[Federal Register Volume 75, Number 114 (Tuesday, June 15, 2010)]
[Notices]
[Pages 33868-33869]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-14359]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62247; File No. SR-NYSEArca-2010-43]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Arca, Inc. Amending Rule
5.2(b)(1)
June 9, 2010.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on May 21, 2010, NYSE Arca, Inc. (``NYSE Arca'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have substantially been prepared by NYSE
Arca. The Exchange has designated the proposed rule change as
constituting a ``non-controversial'' rule change under Section
19(b)(3)(A) of the Act,\4\ and Rule 19b-4(f)(6) thereunder,\5\ which
renders the proposal effective upon filing with the Commission. 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.
\3\ 17 CFR 240.19b-4.
\4\ 15 U.S.C. 78s(b)(3)(A).
\5\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 5.2(b)(1)--Notification
Requirements for Offering of Securities to clarify its applicability. A
copy of this filing is available on the Exchange's Web site at http://www.nyse.com, at the Exchange's principal office, on the Commission's
Web site at http://www.sec.gov, and at the Commission's Public
Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NYSE Arca 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 those 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 parts of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of this filing is to clarify the applicability of Rule
5.2(b)(1)--Notification Requirements for Offering of Securities.
Specifically, the Exchange proposes to amend Rule 5.2(b)(1) in order to
make clear that an Equity Trading Permit (``ETP'') Holder, acting as
the lead underwriter for any offering in a security listed on any
national securities exchange, is obligated to notify the Exchange of
the offering, regardless of where the offering is listed. In its
current form, Rule 5.2(b)(1) requires ETP Holders to notify the
Exchange of ``any'' offering when acting as the lead underwriter.
Therefore, the current rule language can be construed to require that
ETP Holders notify the Exchange of all offerings in such circumstances,
including offerings of securities listed on national securities
exchanges other than NYSE Arca. However, the purpose section of the
November 2004 19b-4 rule filing that created Rule 5.2(b)(1) states that
``Rule 5.2(b)(1) would require an [ETP Holder] that participates in any
offering of securities listed on the Exchange to submit certain
information to PCXE regarding the offering (emphasis added).'' \6\ For
the following reasons, the Exchange proposes to add language to Rule
5.2(b)(1) in order to make clear that ETP Holders who act as lead
underwriters in offerings of securities listed on NYSE Arca or any
other national securities exchange must notify the Exchange of such
offerings. First, the language in the November 2004 19b-4 unnecessarily
limits the scope of Rule 5.2(b)(1) to offerings of securities listed on
NYSE Arca. Second, the Exchange regularly receives notices from ETP
Holders of offerings of securities listed on national securities
exchanges other than NYSE Arca and regularly investigates potential
Regulation M violations in connection with such offerings. Finally, the
Exchange depends on ETP Holders to notify it of offerings of securities
listed on NYSE Arca and other national securities exchanges in order to
effectively surveil for and investigate potential violations of
Regulation M in connection with such offerings.\7\
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\6\ Exchange Act Release No. 34-50662 (November 15, 2004), 69 FR
67770 (November 19, 2004) (File No. SR-PCX-2004-102).
\7\ The Exchange cannot investigate offerings of securities that
are not listed on a national securities exchange because the
Exchange's jurisdictional purview does not cover trading activity in
such securities.
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The proposed amendment to Rule 5.2(b)(1) codifies the Exchange's
previously published interpretation of Rule 5.2(b)(1),\8\ and the
Exchange's practice of requiring that ETP Holders who act as lead
underwriters in any offering in a security listed on any national
securities exchange notify the Exchange of such offering. The Exchange
is not otherwise altering the rights or obligations of ETP Holders.
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\8\ See Exchange Regulatory Information Bulletin RBE 07-04 (May
31, 2007).
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\10\ in particular, in that it is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to remove
[[Page 33869]]
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.
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\9\ 15 U.S.C. 78f(b).
\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
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act,\11\ and Rule 19b-4(f)(6) thereunder.\12\
Because the proposed rule change does not: (i) Significantly affect the
protection of investors or the public interest, (ii) impose any
significant burden on competition, and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act \13\ and Rule 19b-
4(f)(6)(iii) thereunder.\14\
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\11\ 15 U.S.C. 78s(b)(3)(A)(iii).
\12\ 17 CFR 240.19b-4(f)(6).
\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the Exchange to give the Commission written
notice of the Exchange's intent to file the proposed rule change
along with a brief description and text of the proposed rule change,
at least five business days prior to the date of filing of the
proposed rule change, or such shorter time as designated by the
Commission. The Exchange has satisfied the pre-filing requirement.
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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.
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-NYSEArca-2010-43 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEArca-2010-43. 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 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 Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street, NE., Washington, DC 20549, on official business days between
the hours of 10 a.m. and 3 p.m. Copies of the filing will also be
available for inspection and copying at NYSE Arca's principal office
and on its Internet Web site at http://www.nyse.com. 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-NYSEArca-2010-43 and should
be submitted on or before July 6, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-14359 Filed 6-14-10; 8:45 am]
BILLING CODE 8010-01-P