The New York Stock Exchange, LLC and NYSE Amex, LLC (collectively, the Exchanges) have amended Rule 123C to provide the Exchanges with the ability to temporarily suspend certain rule requirements relating to closing of securities at the Exchanges. In October 2008, the NYSE amended Rule 48 to include the close of trading at a time when a qualified Exchange officer would be permitted to declare an extreme market volatility condition, which would allow the Exchanges to temporarily suspend certain rules. As set forth in Information Memo 09-20, the Exchanges have now deleted these provisions from Rule 48 and moved them to Rule 123C, some on a permanent basis and some on a pilot basis.
As part of the amendments to Rule 123C, pilot Rule 123C(8)(a)(1) provides that the Exchanges may temporarily suspend Rule 52 (which relates to hours of operation) on a security-by-security basis so that interest may be solicited—including interest that may not have been present prior to 4:00 p.m.—to offset any imbalance that may exist as of 4:00 p.m. (or earlier, in the case of an earlier scheduled close). In addition, under Rule 123C(8)(a)(2), the Exchanges may temporarily suspend the restriction on canceling a market-on-close or limit-on-close order that is a legitimate error after 3:50 p.m. on an order-by-order basis if such an erroneous order would cause significant price dislocation at the close. Procedurally, only the NYSE Designated Market Maker in a particular security may request the relief available under these amendments and must satisfy certain supervisory, approval and record-keeping requirements when doing so.
Please click here to read NYSE Regulation Information Memo 09-20.