[Federal Register Volume 75, Number 50 (Tuesday, March 16, 2010)]
[Notices]
[Pages 12591-12592]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-5660]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-61681; File No. SR-NASDAQ-2010-033]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
to Amend Rule 3121 To Reflect Changes To Corresponding FINRA Rule and a
Clerical Change to NASDAQ's Rules
March 10, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 5, 2010, The NASDAQ Stock Market LLC (the ``Exchange'' or
``NASDAQ'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The Exchange
has designated the proposed rule change as constituting a non-
controversial rule change under Rule 19b-4(f)(6) under the Act,\3\
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\ 17 CFR 240.19b-4.
\3\ 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 is filing this proposed rule change to amend NASDAQ
Rule 3121 to reflect recent changes to a corresponding rule of the
Financial Industry Regulatory Authority (``FINRA''), and to make
clerical corrections to the NASDAQ rulebook. The text of the proposed
rule change is available at http://nasdaqomxbx.cchwallstreet.com, at
the Exchange's principal office, 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, 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
Many of NASDAQ's rules are based on rules of FINRA (formerly the
National Association of Securities Dealers (``NASD'')). During 2008,
FINRA embarked on an extended process of moving rules formerly
designated as ``NASD Rules'' into a consolidated FINRA rulebook. In
most cases, FINRA has renumbered these rules, and in some cases has
substantively amended them. Accordingly, NASDAQ also proposes to
initiate a process of modifying its rulebook to ensure that NASDAQ
rules corresponding to FINRA rules continue to mirror them as closely
as practicable. In some cases, it will not be possible for the rule
numbers of NASDAQ rules to mirror corresponding FINRA rule numbers,
because existing or planned NASDAQ rules make use of those numbers.
However, wherever possible, NASDAQ plans to update its rules to reflect
changes to corresponding FINRA rules.
This filing addresses NASDAQ Rule 3121, which formerly corresponded
to NASD Rule 3121. In SR-FINRA-2009-080,\4\ FINRA redesignated NASD
Rule 3121 as FINRA Rule 4570 with minor technical changes. FINRA Rule
4570 requires a member to designate, as the custodian of its required
books and records on Form BDW, a person who is associated with the firm
at the time Form BDW is filed. The rule is intended to enhance the
SRO's ability to obtain required books and record [sic] from firms that
are no longer conducting business and to ensure that the custodian of
the books and records has been subject to certain background checks.
The FINRA Rule 4570 text makes minor technical changes by adopting
terminology consistent with that used in Form BDW.
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\4\ Securities Exchange Act Release No. 61332 (January 12,
2010), 75 FR 12 [sic] (January 20, 2010) (SR-FINRA-2009-080).
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NASDAQ is adopting the new FINRA rule in full, and redesignating
NASDAQ Rule 3121 to be NASDAQ Rule 4570, so as to correspond to the new
FINRA rule number.
NASDAQ is also proposing to make a clerical correction to the
NASDAQ rulebook. Specifically, NASDAQ proposes to renumber NASDAQ Rule
2310 to NASDAQ Rule 2310A. This change will correct an error in a prior
rule filing,\5\ which inadvertently did not include the intended ``A''
in the rule number and text, resulting in two rules labeled as Rule
2310 in NASDAQ's rulebook.
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\5\ Securities Exchange Act Release No. 61321 (January 8, 2010),
75 FR 14 [sic] (January 22, 2010)(SR-NASDAQ-2010-002).
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\6\ in general, and with
Sections 6(b)(5) of the Act,\7\ in particular, in that the proposal is
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, 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. The proposed
changes will conform NASDAQ Rule 3121 to recent changes made to a
corresponding FINRA rule, to promote application of consistent
regulatory standards. The proposed change to NASDAQ Rule 2310 will
correct a clerical error in the NASDAQ rulebook.
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\6\ 15 U.S.C. 78f.
\7\ 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
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
[[Page 12592]]
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing 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 for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act\8\ and Rule 19b-
4(f)(6) thereunder.\9\
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\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b4(f)(6)(iii),\11\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing.
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\10\ 17 CFR 240.19b-4(f)(6).
\11\ 17 CFR 240.19b-4(f)(6)(iii).
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The Commission has determined that waiving the 30-day operative
delay of the Exchange's proposal is consistent with the protection of
investors and the public interest because such waiver will allow these
changes to be implemented as of the date of filing of the proposed rule
change with the Commission, thereby minimizing any potential
confusion.\12\ Therefore, the Commission designates the proposal as
operative upon filing.
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\12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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-NASDAQ-2010-033 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-NASDAQ-2010-033. 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. Copies of the filing also will
be available for inspection and copying at the principal office of the
Exchange. 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-
NASDAQ-2010-033 and should be submitted on or before April 6, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12). [sic]
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-5660 Filed 3-15-10; 8:45 am]
BILLING CODE 8011-01-P