for the project. Further, if an intervenor files comments or
documents with the Commission relating to the merits of an issue that
may affect the responsibilities of a particular resource agency, they
must also serve a copy of the document on that resource agency.
    k. Description of Request: Georgia Power Company (licensee)
requests Commission approval to upgrade four generating units in the
west Bartletts Ferry powerhouse. The licensee proposes to replace
existing turbine runners, rehabilitate generators, and install new
trashracks. The unit modifications would increase the installed
capacity by 13.65 megawatts and increase the maximum hydraulic capacity
by 5 cubic feet per second. To facilitate the proposed unit upgrades,
the licensee may implement a reservoir drawdown. As required by license
Article 401 Project Operation and Lake Levels, if a drawdown is needed
for the proposed work, the licensee would consult with the Georgia
Department of Natural Resources, the Alabama Department of Conservation
and Natural Resources, and U.S. Fish and Wildlife Service Alabama
Ecological Office. The licensee would also, notify the Alabama
Department of Environmental Management and provide boat ramp
elevations.
    The proposed upgrades also include installing aerating turbine
runners in three of the four turbine units (units 1, 2 and 4). The
aerating turbine runners will enhance the project's ability to continue
to achieve Georgia water quality standards by increasing the dissolved
oxygen. Therefore, the licensee also requests to amend Article 403
Tailrace Water Quality Enhancement and Article 404 Tailrace Water
Quality Monitoring of the project license to implement the proposed
Dissolved Oxygen and Water Temperature Monitoring Plan following the
unit upgrades.
    l. Locations of the Application: This filing may be viewed on the
Commission's website at http://www.ferc.gov using the ``eLibrary''
link. Enter the docket number excluding the last three digits in the
docket number field to access the document. You may also register
online at http://www.ferc.gov/docs-filing/esubscription.asp to be
notified via email of new filings and issuances related to this or
other pending projects. For assistance, call 1-866-208-3676 or email
[email protected], for TTY, call<PHONE_NUMBER>. Agencies may
obtain copies of the application directly from the applicant.
    m. Individuals desiring to be included on the Commission's mailing
list should so indicate by writing to the Secretary of the Commission.
    n. Comments, Protests, or Motions to Intervene: Anyone may submit
comments, a protest, or a motion to intervene in accordance with the
requirements of Rules of Practice and Procedure, 18 CFR 385.210, .211,
.214, respectively. In determining the appropriate action to take, the
Commission will consider all protests or other comments filed, but only
those who file a motion to intervene in accordance with the
Commission's Rules may become a party to the proceeding. Any comments,
protests, or motions to intervene must be received on or before the
specified comment date for the particular application.
    o. Filing and Service of Documents: Any filing must (1) bear in all
capital letters the title ``COMMENTS'', ``PROTEST'', or ``MOTION TO
INTERVENE'' as applicable; (2) set forth in the heading the name of the
applicant and the project number of the application to which the filing
responds; (3) furnish the name, address, and telephone number of the
person commenting, protesting or intervening; and (4) otherwise comply
with the requirements of 18 CFR 385.2001 through 385.2005. All
comments, motions to intervene, or protests must set forth their
evidentiary basis. Any filing made by an intervenor must be accompanied
by proof of service on all persons listed in the service list prepared
by the Commission in this proceeding, in accordance with 18 CFR
385.2010.

    Dated: June 10, 2022.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2022-12996 Filed 6-15-22; 8:45 am]
BILLING CODE 6717-01-P