E8-24754. Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Rules Governing Doing Business With the Public

October 8, 2008.

Pursuant to Section 19(b)(1) ^[1] of the Securities Exchange Act of 1934 (“Act”) ^[2] and Rule 19b-4 thereunder,^[3] notice is hereby given that, on September 25, 2008, NYSE Arca, Inc. (“NYSE Arca” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I and II below, which Items have been substantially prepared by the Exchange. The Exchange has designated the proposed rule change as constituting a “non-controversial” rule change under paragraph (f)(6) of Rule 19b-4 under the Act,^[4] which renders the proposal effective upon receipt of this filing by the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

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

The Exchange proposes to amend certain rules that govern an Exchange member's conduct in doing business with the public. The proposed rule change would require member organizations to integrate the responsibility for supervision of a member organization's public customer options business into its overall supervisory and compliance program. In addition, the Exchange proposes to amend certain rules to strengthen member organizations' supervisory procedures and internal controls as they relate to a member's public customer options business. The text of the proposed rule is available on the Exchange's Web site at http://www.nyse.com, at the Exchange's principal office, and at the Commission's Public Reference Room.

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

In its filing with the Commission, the Exchange included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.

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

1. Purpose

The purpose of the proposed rule change is to create a supervisory structure for options that is similar to that required by New York Stock Exchange (“NYSE”) and Financial Industry Regulatory Authority (“FINRA”) (f/k/a the National Association of Securities Dealers (“NASD”)) rules.^[5] The proposed rule change would eliminate the requirement that member organizations qualified to do a public customer business in options must designate a single person to act as Senior Registered Options Principal (“SROP”) for the member organization and that each such member organization designate a specific individual as a Compliance Registered Options Principal (“CROP”). Instead member organizations would be required to integrate the SROP and CROP functions into their overall supervisory and compliance programs.

The SROP concept was first introduced by the Chicago Board Options Exchange (“CBOE”) during the early years of the development of the listed options market. Previously, under CBOE rules, member organizations were required to designate one or more persons qualified as ROPs having supervisory responsibilities in respect to the member organization's options business. As the number of ROPs at larger member organizations began to increase, options exchanges imposed an additional requirement that member organizations designate one of their ROPs as the SROP. This was intended to eliminate confusion as to where the compliance and supervisory responsibilities lay by centralizing in a single supervisory officer overall responsibility for the supervision of a member organization's options activities.^[6] Subsequently, following the recommendation of the Commission's Options Study, options exchanges required member organizations to designate a CROP to be responsible for the member organization's overall compliance program in respect to its options activities.^[7] The CROP may be the same person who is designated as SROP.

Since the SROP and CROP requirements were first imposed, the supervisory function in respect to the options activities of most securities firms has been integrated into the matrix of supervisory and compliance functions in respect to the firms' other securities activities. This not only reflects the maturity of the options market, but also recognizes the ways in which the uses of options themselves have become more integrated with other securities in the implementation of particular strategies. Thus, the current requirement for a separately designated senior supervisor in respect to all aspects of a member organization's options activities, rather than clarifying the allocation of supervisory responsibilities within the member organization, may have just the opposite effect by failing to take into account the way in which these responsibilities are actually assigned. In addition, by permitting supervision of a member organization's options activities to be handled in the same manner as the supervision of its other securities activities as well as its futures activities, the proposed rule change is designed to ensure that supervisory responsibility over each segment of the member organization's business is assigned to the best qualified persons in the member organization, thereby enhancing the overall quality of supervision. The same holds true for the compliance function.

For example, most member organizations have designated one person to have supervisory responsibility over the application of margin requirements and other matters pertaining to the extension of credit. The proposed rule change would enable a member organization to include within the scope of such a person's duties the supervision over the proper margining of options accounts, thereby assuring that the most qualified person is charged with this responsibility and at the same time eliminating any uncertainty that might now exist as to whether this responsibility lies with the senior credit supervisor or with the SROP.

Similarly, the proposed rule change would allow a member organization to specifically designate one or more individuals as being responsible for approving a ROP's acceptance of discretionary accounts^[8] and exceptions to a member organization's suitability standards for trading uncovered short options.^[9] The proposed rule change would allow member organizations the flexibility to assign such responsibilities, which formerly rested with the SROP and/or CROP, to more than one ROP-qualified individual where the member organization believes it advantageous to do so to enhance its supervisory or compliance structure. Typically, a member organization may wish to divide these functions on the basis of geographic region or functional considerations. The proposed amendment to Rule 9.26 would clarify the qualification requirements for individuals designated as ROPs.^[10]

The proposed rule change would require options discretionary accounts, the acceptance of which must be approved by a ROP-qualified individual (other than the ROP who accepted the account), to be supervised in the same manner as the supervision of other securities accounts that are handled on a discretionary basis. The proposed rule change would also eliminate the requirement that discretionary options orders be approved on the day of entry by a ROP (with one exception, as described below). This requirement predates the Options Study and is not consistent with the use of supervisory tools in computerized format or exception reports generated after the close of a trading day. No similar requirement exists for supervision of other securities accounts that are handled on a discretionary basis.^[11] Discretionary orders must be reviewed in accordance with a member organization's written supervisory procedures. The proposed rule change would ensure that supervisory responsibilities are assigned to specific ROP-qualified individuals, thereby enhancing the quality of supervision.

The proposed rule change would revise Exchange Rule 9.18(e) by adding, as Commentary .02, a requirement that any member organization that does not utilize computerized surveillance tools for the frequent and appropriate review of discretionary account activity must establish and implement procedures to require ROP-qualified individuals who have been designated to review discretionary accounts to approve and initial each discretionary order on the day entered. The Exchange believes that any member organization that does not utilize computerized surveillance tools to monitor discretionary account activity should continue to be required to perform the daily manual review of discretionary orders.

Under the proposed rule change, options discretionary accounts would continue to receive frequent appropriate supervisory review by designated ROP-qualified individuals. Additionally, member organizations would continue to be required to designate ROP-qualified individuals to review and approve the acceptance of options discretionary accounts in order to determine whether the ROP accepting the account had a reasonable basis for believing that the customer was able to understand and bear the risks of the proposed strategies or transactions. This requirement would provide an additional level of supervisory audit over options discretionary accounts that do not exist for other securities discretionary accounts.

In addition, the proposed rule change would require that each member organization submit to the Exchange a written report by April 1 of each year that details the member organization's supervision and compliance effort, including its options compliance program, during the preceding year and reports on the adequacy of the member organization's ongoing compliance processes and procedures.^[12]

Proposed Rule 9.18(d)(2)(H) would require that each member organization submit, by April 1 of each year, a copy of the Rule 9.18(d)(2)(G) annual report to one or more of its control persons or, if the member organization has no control person, to the audit committee of its board of directors or its equivalent committee or group.^[13]

Proposed Rule 9.18(d)(2)(G) would provide that a member organization that specifically includes its options compliance program in a report that complies with substantially similar requirements of NYSE and NASD rules will be deemed to have satisfied the requirements of Rules 9.18(d)(2)(G) and 9.18(d)(2)(H).

Although the proposed rule change would eliminate entirely the positions and titles of the SROP and CROP, member organizations would still be required to designate a single general partner or executive officer to assume overall authority and responsibility for internal supervision, control of the member organization and compliance with securities laws and regulations.^[14] Member organizations would also be required to designate specific qualified individuals as having supervisory or compliance responsibilities over each aspect of the member organization's options activities and to set forth the names and titles of these individuals in their written supervisory procedures.^[15] This is consistent with the integration of options supervision into the overall supervisory and compliance structure of a member organization. In connection with the approval of the proposed rule change, the Exchange intends to review member organizations' written supervisory and compliance procedures in the course of the Exchange's routine examination of member organizations to ensure that supervisory and compliance responsibilities are adequately defined.

The Exchange believes that the proposed rule change recognizes that options are no longer in their infancy, have become more integrated with other securities in the implementation of particular strategies, and thus should not continue to be regulated as though they are a new and experimental product. The Exchange believes that the proposed rule change is appropriate and does not materially alter the supervisory operations of member organizations. The Exchange believes the supervisory and compliance structure in place for non-options products at most member organizations is not materially different from the structure in place for options.

Supervisory Procedures and Internal Controls

The Exchange also proposes to amend certain rules to strengthen member and member organizations' supervisory procedures and internal controls as they relate to a member's public customer options business. The proposed rule changes described below are modeled after NYSE, NASD and CBOE rules approved by the Commission in 2004 ^[16] and in 2007,^[17] respectively. The Exchange believes the following proposal to strengthen member supervisory procedures and internal controls is appropriate and consistent with the preceding proposal to integrate options and non-options sales practice supervision and compliance functions.

The proposed revisions to Exchange Rule 9.18(d)(1)(C) would require the development and implementation of written policies and procedures reasonably designed to supervise sales managers and other supervisory personnel who service customer options accounts (i.e., who act in the capacity of a registered representative).^[18] This requirement would apply to branch office managers, sales managers, regional/district sales managers, or any person performing a similar supervisory function. Such policies and procedures are expected to encompass all options sales-related activities. Proposed Rule 9.18(d)(1)(C)(i) would require that supervisory reviews of producing sales managers be conducted by a qualified ROP who is either senior to, or otherwise “independent of,” the producing manager under review.^[19] This provision is intended to ensure that all options sales activity of a producing manager is monitored for compliance with applicable regulatory requirements by persons who do not have a personal interest in such activity.

Proposed Rule 9.18(d)(1)(C)(ii) would provide a limited exception for members so limited in size and resources that there is no qualified person senior to, or otherwise independent of, the producing manager to conduct the review. In this case, the reviews may be conducted by a qualified ROP to the extent practicable. Under proposed Rule 9.18(d)(1)(C)(iii), a member relying on the limited size and resources exception would be required to document the factors used to determine that compliance with each of the “senior” or “otherwise independent” standards of Rule 9.18(d)(1)(C)(i) is not possible, and that the required supervisory systems and procedures in place with respect to any producing manager comply with the provisions of Rule 9.18(d)(1)(C)(i) to the extent practicable.

Proposed paragraph (d)(1)(C)(iv) of Rule 9.18 would provide that a member organization that complies with requirements of NYSE or NASD rules that are substantially similar to the requirements in Rules 9.18(d)(1)(C)(i), (d)(1)(C)(ii) and (d)(1)(C)(iii) will be deemed to have met such requirements.

Under proposed Rule 9.18(d)(2)(A), a member, upon a customer's written instructions, may hold mail for a customer who will not be at his or her usual address for no longer than two months if the customer is on vacation or traveling, or three months if the customer is going abroad. This provision would help ensure that members that hold mail for customers who are away from their usual addresses, do so only pursuant to the customer's written instructions and for a specified, relatively short period of time.^[20]

Proposed Rule 9.18(d)(2)(B) would require that, before a customer options order is executed, the account name or designation must be placed upon the memorandum for each transaction. In addition, only a qualified ROP would be permitted to approve any changes in account names or designations. The ROP also would be required to document the essential facts relied upon in approving the changes and maintain the record in a central location. A member would be required to preserve any account designation change documentation for a period of not less than three years, with the documentation preserved for the first two years in an easily accessible place, as the term “easily accessible place” is used in Rule 17a-4 of the Act.^[21] The Exchange believes the proposed rule would help to protect account name and designation information from possible fraudulent activity.^[22]

Proposed Rule 9.18(d)(2)(C) would require member organizations to develop and maintain adequate controls over each of their business activities. The proposed rule further would require that such controls include the establishment of procedures to independently verify and test the supervisory systems and procedures for those business activities. Member organizations would be required to include in the annual report prepared pursuant to Rule 9.18(d)(2)(G) a review of the member organization's efforts in this regard, including a summary of the tests conducted and significant exceptions identified. The Exchange believes proposed Rule 9.18(d)(2)(C)(i) would enhance the quality of member organizations' supervision.^[23]

Proposed Rule 9.18(d)(2)(C)(ii) would provide that a member organization that complies with requirements of NYSE or NASD rules that are substantially similar to the requirements in Rule 9.18(d)(2)(C)(i) will be deemed to have met such requirements.

Proposed Rule 9.18(d)(2)(D)(1) would establish requirements for branch office inspections similar to the requirements of NYSE Rule 342.24. Specifically, proposed Rule 9.18(d)(2)(D)(2) would require a member organization to inspect each supervisory branch office at least annually and each non-supervisory branch office at least once every three years.^[24] The proposed rule further would require that persons who conduct a member organization's annual branch office inspection must be independent of the direct supervision or control of the branch office (i.e., not the branch office manager, or any person who directly or indirectly reports to such manager, or any person to whom such manager directly reports). The Exchange believes that requiring branch office inspections be conducted by someone who has no significant financial interest in the success of a branch office should lead to more objective and vigorous inspections.

Under proposed Rule 9.18(d)(2)(E), any member organization seeking an exemption, pursuant to Rule 9.18(d)(2)(D)(ii), from the annual branch office inspection requirement would be required to submit to the Exchange written policies and procedures for systematic risk-based surveillance of its branch offices, as defined in Rule 9.18(d)(2)(E). Proposed Rule 9.18(d)(2)(F) would require that annual branch office inspection programs include, at a minimum, testing and verification of specified internal controls.^[25] Proposed Rule 9.18(d)(2)(D)(3) would provide that a member organization that complies with requirements of NYSE or NASD rules that are substantially similar to the requirements in Rules 9.18(d)(2)(D), (E) and (F) will be deemed to have met such requirements.

In conjunction with the proposed changes to Rules 9.18(d)(2)(D), (E) and (F), the Exchange proposes to amend Rule 9.18(m) Commentary .01 to define “branch office” in a way that is substantially similar to the definition of branch office in NYSE Rule 342.10.

Proposed Rule 9.18(d)(2)(G)(4) would require a member organization to designate a Chief Compliance Officer (“CCO”). Proposed Rule 9.18(d)(2)(G)(5) would require each member organization's Chief Executive Officer (“CEO”), or equivalent, to certify annually that the member organization has in place processes to: (1) Establish and maintain policies and procedures reasonably designed to achieve compliance with applicable Exchange rules and federal securities laws and regulations; (2) modify such policies and procedures as business, regulatory, and legislative changes and events dictate; and (3) test the effectiveness of such policies and procedures on a periodic basis, the timing of which is reasonably designed to ensure continuing compliance with Exchange rules and federal securities laws and regulations.

Proposed Rule 9.18(d)(2)(G)(5) further would require the CEO to attest that the CEO has conducted one or more meetings with the CCO in the preceding 12 months to discuss the compliance processes in proposed Rule 9.18(d)(2)(G)(5)(ii), that the CEO has consulted with the CCO and other officers to the extent necessary to attest to the statements in the certification, and the compliance processes are evidenced in a report, reviewed by the CEO, CCO, and such other officers as the member organization deems necessary to make the certification, that is provided to the member organization's board of directors and audit committee (if such committee exists).^[26]

Rule 9.18(e) allows member organizations to exercise time and price discretion on orders for the purchase or sale of a definite number of options contracts in a specified security. The Exchange proposes to amend Rule 9.18(e) to limit the duration of this discretionary authority to the day it is granted, absent written authorization to the contrary. In addition, the proposed rule would require any exercise of time and price discretion to be reflected on the customer order ticket. The proposed one-day limitation would not apply to time and price discretion exercised for orders affected with or for an institutional account pursuant to valid Good-Till-Cancelled instructions issued on a “not held” basis. The Exchange believes that investors will receive greater protection by clarifying the time such discretionary orders remain pending.^[27]

The proposed rule changes listed above are substantially similar to changes already implemented by the NYSE, NASD (n/k/a FINRA) and CBOE.^[28]

2. Statutory Basis

The proposed rule change would integrate the supervision and compliance functions relating to member organizations' public customer option activities into the overall supervisory structure of a member organization, thereby eliminating any uncertainty over where supervisory responsibilities lies. The proposed rule change would also foster the strengthening of member organizations' internal controls and supervisory systems. As such, the proposed rule changes are consistent with, and further the objectives of, Section 6(b)(5) ^[29] of the Act, in that they are designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts and practices, to remove impediments to and perfect the mechanisms of a free and open market and a national market system, and in general, to protect investors and public interest.

B. Self-Regulatory Organization's Statement on Burden on Competition

The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. This rule change is consistent with the regulatory framework maintained by the NYSE, FINRA and CBOE and as such does not impose any burden on competition or significantly affect the protection of investors.

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

No written comments were solicited or received with respect to the proposed rule change.

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

Pursuant to Section 19(b)(3)(A) of the Act ^[30] and Rule 19b-4(f)(6) ^[31] thereunder, NYSE Arca has designated this proposed rule change as one that does not:

(i) Significantly affect the protection of investors or the public interest;

(ii) impose any significant burden on competition; and

(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest.

The Exchange notes that the proposed amendment does not propose any new policies or provisions that are unique or unproven and is substantially similar to NYSE, FINRA, and CBOE rules. For the foregoing reasons, the Exchange believes that this rule filing qualifies for expedited effectiveness as a “non-controversial” rule change under paragraph (f)(6) of Rule 19b-4 of the Act.

The Exchange provided the Commission with written notice of its intent to file this proposed rule change at least five business days prior to the date of the filing.^[32] The Exchange requests that the Commission waive the 30-day operative delay contained in Rule 19b-4(f)(6) of the Act so that certain Exchange Rules that govern an Exchange member's conduct in doing business with the public can come immediately inline with those of the NYSE, FINRA, and CBOE, thereby providing simplicity and clarity for cross-member firms. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest. The Commission therefore grants the Exchange's request and designates the proposal to be operative upon filing.^[33]

At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

• Use the Commission's Internet comment form (http://www.sec.gov/​rules/​sro.shtml); or
• Send an e-mail to [e-mail]. Please include File Number SR-NYSEArca-2008-102 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEArca-2008-102. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/​rules/​sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission's Public Reference Section, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of the filing will also be available for inspection and copying at NYSE Arca's principal office and on its Internet Web site at http://www.nyse.com. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2008-102 and should be submitted on or before November 10, 2008.

For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.³⁴

Florence E. Harmon,

Acting Secretary.

Footnotes

1.  15 U.S.C. 78s(b)(1).

2.  15 U.S.C. 78a.

3.  17 CFR 240.19b-4.

4.  17 CFR 240.19b-4(f)(6).

5.  See NYSE Rule 342 and NASD Rule 3010.

6.  See Securities and Exchange Commission, 96th Cong., 1st Sess., Report of the Special Study of the Options Markets (Comm. Print 1978) 316 fn. 11 (“Options Study”).

7.  Id. at p. 335.

8.  See proposed Rule 9.18(e).

9.  See proposed Rule 9.18(b)(6)(C).

10.  See commentaries .02 and .04 to proposed Rule 9.26.

11.  See e.g., NYSE Rule 408.

12.  See proposed Rule 9.18(d)(2)(G) which is modeled after NYSE Rule 342.30.

13.  Proposed Rule 9.18(d)(2)(H) is modeled after NYSE Rule 354.

14.  See proposed Rule 9.18(d)(1).

15.  See commentary .01 to proposed Rule 9.18(d).

16.  See Securities Exchange Act Release No. 49882 (June 17, 2004), 69 FR 35108 (June 23, 2004) (SR-NYSE-2002-36), and Securities Exchange Act Release No. 49883 (June 17, 2004), 69 FR 35092 (June 23, 2004) (SR-NASD-2002-162).

17.  See Securities Exchange Act Release No. 56492 (September 21, 2007), 72 FR 54952 (September 27, 2007) (SR-CBOE-2007-106).

18.  Proposed Rule 9.18(d)(1)(C) is modeled after NYSE Rule 342.19.

19.  An “otherwise independent” person is defined in proposed Rule 9.18(d)(1)(C)(i) as one who: Is either senior to, or otherwise independent of, the producing manager under review. For purposes of this Rule, an “otherwise independent” person: May not report either directly or indirectly to the producing manager under review; must be situated in an office other than the office of the producing manager; must not otherwise have supervisory responsibility over the activity being reviewed; and must alternate such review responsibility with another qualified person every two years or less. Further, if a person designated to review a producing manager receives an override or other income derived from that producing manager's customer activity that represents more than 10% of the designated person's gross income derived from the member organization over the course of a rolling twelve-month period, the member organization must establish alternative senior or otherwise independent supervision of that producing manager to be conducted by a qualified Registered Options Principal other than the designated person receiving the income.

20.  Proposed Rule 9.18(d)(2)(A) is modeled after NASD Rule 3110(i).

21.  17 CFR 240.17a-4.

22.  Propose Rule 9.18(d)(2)(B) is modeled after NASD Rule 3110(j).

23.  Proposed Rule 9.18(d)(2)(C)(i) is modeled after NYSE Rule 342.23. Paragraph (C)(ii) would provide that a member organization that complies with requirements of NYSE or the NASD that are substantially similar to the requirements in Rule 9.18(d)(2)(C)(i) will be deemed to have met such requirements.

24.  Proposed Rules 9.18(d)(2)(D)(1)(i) and (ii) would provide members with two exceptions from the annual branch office inspection requirement; a member may demonstrate to the satisfaction of the Exchange that other arrangements may satisfy the Rule's requirements for a particular branch office, or based upon a member organization's written policies and procedures providing for a systematic risk-based surveillance system, the member organization submits a proposal to the Exchange and receives, in writing, an exemption from this requirement pursuant to Rule 9.18(d)(2)(E).

25.  Proposed Rules 9.18(d)(2)(E) and (d)(2)(F) are modeled after NYSE Rules 342.25 and 342.26.

26.  Proposed Rule 9.18(d)(2)(G)(5) is modeled after NASD Rule 3013 and NYSE Rule 342.30(e).

27.  Proposed Rule 9.18(e)(i) is modeled after NASD Rule 2510(d)(l).

28.  See supra notes 16 and 17.

29.  15 U.S.C. 78f(b)(5).

30.  15 U.S.C. 78s(b)(3)(A).

31.  17 CFR 240.19b-4(f)(6).

32.  Id. Rule 19b-4(f)(6)(iii) requires a self-regulatory organization to give the Commission written notice of its intent to file a proposed rule change at least five business days prior to the date of the filing of the proposed rule, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement.

33.  For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule's impact on efficiency, competition and capital formation. See 15 U.S.C. 78c(f).

34.  17 CFR 200.30-3(a)(12).