Self-Regulatory Organizations; New York Stock Exchange, Inc.; Order Granting Approval of Proposed Rule Change and Amendment No. 1 Thereto Relating to the Temporary Reallocation of Securities Among Specialists, 49350 [E5-4592]

Download as PDF 49350 Federal Register / Vol. 70, No. 162 / Tuesday, August 23, 2005 / Notices additional required reports. The proposed rule amendment is designed to require CSE broker-dealers to provide the additional reports to the Exchange. Under NYSE Rule 418, the Exchange may at any time require any member or member organization to be audited in accordance with the requirements of Rule 17a–5. The proposed amendment adds NYSE Rule 418.25, which would require member organizations that are CSE broker-dealers to file such supplemental and alternative reports as may be prescribed by the Exchange. A copy of the modified FOCUS report that CSE broker-dealers would have to file with the Exchange under proposed Rule 418.25 is available on the Exchange’s Internet Web site (https:// www.nyse.com). The Commission finds that the NYSE’s proposal to amend Rule 418 is consistent with the requirements of the Act and the rules and regulations under the Act applicable to a national securities exchange.8 In particular, the Commission believes that the proposal is consistent with Section 6(b)(5) of the Act,9 which requires that the rules of the Exchange be designed to prevent fraudulent and manipulative acts, to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market, and, in general, to protect investors and the public interest. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,10 that the proposed rule change (SR–NYSE–2005–19) is approved. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.11 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4580 Filed 8–22–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52274; File No. SR–NYSE– 2005–21] Self-Regulatory Organizations; New York Stock Exchange, Inc.; Order Granting Approval of Proposed Rule Change and Amendment No. 1 Thereto Relating to the Temporary Reallocation of Securities Among Specialists August 16, 2005. On March 11, 2005, the New York Stock Exchange, Inc. (‘‘NYSE’’ or ‘‘Exchange’’), filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend NYSE Rule 103.11 to introduce new procedures regarding the temporary reallocation of securities traded on the Exchange from one specialist organization to another specialist organization. On June 16, 2005, the Exchange filed Amendment No. 1 to the proposed rule change.3 The proposed rule change, as amended, was published for comment in the Federal Register on July 14, 2005.4 The Commission received no comments on the proposal. This order approves the proposed rule change, as amended. After careful consideration, the Commission finds that the proposed rule change is consistent with the requirements of Section 6 of the Act 5 and the rules and regulations thereunder applicable to a national securities exchange.6 In particular, the Commission finds that the proposed rule change is consistent with section 6(b)(5) of the Act,7 which requires, among other things, that the rules of an exchange be designed 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. The Commission notes that the Exchange has determined that the temporary reallocation of a security is most likely to be required for U.S.C. 78s(b)(1). CFR 240.19b–4. 3 In Amendment No. 1, the NYSE provided information concerning the designee of the Chief Regulatory Officer and corrected technical errors in the rule text. 4 See Securities Exchange Act Release No. 51985 (July 7, 2005), 70 FR 40768. 5 15 U.S.C. 78f. 6 In approving this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 7 15 U.S.C. 78f(b)(5). regulatory reasons and has therefore proposed to transfer the responsibility for such decisions from the Chief Executive Officer to the Chief Regulatory Officer (‘‘CRO’’) or his or her designee.8 The Commission also notes that the Exchange has proposed to specify that only non-specialist Board of Executive (‘‘BoE’’) Floor Representatives may join the CRO (or his or her designee) in making reallocation decisions in order to avoid any potential conflicts of interest that may exist with specialist BoE Floor Representatives participating in such decisions. The Commission also notes that the Exchange has provided an alternative that, if there are not two non-specialist BoE Floor Representatives available to participate with the CRO (or his or her designee) in the reallocation decision, the most senior non-specialist Floor Governor or Governors, based on his or her current length of service as a Floor Governor, would be authorized to act in place of the non-specialist BoE Floor Representative or Representatives. The Commission believes that the proposed changes to the Exchange’s procedure for the temporary reallocation of securities are designed to appropriately assign the responsibility for making reallocation decisions to the Exchange’s regulatory group and disinterested members of the BoE (or disinterested Floor Governors), and thereby to minimize the potential for conflicts of interest and strengthen regulatory independence. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,9 that the proposed rule change (SR–NYSE–2005– 21) as amended, is approved. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.10 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–4592 Filed 8–22–05; 8:45 am] BILLING CODE 8010–01–P 1 15 2 17 8 In approving this proposed rule change, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 9 15 U.S.C. 78f(b)(5). 10 15 U.S.C. 78f(b)(2). 11 17 CFR 200.30–3(a)(12). VerDate Aug<18>2005 15:03 Aug 22, 2005 Jkt 205001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 8 The Commission notes that the Exchange has represented that it expects that the designee would be an officer in the Exchange’s regulatory group, with the Executive Vice President of the Market Surveillance Division being the primary designee. See Amendment No. 1. 9 15 U.S.C. 78s(b)(2). 10 17 CFR 200.30–3(a)(12). E:\FR\FM\23AUN1.SGM 23AUN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 70, Number 162 (Tuesday, August 23, 2005)]
[Notices]
[Page 49350]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4592]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52274; File No. SR-NYSE-2005-21]


Self-Regulatory Organizations; New York Stock Exchange, Inc.; 
Order Granting Approval of Proposed Rule Change and Amendment No. 1 
Thereto Relating to the Temporary Reallocation of Securities Among 
Specialists

August 16, 2005.
    On March 11, 2005, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange''), filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to amend NYSE Rule 103.11 to introduce new 
procedures regarding the temporary reallocation of securities traded on 
the Exchange from one specialist organization to another specialist 
organization. On June 16, 2005, the Exchange filed Amendment No. 1 to 
the proposed rule change.\3\ The proposed rule change, as amended, was 
published for comment in the Federal Register on July 14, 2005.\4\ The 
Commission received no comments on the proposal. This order approves 
the proposed rule change, as amended.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, the NYSE provided information concerning 
the designee of the Chief Regulatory Officer and corrected technical 
errors in the rule text.
    \4\ See Securities Exchange Act Release No. 51985 (July 7, 
2005), 70 FR 40768.
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    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of Section 6 of the Act 
\5\ and the rules and regulations thereunder applicable to a national 
securities exchange.\6\ In particular, the Commission finds that the 
proposed rule change is consistent with section 6(b)(5) of the Act,\7\ 
which requires, among other things, that the rules of an exchange be 
designed 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. The Commission notes that the Exchange has determined 
that the temporary reallocation of a security is most likely to be 
required for regulatory reasons and has therefore proposed to transfer 
the responsibility for such decisions from the Chief Executive Officer 
to the Chief Regulatory Officer (``CRO'') or his or her designee.\8\ 
The Commission also notes that the Exchange has proposed to specify 
that only non-specialist Board of Executive (``BoE'') Floor 
Representatives may join the CRO (or his or her designee) in making 
reallocation decisions in order to avoid any potential conflicts of 
interest that may exist with specialist BoE Floor Representatives 
participating in such decisions. The Commission also notes that the 
Exchange has provided an alternative that, if there are not two non-
specialist BoE Floor Representatives available to participate with the 
CRO (or his or her designee) in the reallocation decision, the most 
senior non-specialist Floor Governor or Governors, based on his or her 
current length of service as a Floor Governor, would be authorized to 
act in place of the non-specialist BoE Floor Representative or 
Representatives. The Commission believes that the proposed changes to 
the Exchange's procedure for the temporary reallocation of securities 
are designed to appropriately assign the responsibility for making 
reallocation decisions to the Exchange's regulatory group and 
disinterested members of the BoE (or disinterested Floor Governors), 
and thereby to minimize the potential for conflicts of interest and 
strengthen regulatory independence.
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    \5\ 15 U.S.C. 78f.
    \6\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. See 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78f(b)(5).
    \8\ The Commission notes that the Exchange has represented that 
it expects that the designee would be an officer in the Exchange's 
regulatory group, with the Executive Vice President of the Market 
Surveillance Division being the primary designee. See Amendment No. 
1.
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (SR-NYSE-2005-21) as amended, is 
approved.
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    \9\ 15 U.S.C. 78s(b)(2).
    \10\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-4592 Filed 8-22-05; 8:45 am]
BILLING CODE 8010-01-P

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