Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend a Pilot Program That Increases Position and Exercise Limits for Equity Options, 49344-49345 [E5-4585]

Download as PDF 49344 Federal Register / Vol. 70, No. 162 / Tuesday, August 23, 2005 / Notices information with respect to, and facilitating transactions in municipal securities, to remove impediments to and perfect the mechanism of a free and open market in municipal securities, and, in general, to protect investors and the public interest.13 In particular, the Commission finds that the proposed rule change will further investor protection and the public interest by ensuring that solicitations of municipal securities business are undertaken in a manner consistent with standards of fair practice and professionalism, thereby helping to maintain public trust and confidence in the integrity of the municipal securities market. IV. Accelerated Approval of Amendment No. 1 The MSRB requested in Amendment No. 1 that the Commission find good cause, pursuant to Section 19(b)(2) of the Act, for approving Amendment No. 1 (simultaneously with the proposed rule change) prior to the thirtieth day after publication of the notice of filing of Amendment No. 1 in the Federal Register. The Commission finds good cause to approve Amendment No. 1 to the proposal prior to the thirtieth day after the date of publication of notice of filing thereof in the Federal Register. The MSRB believes, and the Commission agrees, that (i) the new effective date and modified transitional payment provisions, as well as the modification to Form G–38t, will facilitate dealer compliance with revised Rule G–38 in an orderly and timely manner while reducing the opportunity for circumvention of the purposes of the proposed rule change, and (ii) the modified definition of ‘‘affiliated person’’ would further minimize the potential burden on competition of the proposed rule change in that it would treat dealer business models using independent brokers equally with dealer business models using directly employed brokers without reducing the effectiveness of the proposed rule change. For these reasons, the Commission finds good cause, consistent with Sections 15B(b)(2)(C) and 19(b)(2) of the Act, to accelerate approval of Amendment No. 1 to the proposed rule change. V. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning Amendment No. 1, including whether Amendment No. 1 is consistent with the Act. Comments 13 Id. VerDate Aug<18>2005 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 rulecomments@sec.gov. Please include File Number SR–MSRB–2005–04 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–MSRB–2005–04. 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 inspection and copying in the Commission’s Public Reference Room. Copies of such filing also will be available for inspection and copying at the MSRB’s offices. All comments received will be posted without change; the Commission does not editpersonal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–MSRB– 2005–04 and should be submitted on or before September 13, 2005. VI. Conclusion For the reasons discussed above, the Commission finds that the proposal is consistent with the Act and the rules and regulations thereunder. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,14 that the proposed rule change (SR–MSRB–2005– 04) be, and hereby is, approved. 14 15 15:03 Aug 22, 2005 Jkt 205001 PO 00000 U.S.C. 78s(b)(2). Frm 00090 Fmt 4703 Sfmt 4703 For the Commission, by the Division of Market Regulation, pursuant to delegated authority.15 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4587 Filed 8–22–05; 8:45 am] BILLING CODE 8010–01–P SECURTITES AND EXCHANGE COMMISSION [Release No. 34–52271; File No. SR–NASD– 2005–097] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend a Pilot Program That Increases Position and Exercise Limits for Equity Options August 16, 2005. 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 August 10, 2005, the National Association of Securities Dealers, Inc. (‘‘NASD’’) 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 NASD. NASD has filed the proposal as a ‘‘noncontroversial’’ rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(6) thereunder,4 which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change NASD proposes to amend NASD Rule 2860 to extend a pilot program increasing certain options position and exercise limits for a pilot period. The text of the proposed rule change is available on NASD’s Web site (http:// www.nasd.com), at NASD’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, NASD included statements concerning 15 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(6). 1 15 E:\FR\FM\23AUN1.SGM 23AUN1 Federal Register / Vol. 70, No. 162 / Tuesday, August 23, 2005 / Notices 49345 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. NASD has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. necessary or appropriate in furtherance of the purposes of the Act, as amended. Comments may be submitted by any of the following methods: 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. Electronic Comments A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the forgoing rule change does not: (1) Significantly affect the protection of investors or the public interest; (2) impose any significant burden on competition; and (3) become operative for 30 days after the date of this filing, 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 A proposed rule change filed under 19b–4(f)(6) normally may not become operative prior to 30 days after the date of filing.10 However, Rule 19b– 4(f)(6)(iii)11 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. NASD has requested that the Commission waive the five-day pre-filing notice requirement and the 30-day preoperative delay. The Commission is exercising its authority to waive the five-day pre-filing requirement and believes that waiver of the 30-day preoperative delay is consistent with the protection of investors and in the public interest. Waiving the five-day pre-filing requirement and 30-day pre-operative delay will allow the Pilot Program to continue uninterrupted.12 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 Act. 1. Purpose NASD is proposing to amend NASD Rule 2860 to extend a pilot program until March 3, 2006 (unless extended) increasing position and exercise limits for both standardized and conventional options (‘‘Pilot Program’’).5 Unless extended, the Pilot Program will expire on September 2, 2005.6 NASD believes that the Pilot Program should be extended so that it may continue without interruption for the same reasons that are discussed in the Pilot Program Notice. 2. Statutory Basis NASD believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,7 which requires, among other things, that NASD’s rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. The proposed rule change is being made so that the Pilot Program, which achieves these goals as discussed in the Pilot Program Notice, may continue without interruption. B. Self-Regulatory Organization’s Statement on Burden on Competition NASD does not believe that the proposed rule change will result in any burden on competition that is not 5 See Securities Exchange Act Release No. 51520 (April 11, 2005), 70 FR 19977 (April 15, 2005) (notice of filing and immediate effectiveness of File No. SR–NASD–2005–040) (‘‘Pilot Program Notice’’). Under the Pilot Program as set forth in NASD Rule 2860(b)(3), standardized and conventional options subject to a position limit of 13,500 contracts were increased during the pilot period to 25,000 contracts; those subject to a position limit of 22,500 contracts were increased to 50,000 contracts; those subject to a position limit of 31,500 contracts were increased to 75,000 contracts; those subject to a position limit of 60,000 contracts were increased to 200,000 contracts; and those subject to a position limit of 75,000 contracts were increased to 250,000 contracts. Options exercise limits, which are set forth in NASD Rule 2860(b)(4), and which incorporate by reference the position limits in NASD Rule 2860(b)(3), were also increased during the Pilot Period. 6 See NASD Rule 2860(b)(3)(A)(i). 7 15 U.S.C. 78o–3(b)(6). VerDate Aug<18>2005 15:03 Aug 22, 2005 Jkt 205001 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. 8 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). 10 17 CFR 240.19b–4(f)(6)(iii). 11 Id. 12 For the purposes only of waiving the operative date of this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 9 17 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File No. SR–NASD–2005–097 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File No. SR–NASD–2005–097. 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 inspection and copying in the Commission’s Public Reference Room, 100 F Street, NE., Washington, DC 20549. Copies of such filing will also be available for inspection and copying at the principal office of NASD. 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 No. SR–NASD–2005–097 and should be submitted on or before September 13, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.13 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4585 Filed 8–22–05; 8:45 am] BILLING CODE 8010–01–P 13 17 E:\FR\FM\23AUN1.SGM CFR 200.30–3(a)(12). 23AUN1

Agencies

[Federal Register Volume 70, Number 162 (Tuesday, August 23, 2005)]
[Notices]
[Pages 49344-49345]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4585]


-----------------------------------------------------------------------

SECURTITES AND EXCHANGE COMMISSION

[Release No. 34-52271; File No. SR-NASD-2005-097]


Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Extend a Pilot Program That Increases Position and 
Exercise Limits for Equity Options

August 16, 2005.
    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 August 10, 2005, the National Association of Securities Dealers, 
Inc. (``NASD'') 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 NASD. NASD has filed the 
proposal as a ``non-controversial'' rule change pursuant to Section 
19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6) thereunder,\4\ which 
renders it effective upon filing with the Commission. The Commission is 
publishing this notice to solicit comments on the proposed rule change 
from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASD proposes to amend NASD Rule 2860 to extend a pilot program 
increasing certain options position and exercise limits for a pilot 
period. The text of the proposed rule change is available on NASD's Web 
site (http://www.nasd.com), at NASD'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, NASD included statements 
concerning

[[Page 49345]]

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. 
NASD 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
    NASD is proposing to amend NASD Rule 2860 to extend a pilot program 
until March 3, 2006 (unless extended) increasing position and exercise 
limits for both standardized and conventional options (``Pilot 
Program'').\5\ Unless extended, the Pilot Program will expire on 
September 2, 2005.\6\ NASD believes that the Pilot Program should be 
extended so that it may continue without interruption for the same 
reasons that are discussed in the Pilot Program Notice.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 51520 (April 11, 
2005), 70 FR 19977 (April 15, 2005) (notice of filing and immediate 
effectiveness of File No. SR-NASD-2005-040) (``Pilot Program 
Notice''). Under the Pilot Program as set forth in NASD Rule 
2860(b)(3), standardized and conventional options subject to a 
position limit of 13,500 contracts were increased during the pilot 
period to 25,000 contracts; those subject to a position limit of 
22,500 contracts were increased to 50,000 contracts; those subject 
to a position limit of 31,500 contracts were increased to 75,000 
contracts; those subject to a position limit of 60,000 contracts 
were increased to 200,000 contracts; and those subject to a position 
limit of 75,000 contracts were increased to 250,000 contracts. 
Options exercise limits, which are set forth in NASD Rule 
2860(b)(4), and which incorporate by reference the position limits 
in NASD Rule 2860(b)(3), were also increased during the Pilot 
Period.
    \6\ See NASD Rule 2860(b)(3)(A)(i).
---------------------------------------------------------------------------

2. Statutory Basis
    NASD believes that the proposed rule change is consistent with the 
provisions of Section 15A(b)(6) of the Act,\7\ which requires, among 
other things, that NASD's rules must be designed to prevent fraudulent 
and manipulative acts and practices, to promote just and equitable 
principles of trade, and, in general, to protect investors and the 
public interest. The proposed rule change is being made so that the 
Pilot Program, which achieves these goals as discussed in the Pilot 
Program Notice, may continue without interruption.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78o-3(b)(6).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    NASD 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.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the forgoing rule change does not: (1) Significantly affect 
the protection of investors or the public interest; (2) impose any 
significant burden on competition; and (3) become operative for 30 days 
after the date of this filing, 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\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under 19b-4(f)(6) normally may not 
become operative prior to 30 days after the date of filing.\10\ 
However, Rule 19b-4(f)(6)(iii)\11\ permits the Commission to designate 
a shorter time if such action is consistent with the protection of 
investors and the public interest. NASD has requested that the 
Commission waive the five-day pre-filing notice requirement and the 30-
day pre-operative delay. The Commission is exercising its authority to 
waive the five-day pre-filing requirement and believes that waiver of 
the 30-day pre-operative delay is consistent with the protection of 
investors and in the public interest. Waiving the five-day pre-filing 
requirement and 30-day pre-operative delay will allow the Pilot Program 
to continue uninterrupted.\12\
---------------------------------------------------------------------------

    \10\ 17 CFR 240.19b-4(f)(6)(iii).
    \11\ Id.
    \12\ For the purposes only of waiving the operative date of this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

    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 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 rule-comments@sec.gov. Please include 
File No. SR-NASD-2005-097 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-9303.
    All submissions should refer to File No. SR-NASD-2005-097. 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 inspection 
and copying in the Commission's Public Reference Room, 100 F Street, 
NE., Washington, DC 20549. Copies of such filing will also be available 
for inspection and copying at the principal office of NASD. 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 No. SR-NASD-2005-097 and should be 
submitted on or before September 13, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-4585 Filed 8-22-05; 8:45 am]
BILLING CODE 8010-01-P