Recently, staff of the Market Regulation Department has received numerous inquiries concerning a broker's responsibility under Rule 550 ("Post Settlement Session") with respect to customer orders.  Rule 550 states, in pertinent part:

During the post settlement session, members are obligated to bid or offer any orders that: (1) were received prior to the close; (2) were executable in the closing range; and (3) are executable in the post settlement session.  In addition, members are obligated to bid or offer any orders, including customer orders, that were received after the close and are executable in the post settlement session.

In 2001, Rule 550 was amended to allow customer orders to be entered after the close of Regular Trading Hours ("RTH"), eliminating the requirement that such orders be received and timestamped prior to the close.  The result of the change is that customer orders may now be placed at any time prior to the end of the post settlement session.

After the close of RTH, a member who accepts an order for pit or board execution whose terms allow for execution at the range of prices eligible for trading during the post settlement session is obligated pursuant to Rule 550 to attempt to execute such orders during the post settlement session.  As is the case with all customer orders, pursuant to Rule 540 ("Responsibility for Customer Orders") members must exercise due diligence in the handling of such orders.

If you have any questions concerning this information, please contact Greg Benbrook, Associate Director, Market Regulation, at 312/930.4529 or any of the Trading Floor Investigators or supervisory staff.