Order Execution Obligations

1Securities Exchange Act Release No. 37619A (September 6, 1996), 61 FR 48290 (‘‘Adopting Release’’). 2 17 CFR 240.11Ac1–4(d); 17 CFR 240.11Ac1– 1(d). 3 17 CFR 200.30–3. 4 5 U.S.C. 553(B)(3)(A). 17 CFR Part 240 [Release No. 34–38139; File No. S7–30–95 RIN 3235–AG66] Order Execution Obligations AGENCY: Securities and Exchange Commission. ACTION: Final rule; Revised Effective Date; Revised Compliance Dates. SUMMARY: The Securities and Exchange Commission is delaying the effective date and compliance dates for Rule 11Ac1–4 (‘‘Limit Order Display Rule’’) and amendments to Rule 11Ac1–1 (‘‘ECN Amendment’’) (cumulatively ‘‘Order Execution Rules’’). DATES: Effective Date: The effective date shall be January 20, 1997 for § 240.11Ac1–4 and amendments to § 240.11Ac1–1, published on September 12, 1996 (61 FR 48290), and revised by rule published on January 9, 1997, except that the effective date for § 240.11Ac1–1(a)(25)(ii) remains April 10, 1997. Compliance Dates: Each of the first three scheduled phase-in dates for compliance with the Order Execution Rules are being delayed one week, so that the first compliance date with respect to exchange-traded securities and 50 Nasdaq stocks shall be January 20, 1997, the phase-in date for an additional 100 Nasdaq securities shall be February 7, 1997, and the phase-in date for an additional 850 Nasdaq securities shall be February 28, 1997. FOR FURTHER INFORMATION CONTACT:
Betsy Prout Lefler, Special Counsel, Gail Marshall-Smith, Special Counsel, or David Oestreicher, Special Counsel, (202) 942–0158, Division of Market Regulation, Securities and Exchange Commission, 450 Fifth Street, N.W., Mail Stop 5–1, Washington, D.C. 20549. SUPPLEMENTARY INFORMATION:
I. Background
On August 28, 1996, the Securities and Exchange Commission

1386 Federal Register / Vol. 62, No. 7 / Friday, January 10, 1997 / Rules and Regulations 1 17 CFR 240.11Ac1–4. 3The Commission also amended subsection (a)(25)(ii) of the Quote Rule, thereby expanding the coverage of the Quote Rule to all exchange-traded securities. Thereafter, the Commission determined that it was appropriate to make this aspect of the amendments effective April 10, 1997. See Securities Exchange Act Release No. 38110, infra note 3. The present order does not change that date and, therefore, the effective date of subsection (a)(25)(ii) of the Quote Rule remains April 10, 1997. 3See Securities Exchange Act Release Nos. 37972 (November 22, 1996), and 38110 (January 2, 1997). (‘‘Commission’’) adopted Rule 11Ac1– 4,1 the ‘‘Limit Order Display Rule,’’ and amendments to Rule 11Ac1–1, the ‘‘ECN Amendment,’’ to require OTC market makers and exchange specialists to display certain customer limit orders, and to publicly disseminate the best prices that the OTC market maker or exchange specialist has placed in certain electronic communications networks (‘‘ECNs’’), or to comply indirectly with the ECN Amendment by using an ECN that furnishes the best market maker and specialist prices therein to the public quotation system.2 In the Adopting Release, the Commission deemed the effective date of these initiatives January 10, 1997. Thereafter, the Commission modified the effective date of the rules to January 13, 1997, and established compliance dates with respect to the Limit Order Display Rule and the ECN Amendment so that compliance with the rules would be phased-in over several months.3 In order to allow market participants more time to adapt to the Order Execution Rules and the National Association of Securities Dealers’ recently proposed amendments to its Small Order Execution System, SelectNet, and other rules to accommodate the Order Execution Rules, the Commission is hereby modifying the effective dates and compliance dates as follows: (1) the effective date for the Limit Order Display Rule and the amendments to the Quote Rule adopted August 28, 1996, shall be January 20, 1997. The effective date for the Quote Rule definition of ‘‘subject security,’’ § 240.11Ac1– 1(a)(25)(ii), remains April 10, 1997; (2) each of the first three scheduled phase￾in dates for compliance with the Order Execution Rules are being delayed one week, so that the first compliance date with respect to exchange-traded securities and 50 Nasdaq stocks shall be January 20, 1997, the phase-in date for an additional 100 Nasdaq securities shall be February 7, 1997, and the phase-in date for an additional 850 Nasdaq securities shall be February 28,
1997. The remaining compliance dates
for the Limit Order Display Rule and the ECN Amendment remain unchanged. For the Commission, by the Division of Market Regulation, pursuant to delegated authority, 17 CFR 200.30(a)(62). Dated: January 8, 1997. Margaret H. McFarland, Deputy Secretary. [FR Doc. 97–823 Filed 1–9–97; 8:45 am] BILLING CODE 8010–01–M