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Consolidated Tape Association; Notice of Filing and Immediate Effectiveness of Third Substantive Amendment to the Second Restatement of the Consolidated Tape Association Plan

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Start Preamble July 30, 2001.

Pursuant to Rule 11Aa3-2 [1] of the Securities Exchange Act of 1934 (“Act”), notice is hereby given that on July 16, 2001, the Consolidated Tape Association (“CTA”) participants (“Participants”) [2] filed with the Start Printed Page 41059Securities and Exchange Commission (“Commission” or “SEC”) amendments to the Restated CTA Plan. In the amendment, the Participants propose to modify the definitions of two CTA Plan terms that the Restated Consolidated Quote (“CQ”) Plan incorporates by reference. Thus, the CTA Plan amendment will also have the effect of causing the same modifications to the Restated CQ Plan. However, achieving that result does not require any change to the text of the Restated CQ Plan.

Pursuant to Rule 11A3-2(c)(3)(iii) under the Act,[3] the Participants designate the amendment as involving solely technical or ministerial matters of the CTA Plan. As a result, the amendment has become effective upon filing with the Commission.[4] The Participants submitted this notice of proposed amendment to the CTA Plan, which is an effective national market system plan,[5] pursuant to Rule 11Aa3-2(c).[6] The Commission is publishing notice to solicit comments from interested persons on the amendment.

1. Description and Purpose of the Amendment

A. Rule 11Aa3-2

The Participants propose to change the CTA Plan definitions of “Network A Eligible Securities” and “Network B Eligible Securities.” The changes would allow a security that is listed on AMEX or another natinal securities exchange to remain as a Network B Eligible Security in the event that NYSE determines to admit a security that is lited on AMEX to dealings on the basis of unlisted trading privileges (“UTP”). The changes to the definitions in the CTA Plan would also have the effect of changing in the same manner the meanings of “CQ Network A quotation information” and “CQ Network B quotation information” for the purposes of the Restated CQ Plan.

In addition, the Participants propose an amendment that would assure that a security that trades over the facilities of the NASDAQ Stock Market (other than an exchange-listed security) would not become a Network B Eligible Security if the NASDAQ Stock Market procures status as a national securities exchange.

Current, Section I(p) of the CTA Plan defines “Network A Eligible Securities” as “Eligible Securities admitted to dealings on NYSE”. Section I(q) defines “Network B Eligible Securities” as “Eligible Securities admitted to dealings on the AMEX, BSE, CBOE, CHX, CSE, PSE, PHLX or on any other exchange, but not also admitted to dealings on NYSE.” As a result of these definitions, if NYSE were to commence to trade a security that is listed on AMEX or on another exchange on the basis of UTP, the security would convert from a Network B Eligible Security to a Network A Eligible Security under the CTA Plan.

The proposed change would amend those definitions to prevent that conversion. That is, it would cause a security to remain a “Network B Eligible Security,” and not to convert to a “Network A Eligible Security,” if NYSE determines to admit the security to dealing on NYSE pursuant to UTP. Accordingly, last sale price information relating to such a security would remain “CTA Network B information” (as Section I(c) of the CTA Plan defines that term). Because the Restated CQ Plan incorporates by reference the CTA Plan definitions of “Network A Eligible Securities” and “Network B Eligible Securities,” this also means that quotation information relating to such a security would remain “CQ Network B quotation information” (as Section I(e) of the Restated CQ Plan defines that term).

As a further result of the proposed change, the terms and conditions of Network B market data contracts would apply to NYSE in respect of market data that NYSE makes available regarding Network B Eligible Securities that it admits to dealings pursuant to UTP. Also, NYSE would commence to share in Network B market data revenues insofar as trades in the shares of any such securities take place on NYSE.

CTA is aware that the NASDAQ Stock Market has applied for status as national securities exchange under Section 6 [7] of the Act. Under the CTA Plan's current definition of “Network B Eligible Securities,” all securities listed on the NASDAQ Stock Market would qualify as “Network B Eligible Securities” upon its registration as a national securities exchange. In order to avoid that unintended consequence, the proposed change provides that a security that is listed on a market other than NYSE or AMEX is not an “Eligible Security” if the listing exchange reports last sale information relating to the security pursuant to transaction reporting plan other than the CTA Plan (such as the transaction reporting plan through which the NASDAQ Stock Market currently reports trades in securities that are not listed on an exchange).

B. Governing or Constituent Documents

Not applicable.

C. Implementation of Amendment

Because the amendment involves solely technical or ministerial matters of the Plan, it has become effective upon filing with the Commission.[8] However, the amendment will not “be implemented” until the first instance in which NYSE admits to dealing on the basis of UTP a security that is listed on another exchange.

D. Development and Implementation Phases

The amendment requires no development or implementation phases.

E. Analysis of Impact on Completion

The amendment will impose no burden on competition.

F. Written Understanding or Agreements Relating to Interpretation of, or Participation in, the Plan

The Participants have no written understandings or agreements relating to interpretation of the CTA Plan as a result of the amendment.

G. Approval by Sponsors in Accordance With Plan

Under Section IV(b) of the CTA Plan, each CTA Plan Participant must execute a written amendment to the CTA Plan before the amendment can become effective. The amendment has been so executed.

H. Description of Operation of Facility Contemplated by the Proposed Amendment

Not applicable.

1. Terms and Conditions of Access

Not applicable.

J. Method of Determination and Imposition, and Amount of, Fees and Charges

The amendment makes no change in the method of determination and imposition, and amount of, fees and charges.Start Printed Page 41060

K. Method and Frequency of Processor Evaluation

Not applicable.

L. Dispute Resolution

Not applicable.

II. Rule 11Aa3-1

A. Reporting Requirements

Not applicable.

B. Manner of Collecting, Processing, Sequencing, Making Available and Disseminating Last Sale Information

If NYSE were to exercise UTP in respect of securities listed on another exchange, the amendment would require NYSE to report last sale price information and quotation information relating to those securities through the facilities that the Participants use to process, sequence, and disseminate Network B last sale price information and CQ Network B quotation information, rather than through network A facilities. The other Participants would continue to report their last sale price information and quotation information through the Network B facilities, just as they do today.

C. Manner of Consolidation

Not applicable.

D. Standards and Methods Ensuring Promptness, Accuracy and Completeness of Transaction Reports

Not applicable.

E. Rules and Procedures Addressed to Fraudulent or Manipulative Dissemination

Not applicable.

F. Terms of Access to Transaction Reports

Data users would continue to gain access to transaction reports relating to securities that are listed on other exchanges that NYSE admits to dealings on the basis of UTP by means of a Network B data feed, just as today.

G. Identification of Marketplace of Execution

Not applicable.

III. Solicitation of Comments

The CTA has designated these amendments as involving solely technical or ministerial matters, which, under Section 11Aa3-2(c)(3)(iii) of the Act,[9] renders the proposal effective upon receipt of this filing by the Commission

The Commission may summarily abrogate the amendment within sixty days of its filing and require refiling and approval of the amendment by Commission order pursuant to Section 11Aa3-2(c)(3)(iii) of the Act,[10] if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors or maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanisms of, a national market system, or otherwise in furtherance of the purposes of the Act.

Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the amendments are consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Copies of the submission, all subsequent amendments, all written statements with respect to the proposed plan amendments that are filed with the Commission, and all written communications relating to the proposed plan amendments between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission's Public Reference Room. Copies of such filing will also be available for inspection and copying at the principal office of the CTA. All submissions should refer to File No. SR-CTA-2001-03 and should be submitted by August 27, 2001.

Start Signature

For the Commission, by the Division of Market Regulation, pursuant to delegated authority.[11]

Margaret H. McFarland,

Deputy Secretary.

End Signature End Preamble


2.  Each Participant executed the amendment. The Participants are the American Stock Exchange LLC (“AMEX”), Boston Stock Exchange, Inc. (“BSE”), Chicago Board Options Exchange, Inc. (“CBOE”), Chicago Stock Exchange, Inc. (“CHX”), Cincinnati Stock Exchange, Inc. “CSE”), National Association of Securities Dealers, Inc. (“NASD”), New York Stock Exchange, Inc. (“NYSE”), Pacific Exchange, Inc. (“PCX”), and Philadelphia Stock Exchange, Inc. (“PHLX”).

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3.  17 CFR 240 11Aa3-2(c)(3)(ii).

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4.  The Participants initially filed the CTA Plan amendments on July 3, 2001, as concerned solely with the administration of the Plan, pursuant to Rule 11Aa3-2(c)(3)(ii) under the Act. The Participants amended the filing on July 16, 2001 to designate the filing as submitted pursuant to Rule 11Aa3-2(c)(iii) under the Act.

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5.  The CTA Plan has been designated as an effective transaction reporting plan pursuant to Rule 11Aa3-1(b). 17 CFR 240.11Aa3-1(b).

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8.  The Commission notes that the effective date of the filing is July 16, 2001, the date on which the Commission received the amendment to the proposal. See supra note 4.

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9.  17 CFR 240.11Aa3-2(c)(3)(iii).

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[FR Doc. 01-19526 Filed 8-3-01; 8:45 am]