02-3236. Options Price Reporting Authority; Order Approving Amendment to OPRA Plan to Exclude Foreign Currency Options from the Calculation of Capacity Allocation Provided for in the OPRA Plan

February 1, 2002.

I. Introduction

On December 10, 2001, Options Price Reporting Authority (“OPRA”),^[1] filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to Rule 11Aa3-2 under the Securities Exchange Act of 1934 (“Act”),^[2] an amendment to the Plan for Reporting of Consolidated Options Last Sale Reports and Quotation Information (“OPRA Plan”). The amendment would exclude foreign currency options (“FCOs”) from the calculation of capacity allocation provided for in the OPRA Plan.

The proposed amendment was published for comment in the Federal Register on January 4, 2002.^[3] No comments were received on the proposal. In this order, the Commission is approving the proposed amendment.

II. Description of the Proposal

OPRA proposes to revise certain provisions of Section III, “Definitions” and Section V(d), “Quarterly Calculation of Capacity Allocation” in order to exclude FCOs from the calculation of system capacity allocation that is provided for in the OPRA Plan and make available exclusively for the processing and dissemination of FCO market data a fixed amount of system capacity as determined by OPRA from time to time. The proposed amendment provides that the capacity available for FCO market data will be capable of handling at least 350 messages per second (“mps”), the amount currently assigned by OPRA to FCO market data. OPRA represents that such capacity is sufficient to meet the anticipated needs of the FCO market. OPRA represents that the proposed amendment would make no substantive change to the provisions of the OPRA Plan.

III. Discussion

After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder.^[4] Specifically, the Commission believes that the proposed OPRA Plan amendment is consistent with section 11A of the Act ^[5] and Rule 11Aa3-2 ^[6] thereunder in that it is appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanisms of, a national market system.

The Commission notes that the capacity available for FCO market data should be capable of handling at least 350 mps, which is the amount currently assigned by OPRA to FCO market data. OPRA has represented that such capacity is sufficient to meet the anticipated needs of the FCO market. The Commission also notes that OPRA has been advised by its Processor that exclusive of capacity set aside for the FCO market, the remaining capacity of the OPRA System is capable of handling at least 24,000 mps to process and disseminate market data for stock and index options. OPRA represents that this amount of system capacity is more than enough to fulfill OPRA's needs until the next planned increase in total capacity. Based on OPRA's representations, the Commission believes that it is reasonable for OPRA to exclude FCOs from the calculation of system capacity allocation and to separately determine a fixed amount of capacity for FCO market data. Accordingly, the Commission finds that the proposal is consistent with the Act.^[7]

IV. Conclusion

It is therefore ordered, pursuant to Rule 11Aa3-2 under the Act,^[8] that the proposed amendment (SR-OPRA-2001-03) is approved.

For the Commission, by the Division of Market Regulation, pursuant to delegated authority.^[9]

Margaret H. McFarland,

Deputy Secretary.

Footnotes

1.  OPRA is a national market system plan approved by the Commission pursuant to section 11A of the Exchange Act, 15 U.S.C. 78k-1, and Rule 11Aa3-2 thereunder, 17 CFR 240.11Aa3-2. See Securities Exchange Act Release No. 17638 (March 18, 1981), 22 SEC Docket 484 (March 31, 1981). The OPRA Plan provides for the collection and dissemination of last sale and quotation information on options that are traded on the participant exchanges. The five signatories to the OPRA Plan that currently operate an options market are the American Stock Exchange LLC, the Chicago Board Options Exchange, Inc., the International Securities Exchange LLC, the Pacific Exchange Inc., and the Philadelphia Stock Exchange, Inc. The New York Stock Exchange, Inc., is a signatory to the OPRA Plan, but sold its options business to the Chicago Board Options Exchange, Inc. in 1997. See Securities Exchange Act Release No. 38542 (April 23, 1997), 62 FR 23521 (April 30, 1997).

2.  17 CFR 240.11Aa3-2.

3.  Securities Exchange Act Release No. 45207 (December 28, 2001), 67 FR 619.

4.  In approving this proposed OPRA Plan amendment, the Commission has considered its impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).

5.  15 U.S.C. 78k-1.

6.  17 CFR 240.11A3-2.

7.  15 U.S.C. 78k-1.

8.  17 CFR 240.11Aa3-2.

9.  17 CFR 200.30-3(a)(29).