[Federal Register Volume 75, Number 66 (Wednesday, April 7, 2010)]
[Notices]
[Pages 17799-17801]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7837]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-61809; File No. SR-NYSEAmex-2010-29]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Amex LLC Amending NYSE
Amex Equities Rule 1 To Provide for the Designation of Qualified
Employees and NYSE Amex Equities Rule 51 To Clarify the Scope of
Authority Vested in the Chief Executive Officer
March 31, 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 March 25, 2010, NYSE Amex LLC (the ``Exchange'' or
``NYSE Amex'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. 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.
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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 NYSE Amex Equities Rule 1 (``The
Exchange'') to provide that the Exchange may formally designate one or
more qualified employees to act in place of any person named in a rule
as having authority to act under such rule if the named person is not
available to administer the rule; and (2) amend
[[Page 17800]]
NYSE Amex Equities Rule 51 (``Hours of Business'') to clarify the scope
of authority vested in the Chief Executive Officer (``CEO'') and to
make several non-substantive stylistic changes to the rule text. The
text of the proposed rule change is available at the Exchange, the
Commission's Public Reference Room, http://www.sec.gov, and http://www.nyse.com.
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 self-regulatory organization
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
Statutory Basis for, the Proposed Rule Change
1. Purpose
NYSE Amex, formerly the American Stock Exchange LLC, proposes to
amend NYSE Amex Equities Rule 1 to provide that the Exchange may
formally designate one or more qualified employees to act in place of
any person named in a rule as having authority to act under such rule
in the event that the named person is not available. The Exchange
believes that providing for such delegations will enable the
administration of NYSE Amex Equities rules in a more efficient manner
in the event the specified individual is unavailable. Separately, the
Exchange proposes to amend NYSE Amex Equities Rule 51 to clarify the
scope of authority vested in the Chief Executive Officer (``CEO'') to
take certain actions when he deems such actions necessary or
appropriate for the maintenance of a fair and orderly market, the
protection of investors or otherwise in the public interest, due to
extraordinary circumstances.
The Exchange notes that parallel changes are proposed to be made to
the rules of the New York Stock Exchange LLC.\4\
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\4\ See SR-NYSE-2010-26.
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NYSE Amex Equities Rule 1
NYSE Amex Equities Rule 1 provides that ``the Exchange'' is defined
as NYSE Amex LLC or the officer, employee, person, entity or committee
to whom appropriate authority to administer such rule has been
delegated by the Exchange.
Additionally, NYSE Amex Equities Rule 1 provides that all
references to the ``Board,'' ``Board of Directors,'' ``Chairman,''
``Chairman of the Board,'' ``Chief Executive Officer'' and ``CEO''
refer to those persons and entities of the Exchange. `NYSE Market'
means NYSE Market, Inc., an indirect wholly owned subsidiary of NYSE
Euronext and `NYSER' refers to NYSE Regulation, Inc, an indirect wholly
owned subsidiary of NYSE Euronext.
Rule 1 further provides that references to `Market Surveillance
Division' or `Division of Market Surveillance' or `Market Surveillance'
or `Regulation & Surveillance' shall be deemed to refer to the Market
Surveillance Division of NYSE Regulation, Inc.
Through this filing, the Exchange proposes to amend NYSE Amex
Equities Rule 1 to include a provision that the CEO or the Chief
Regulatory Officer (``CRO'') of the Exchange may formally designate one
or more qualified employees of NYSE Euronext to act in place of any
person named in a rule as having authority to act under such rule in
the event that the named person is not available to administer the
rule. For purposes of designation by a CEO, a qualified employee is
defined as: (1) Any officer of NYSE Euronext; or (2) any employee of
the Exchange that the Board of Directors deems to possess the requisite
knowledge and job qualifications to administer that rule.\5\
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\5\ Rule 46.10 provides that for purposes of Rule 46 only, the
term ``qualified NYSE Euronext employee'' shall mean ``employees of
NYSE Euronext or any of its subsidiaries, excluding employees of
NYSE Regulation, Inc., who shall have satisfied any applicable
testing or qualification required by the Exchange for all Floor
Governors.'' That definition shall not be applied to any other NYSE
Amex Equities Rule and is separate and distinct from the Rule 1
definition discussed herein.
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Additionally, in certain instances, the Exchange's CRO is one of
the named persons identified to administer particular NYSE Amex
Equities rules. In these situations, a qualified employee of NYSE
Regulation, Inc. (``NYSER'') may serve as the CRO's designee if the CRO
and the Board of Directors of NYSER deem such employee to have the
requisite knowledge and job qualifications to administer the rule in
place of the CRO. All qualified employees of NYSE Euronext shall be
subject to the jurisdictions set forth in Section 7.1 of NYSE
Euronext's Amended and Restated Bylaws.\6\
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\6\ Article VII, Section 7.1 of the Amended and Restated Bylaws
of NYSE Euronext states the following:
Submission to Jurisdiction of U.S. Courts and the SEC. The
Corporation, its directors and officers, and those of its employees
whose principal place of business and residence is outside of the
United States shall be deemed to irrevocably submit to the
jurisdiction of the U.S. Federal courts and the SEC for the purposes
of any suit, action or proceeding pursuant to the U.S. Federal
securities laws and the rules and regulations thereunder, commenced
or initiated by the SEC arising out of, or relating to, the
activities of the U.S. Regulated Subsidiaries (and shall be deemed
to agree that the Corporation may serve as the U.S. agent for
purposes of service of process in such suit, action or proceeding),
and the Corporation and each such director, officer or employee, in
the case of any such director, officer or employee by virtue of his
acceptance of any such position, shall be deemed to waive, and agree
not to assert by way of motion, as a defense or otherwise in any
such suit, action or proceeding, any claims that it or they are not
personally subject to the jurisdiction of the SEC, that such suit,
action or proceeding is an inconvenient forum or that the venue of
such suit, action or proceeding is improper, or that the subject
matter thereof may not be enforced in or by such courts or agency.
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The Exchange believes that it is important that its rules provide
for appropriate delegations of authority to ensure business continuity
and that all rules can be properly administered even if the specified
official is unavailable. The proposed provision applicable to all NYSE
Amex Equities rules will enable consistent delegation standards and
eliminate any potential for confusion that could result because some
rules currently provide for delegation while others do not.
The Exchange has implemented policies and procedures to formally
identify the officers and employee [sic] who have been delegated
authority to administer a particular rule on behalf of any named person
identified in that rule. The Exchange considers the delegation of
authority to be a corporate function; accordingly, such formal
delegation is subject to approval by the CEO, CRO and Boards of
Directors of the Exchange or NYSER, as applicable, as well as
compliance with all applicable Bylaws of the Exchange. These
delegations of authority are centrally maintained and periodically
updated by the Office of General Counsel to remain current with final
approval by the CEO of the Exchange or NYSER as applicable.
NYSE Amex Equities Rule 51
NYSE Amex Equities Rule 51 vests the CEO with the powers to suspend
or halt trading in any security traded on the Exchange, as well as to
close some or all Exchange facilities, if he deems such action to be
necessary or appropriate for the maintenance of a fair and orderly
market, or the protection of investors, or otherwise in the public
interest, due to extraordinary circumstances. ``Extraordinary
circumstances'' are defined in NYSE
[[Page 17801]]
Amex Equities Rule 51 as ``(1) actual or threatened physical danger,
severe climatic conditions, civil unrest, terrorism, acts of war, or
loss or interruption of facilities utilized by the Exchange, (2) a
request by a governmental agency or official, or (3) a period of
mourning or recognition for a person or event.''
The Exchange proposes to amend NYSE Amex Equities Rule 51 to
clarify that the CEO has the authority to extend the hours for the
transaction of business on the Exchange and to set a delayed closing
time if the CEO deems such action to be necessary or appropriate for
the maintenance of a fair and orderly market, or the protection of
investors, or otherwise in the public interest, due to extraordinary
circumstances. The Exchange has interpreted the CEO's authority to halt
securities and determine the length of such halt to include extending
the regular closing, in order to ensure that closing trades in
securities traded on the Exchange are conducted in a manner consistent
with a fair and order market and the protection of investors and the
public interest.\7\ However, in order to provide appropriate
transparency to market participants, the Exchange proposes to clarify
and codify the CEO's authority in this regard.
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\7\ NYSER has previously announced this policy in several
Information Memos that were issued in connection with the Russell
Reconstitution in June 2008 and June 2009. Those memos described
(among other things) the Exchange's various contingency scenarios
and procedures, including extending the closing time in the event
that a systems malfunction occurs at or near the regular 4:00 p.m.
closing time. See NYSE Amex Equities Rule 51; See also IM 08-30 and
IM 09-27. The Exchange has also periodically issued memoranda from
its Floor Operations staff, advising of the same contingency
scenarios and procedures.
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The Exchange also proposes to make several non-substantive changes
to the rule text by amending the rule text in Rule 51(a) to conform
with proposed Rule 51(b)(ii) and by abbreviating references to ``Chief
Executive Officer'' with ``CEO.''
2. Statutory Basis
The basis under the Act for the proposed rule change is the
requirement under Section 6(b)(5),\8\ which requires that an exchange
have rules that are designed 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 rule change is
consistent with these objectives in that these amendments establish the
appropriate Exchange protocols and procedures to administer Exchange
rules designed to protect investors and the public interest.
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\8\ 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 \9\ and Rule 19b-4(f)(6) thereunder.\10\
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 and Rule 19b-
4(f)(6)(iii) thereunder.
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\9\ 15 U.S.C. 78s(b)(3)(A)(iii).
\10\ 17 CFR 240.19b-4(f)(6).
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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-NYSEAmex-2010-29 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-NYSEAmex-2010-29. 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 such 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
publicly available. All submissions should refer to File Number SR-
NYSEAmex-2010-29 and should be submitted on or before April 28, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-7837 Filed 4-6-10; 8:45 am]
BILLING CODE 8011-01-P