[Federal Register Volume 72, Number 60 (Thursday, March 29, 2007)]
[Notices]
[Pages 14842-14844]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-5816]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-55517; File No. SR-NYSE-2007-06]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing of Proposed Rule Change to NYSE Rule 440A (``Telephone
Solicitations'')
March 23, 2007.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act''),\2\ and Rule 19b-4 thereunder, notice is hereby given
that on January 25, 2007, the New York Stock Exchange LLC (``NYSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed amendments to its Rule 440A, 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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The New York Stock Exchange LLC is filing with the Securities and
Exchange Commission proposed Rule 440A (``Telephone Solicitations'')
which addresses member organizations' telephone solicitations of
customers.
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 the proposed rule change is available on the
[[Page 14843]]
NYSE's Web site (http://www.NYSE.com), at the NYSE's principal office,
and at the Commission's Public Reference Room. 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
NYSE Rule 440A (the ``Rule'') addresses member organizations'
telephone solicitations of customers. Rule 440A(g) provides ``No member
or member organization may use a telephone facsimile machine, computer
or other device to send an unsolicited advertisement to a telephone
facsimile machine, computer or other device.''
Subsection 440A(g)(1) provides that a facsimile advertisement is
not ``unsolicited'' where the recipient has granted the member
organization prior express invitation or permission to deliver the
advertisement, as further defined in the Rule. This proposed amendment
to NYSE Rule 440A would provide that such an advertisement also will
not be considered ``unsolicited'' where there is an ``established
business relationship'' as defined in the present Rule 440A(j).
In addition, changes are proposed to delete the term ``member'' as
used in the Rule to reflect the recent reorganization of the
Exchange,\3\ and the term ``allied member'' as redundant within the
context of the present regulation.
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\3\ See Exchange Act Release No. 53382 (Feb. 27, 2006), 71 FR
11251 (Mar. 6, 2006) (SR-NYSE-2005-77).
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Background
The amendments to Rule 440A(g) were adopted by the Exchange on
December 2, 2004 \4\ to incorporate regulations issued by the Federal
Communications Commission (``FCC'') and the Federal Trade Commission
(``FTC'') relating to the implementation of the National Do Not Call
registry and the amendments to the Telephone Consumer Protection Act of
1991.\5\ The FCC and FTC regulations contained no exception for
facsimiles sent to customers with which a broker-dealer had an
``established business relationship'' as such term was defined.
Subsequently, Congress passed legislation \6\ which restored an
exemption for unsolicited faxes sent to a recipient with whom the
sender had an established business relationship. Accordingly, the
proposed amendments to NYSE Rule 440A(g)(1) will add an exception for
established business relationships to the definition of ``unsolicited''
and will also set forth the measures necessary for a customer to opt
out of the receipt of further communications. These standards, which
are taken from applicable FCC regulations,\7\ generally require that
the member organization and the person not only have an established
business relationship,\8\ but also that the member organization obtain
the fax number from the recipient (or the recipient's web site,
directory, or advertisement). Further, the recipient must not have
stated on those materials that they do not accept unsolicited
advertisements at the listed number. The member organization must also
take reasonable steps to verify that the recipient consented to have
the number listed.\9\
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\4\ See Exchange Act Release No. 34-52579 (Oct. 7, 2005), 70 FR
60119 (Oct. 14, 2005) (SR-NYSE-2004-73).
\5\ Rules and Regulations Implementing the Telephone Consumer
Protection Act of 1991, FCC 03-153 (Jun. 26, 2003), 68 FR 44144
(Jul. 25, 2003).
\6\ Junk Fax Prevention Act of 2005, Pub. L. 109-21, 119 Stat.
359 (2005).
\7\ FCC 06-42 (Apr. 5, 2006), 71 FR 56893 (Sept. 28, 2006).
\8\ An established business relationship is defined as a prior
existing relationship formed by voluntary two-way communication
between a member organization and a person where the person has,
generally speaking, done business with the member organization
within the 18 months preceding the telephone call, the member
organization is the broker-dealer of record for the person's account
within those 18 months, or the person has contacted the member
organization to inquire about a product or service within the three
months preceding the telephone call.
\9\ The Exchange expanded this description of the standards and
added the definition of ``established business relationship'' to
this notice during a telephone conversation between William Jannace,
Managing Director, Rule and Interpretive Standards, NYSE Regulation,
and Elizabeth MacDonald, Special Counsel, Division of Market
Regulation, Commission, March 20, 2007.
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b)(5) \10\ of the Act which requires NYSE to have rules
that are designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest. The
proposed amendments will move the Rule into conformity with revised
federal regulatory standards and ensure that customers are able to opt
out of the receipt of undesired communications.
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\10\ 15 U.S.C. 78f(b)(5).
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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
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) As the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
a. By order approve the proposed rule change, or
b. Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-NYSE-2007-06 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSE-2007-06. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the
[[Page 14844]]
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 also will be available for
inspection and copying at the principal office of the NYSE. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSE-2007-06 and should be
submitted on or before April 19, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-5816 Filed 3-28-07; 8:45 am]
BILLING CODE 8010-01-P