Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the New York Stock Exchange, Inc. To Extend the Implementation Date To Establish a Six-Month Pilot Program Permitting a Floor Broker To Use an Exchange Authorized and Provided Portable Telephone on the Exchange Floor

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), and Rule 19b-4 thereunder, notice is hereby given that on May 27, 2003, the New York Stock Exchange, Inc. (“NYSE” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. 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 extend the implementation date for the six-month pilot program that would permit a Floor broker to use an Exchange authorized and provided portable telephone on the Exchange Floor to begin no later than June 23, 2003, instead of on or about May 1, 2003, as originally adopted with the approval of SR-NYSE-2002-11.

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 these 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 aspects of such statements.

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

1. Purpose

In the Original Order, the Commission approved the Exchange's amendment to NYSE Rule 36 to permit a Floor broker to use an Exchange authorized and provided portable telephone on the Floor to be implemented as a six-month pilot beginning on or about May 1, 2003. The Exchange also committed in the Original Order to complete a study of communications on the Exchange Floor within three months of implementation of the portable telephone pilot program, which would have been on or about August 1, 2003. In addition, the Exchange committed to notify the Commission's Office of Compliance, Inspections & Examinations (“OCIE”), the Division of Market Regulation (“Division”), and the Exchange's membership within one week prior to the actual implementation date.

The Exchanges states that the implementation date in the Original Order (on or about May 1, 2003) was delayed pending the finalization of several contract issues with the provider of portable phone service. The Exchange now proposes to implement the six-month pilot program no later than June 23, 2003, with a commitment to complete the above-mentioned study no later than September 23, 2003. In addition, the Exchange reiterates its commitment to notify the Commission's OCIE, the Division, and the Exchange's membership one week prior to the actual implementation date.

2. Statutory Basis

The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act in general, and furthers the objectives of Section 6(b)(5) of the Act in particular, in that it is designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the 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.

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

The Exchange has neither solicited nor received written comments on the proposed rule change.

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

Because the proposed rule change, as amended, (1) does not significantly affect the protection of investors or the public interest; (2) does not impose any significant burden on competition; and (3) does not become operative for 30 days from the date of filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, and the Exchange provided the Commission with written notice of its intent to file the proposed rule change at least five days prior to the filing date, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act, and subparagraph (f)(6) of Rule 19b-4 thereunder. 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.

The Exchange requests that the Commission waive the 30-day delayed operative date of Rule 19b-4(f)(6)(iii). The Exchange believes that waiver of this period will allow the Exchange to immediately implement the use of Exchange authorized and provided portable telephones on the Floor.

The Commission believes that it is consistent with the protection of investors and the public interest to waive the 30-day operative delay and make this proposed rule change immediately effective. The Commission believes that the waiver of the 30-day operative delay will allow the NYSE to immediately notify the public of the general timeframe to implement its proposal to allow Exchange provided and authorized portable telephones on the Floor, consistent with the protection of investors and the public interest.

The Commission also reiterates its expectation from the Original Order that the NYSE complete, within three months of implementation of the portable telephones, a study of communications on the Exchange Floor, pursuant to a recommendation of an Independent Consultant retained by the Exchange, and to provide notice to NYSE members, the Division, and OCIE one week prior to the pilot program's implementation. In addition to the study, the Commission, as noted in the Original Order, requests that the Exchange report any problems, surveillance or enforcement matters associated with the Floor brokers' use of an Exchange authorized and provided portable telephone on the Floor. If the NYSE decides to request permanent approval or an extension of the pilot, we would expect, in addition to the report due in three months, that the NYSE submit information documenting the usage of the phones, any problems that have occurred, and any advantages or disadvantages that have resulted.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change, as amended, is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 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 Room. Copies of such filing will also be available for inspection and copying at the principal office of the NYSE. All submissions should refer to File No. SR-NYSE-2003-19 and should be submitted by July 2, 2003.