[Federal Register Volume 76, Number 63 (Friday, April 1, 2011)]
[Notices]
[Pages 18283-18285]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-7651]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64130; File No. SR-NYSEAmex-2011-17]
Self-Regulatory Organizations; NYSE Amex LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Deleting Rule 346--
NYSE Amex Equities and Adopting New Rule 3270--NYSE Amex Equities To
Correspond With Rule Changes Filed by the Financial Industry Regulatory
Authority, Inc.
March 28, 2011.
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 14, 2011, NYSE Amex LLC (the ``SRO'' or ``NYSE
Amex'') 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 been substantially prepared by the SRO.
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 SRO proposes to delete Rule 346--NYSE Amex Equities and adopt
new Rule 3270--NYSE Amex Equities to correspond with rule changes filed
by the Financial Industry Regulatory Authority, Inc. (``FINRA'') and
approved by the Securities and Exchange
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Commission (the ``Commission'').\4\ The text of the proposed rule
change is available at the NYSE Amex, at the Commission's Public
Reference Room, and on NYSE Amex's Web site at http://www.nyse.com.
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\4\ See Securities Exchange Act Release No. 62762 (August 23,
2010), 75 FR 53362 (August 31, 2010) (approval order).
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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 Amex 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 SRO 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
The purpose of the proposed rule change, to delete Rule 346--NYSE
Amex Equities (Limitations--Employment and Association with Members and
Member Organizations) and adopt new Rule 3270--NYSE Amex Equities
(Outside Business Activities of Registered Persons), is to correspond
with rule changes filed by FINRA and approved by the Commission.
Background
On July 30, 2007, FINRA's predecessors, the National Association of
Securities Dealers, Inc. (``NASD'') and NYSE Regulation, Inc.
(``NYSER''), consolidated their member firm regulation operations into
a combined organization, FINRA. Pursuant to Rule 17d-2 under the
Securities Exchange Act of 1934, as amended (the ``Act''), the New York
Stock Exchange LLC (``NYSE''), NYSER and FINRA entered into an
agreement (the ``Agreement'') to reduce regulatory duplication for
their members by allocating to FINRA certain regulatory
responsibilities for certain NYSE rules and rule interpretations
(``FINRA Incorporated NYSE Rules''). The SRO became a party to the
Agreement effective December 15, 2008.\5\
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\5\ See Securities Exchange Act Release Nos. 56148 (July 26,
2007), 72 FR 42146 (August 1, 2007) (order approving the Agreement);
56147 (July 26, 2007), 72 FR 42166 (August 1, 2007) (SR-NASD-2007-
054) (order approving the incorporation of certain NYSE Rules as
``Common Rules''); and 60409 (July 30, 2009), 74 FR 39353 (August 6,
2009) (order approving the amended and restated Agreement, adding
NYSE Amex LLC as a party). Paragraph 2(b) of the Agreement sets
forth procedures regarding proposed changes by FINRA, NYSE or NYSE
Amex to the substance of any of the Common Rules.
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As part of its effort to reduce regulatory duplication and relieve
firms that are members of FINRA, NYSE and NYSE Amex of conflicting or
unnecessary regulatory burdens, FINRA is now engaged in the process of
reviewing and amending the NASD and FINRA Incorporated NYSE Rules in
order to create a consolidated FINRA rulebook.\6\
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\6\ FINRA's rulebook currently has three sets of rules: (1) NASD
Rules, (2) FINRA Incorporated NYSE Rules, and (3) consolidated FINRA
Rules. The FINRA Incorporated NYSE Rules apply only to those members
of FINRA that are also members of the NYSE (``Dual Members''), while
the consolidated FINRA Rules apply to all FINRA members. For more
information about the FINRA rulebook consolidation process, see
FINRA Information Notice, March 12, 2008.
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Proposed Conforming Amendments to NYSE Amex Equities Rules
FINRA adopted NASD Rule 3030 (Outside Business Activities of an
Associated Person), which prohibits any registered person from being
employed by or accepting any compensation from any person as a result
of any outside business activity, other than passive investments,
unless he has provided prompt written notice to his member firm, as
consolidated FINRA Rule 3270 requires, subject to certain
modifications. FINRA also deleted Incorporated NYSE Rule 346 as it is
substantially similar to consolidated FINRA Rule 3270.\7\
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\7\ See fn. 4.
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To harmonize the NYSE Amex Equities Rules with the approved
consolidated FINRA Rules, the SRO correspondingly proposes to delete
Rule 346--NYSE Amex Equities and replace it with proposed Rule 3270--
NYSE Amex Equities, which is substantially similar to the new FINRA
Rule.\8\ As proposed, Rule 3270--NYSE Amex Equities adopts the same
language as FINRA Rule 3270, except for substituting for or adding to,
as needed, the term ``member organization'' for the term ``member,''
and making corresponding technical changes.
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\8\ The NYSE has submitted a companion rule filing amending its
rules in accordance with FINRA's rule changes. See SR-NYSE-2011-12.
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2. Statutory Basis
The SRO believes that the proposed rule changes are consistent with
the provisions of Section 6(b) of the Act,\9\ in general, and further
the objectives of Section 6(b)(5) of the Act,\10\ in particular, in
that they 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
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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The SRO believes that the proposed rule changes support the
objectives of the Act by providing greater harmonization between NYSE
Amex Equities Rules and FINRA Rules (including Common Rules) of similar
purpose, resulting in less burdensome and more efficient regulatory
compliance for Dual Members. To the extent the SRO has proposed changes
that differ from the FINRA version of the Rules, such changes are
technical in nature and do not change the substance of the proposed
NYSE Amex Equities Rules.
B. Self-Regulatory Organization's Statement on Burden on Competition
The SRO 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, as amended.
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 by the SRO with
respect to the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The SRO 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 and Rule 19b-
4(f)(6)(iii) thereunder.
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\11\ 15 U.S.C. 78s(b)(3)(A)(iii).
\12\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \13\ normally
does not
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become operative prior to 30 days after the date of the filing.
However, pursuant to Rule 19b-4(f)(6)(iii),\14\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The SRO 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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\13\ 17 CFR 240.19b-4(f)(6).
\14\ 17 CFR 240.19b-4(f)(6)(iii).
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The SRO believes that this filing is non-controversial because it
raises no novel issues and is consistent with the FINRA rule filing
previously approved by the Commission on which it is based.\15\ In
particular, the purpose of the proposed rule changes is to conform the
NYSE Amex Equities Rules to FINRA's adoption of consolidated FINRA Rule
3270 in furtherance of the consolidation of the member firm regulation
functions of NYSER and FINRA. Except as specifically noted, and subject
to such technical changes as are necessary to apply the Rule to the
SRO, NYSE Amex proposes to adopt the rule changes in the form that they
were approved by the Commission for FINRA. Accordingly, the SRO
believes that these rule changes are eligible for immediately effective
treatment under the Commission's current procedures for processing rule
filings.\16\ The SRO requested an accelerated operative date for the
proposed rule changes in order to avoid regulatory gaps between the
FINRA and NYSE Amex Equity Rules and to further ensure that, as
applicable, the NYSE Amex Equity Rules maintain their status as Common
Rules under the Agreement.\17\ The Commission believes it is consistent
with the protection of investors and the public interest to waive the
30-day operative delay for this reason, and hereby grants such a
waiver.\18\
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\15\ See fn. 4.
\16\ See Securities Exchange Act Release No. 58092 (July 3,
2008), 73 FR 40143 (July 11, 2008) (concerning 17 CFR 200 and 241).
\17\ As provided in paragraph 2(b) of the Agreement, FINRA and
NYSE will amend the list of Common Rules to conform to the rule
changes proposed herein. See fn. 5.
\18\ For purposes of waiving the 30-day operative delay, the
Commission has considered the proposed rule change's impact on
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend 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-2011-17 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-2011-17. 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 Section, 100
F Street, NE., Washington, DC 20549-1090. Copies of the filing will
also be available for inspection and copying at the NYSE'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-NYSEAmex-2011-17 and should
be submitted on or before April 22, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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\19\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-7651 Filed 3-31-11; 8:45 am]
BILLING CODE 8011-01-P