Rule 19b-5 permits a self-regulatory
organization (SRO) to operate a pilot trading system, under certain
conditions, for two years without submitting a proposed rule change
to the Commission pursuant to Rule 19b-4. SROs availing themselves
of Rule 19b-5 are required to file a Form PILOT at least 20 days
before com- mencing operation of the system. SROs are also required
to file notices of material systems changes and quarterly activity
re- ports on Form PILOT.
US Code:
15
USC 78s(b) Name of Law: Securities Exchange Act of 1934
The estimates of burden under
Rule 19b-5 have decreased since the prior submission. In the prior
submission, the Commission anticipated receiving as many as six
proposals per year from six respondents to operate pilot trading
systems filed as initial reports on Form PILOT each year. The
Commission estimated that each respondent would file four quarterly
reports on Form PILOT per year, for a total of 24 quarterly reports
from all respondents, and 2 notices of material systems changes on
Form PILOT per year, for a total of 12 notices of material systems
changes from all respondents. Since the prior submission, the
Commission has received no initial reports on Form PILOT. The
Commission has received four Form PILOT submissions since Rule
19b-5 was adopted and the Form PILOT process was created in 1998.
Additionally, no pilot trading system is currently operating under
the Rule 19b-5 exemption. Based on these facts and circumstances,
at this time the Commission anticipates receiving up to three
proposals to operate pilot trading systems filed as initial reports
on Form PILOT each year. The Commission continues to estimate that
each respondent filing an initial proposal would file four
quarterly reports on Form PILOT per year, for a total of 12
quarterly reports from all respondents, and 2 notices of material
systems changes on Form PILOT per year, for a total of 6 notices of
material systems changes from all respondents. Based on the
Commissions experience with Rule 19b-5 since its adoption, the
Commission now believes that it would be reasonable to make a much
lower estimate of the number of pilot trading systems that will be
established by SROs over the next three-year period pursuant to
Rule 19b-5. Although the Commission anticipates fewer initial
filings on Form PILOT, and thus fewer overall quarterly filings and
notices of material systems changes, the Commission estimates the
time required to complete an initial form, quarterly report or
notice of material system change to be the same. Therefore, the
estimated aggregate reporting burden to all respondents in a year
under Rule 19b-5 has decreased from 252 hours to 126 hours.
Although the total estimated annual hour compliance burden has
decreased, the estimated related cost associated with such burden
has increased from $13,030 to $38,775 due to increases in the
hourly estimated rates for professional legal work and clerical
work
$6,663
No
No
No
Uncollected
No
Uncollected
Sarah Schandler 202
551-7145
No
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.
Form SEC 2552 Rule 19b-5 Under the Securities Exchange Act of 1934; Pilot Trading System Rule Filing Requirements (Initial Reports)
2010 Rule 19b-5 Justification.doc
Rule 19b-5 Under the Securities Exchange Act of 1934; Pilot Trading System Rule Filing Requirements (Initial Reports)