Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Extending the Effective Date of the Uniform Branch Office Definition and Related Interpretive Material and Extending the Transition Deadline for Compliance With Form BR and Form U4 Filing Requirements, 15786-15787 [E6-4528]

Download as PDF 15786 Federal Register / Vol. 71, No. 60 / Wednesday, March 29, 2006 / Notices 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 rulecomments@sec.gov. Please include File Number SR–NASD–2006–026 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53538; File No. SR–NASD– 2006–037] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Extending the Effective Date of the Uniform Branch Office Definition and Related Interpretive Material and Extending the Transition Deadline for Compliance With Form BR and Form U4 Filing Requirements March 22, 2006. hsrobinson on PROD1PC68 with NOTICES 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 14, 2006, the National Association of Securities Dealers, Inc. (‘‘NASD’’) filed All submissions should refer to File with the Securities and Exchange Number NASD–2006–026. This file Commission (‘‘SEC’’ or ‘‘Commission’’) number should be included on the the proposed rule change as described subject line if e-mail is used. To help the in Items I, II, and III below, which Items Commission process and review your have been prepared by NASD. NASD comments more efficiently, please use has designated the proposed rule change only one method. The Commission will as constituting a stated policy, practice, post all comments on the Commission’s or interpretation with respect to the Internet Web site (http://www.sec.gov/ meaning, administration, or rules/sro.shtml). Copies of the enforcement of an existing rule under submission, all subsequent section 19(b)(3)(A)(i) of the Act 3 and amendments, all written statements Rule 19b–4(f)(1) thereunder,4 which with respect to the proposed rule renders the proposal effective upon change that are filed with the filing with the Commission. The Commission, and all written Commission is publishing this notice to solicit comments on the proposed rule communications relating to the change from interested persons. proposed rule change between the Commission and any person, other than I. Self-Regulatory Organization’s those that may be withheld from the Statement of the Terms of Substance of public in accordance with the the Proposed Rule Change provisions of 5 U.S.C. 552, will be NASD is filing with the Commission available for inspection and copying in an extension of the effective date of the Commission’s Public Reference amendments to NASD Rule Room. Copies of the filing also will be 3010(g)(2)(A) which defines the term available for inspection and copying at ‘‘branch office,’’ and related IM–3010–1 the principal offices of NASD. All which provides guidance on factors to comments received will be posted be considered by members when without change; the Commission does conducting internal inspections of not edit personal identifying offices (‘‘Uniform Branch Office information from submissions. You Definition’’), from May 1, 2006 to July should submit only information that 3, 2006.5 Further, NASD is extending you wish to make available publicly. All from May 1, 2006 to July 3, 2006 the submissions should refer to File transition deadline for compliance with Number NASD–2006–026 and should be Form BR (Uniform Branch Office submitted on or before April 19, 2006. Registration Form) and Form U4 (Uniform Application for Securities For the Commission, by the Division of Industry Registration or Transfer) filing Market Regulation, pursuant to delegated authority.12 Nancy M. Morris, Secretary. [FR Doc. E6–4515 Filed 3–28–06; 8:45 am] BILLING CODE 8010–01–P 12 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 15:39 Mar 28, 2006 Jkt 208001 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(i). 4 17 CFR 240.19b–4(f)(1). 5 See Securities Exchange Act Release No. 52403 (September 9, 2005), 70 FR 54782 (September 16, 2005) (SR–NASD–2003–104) (‘‘Uniform Branch Office Definition Approval Order’’). 2 17 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 requirements for firms with branch offices in existence before the close of business on October 14, 2005.6 NASD is not proposing any textual changes to NASD’s rules. 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 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 On September 9, 2005, the SEC approved: (1) amendments to NASD Rule 3010(g)(2) which defines the term ‘‘branch office’’ and (2) the adoption of IM–3010–1 to provide interpretive guidance on factors to be considered by members in conducting internal inspections of offices.7 In the rule filing, NASD stated that the effective date of the Uniform Branch Office Definition would follow deployment of the new branch office registration system on the Central Registration Depository (CRD), and that members would have sufficient time to transition to the new Form BR (Uniform Branch Office Registration Form) and associated filing protocols.8 Following SEC approval of the Uniform Branch Office Definition, NASD announced in a Notice to Members that the effective date of the amendments would be May 1, 2006.9 In addition, on September 30, 2005, the SEC approved the Form BR and conforming and technical changes to Form U4 (Uniform Application for Securities Industry Registration or Transfer) and Form U5 (Uniform Termination Notice for Securities Industry Registration).10 In the rule 6 See Securities Exchange Act Release No. 52544 (September 30, 2005), 70 FR 58764 (October 7, 2005) (SR–NASD–2005–030) (‘‘Form BR Approval Order’’). 7 See Uniform Branch Office Definition Approval Order. 8 See Form BR Approval Order. See also NASD Notice to Members 05–66 (October 2005). 9 See NASD Notice to Members 05–67 (October 2005). 10 See Form BR Approval Order. See also NASD Notice to Members 05–66 (October 2005). E:\FR\FM\29MRN1.SGM 29MRN1 hsrobinson on PROD1PC68 with NOTICES Federal Register / Vol. 71, No. 60 / Wednesday, March 29, 2006 / Notices filing and subsequent Notice to Members, NASD announced May 1, 2006 as the transition deadline for compliance with Form BR and Form U4 filing requirements for firms with branch offices in existence before the close of business on October 14, 2005. Such firms currently have until May 1, 2006 to: (1) Complete and file the ‘‘conversion’’ Form BR for each such branch and (2) with respect to the registered persons employed by such branches, amend all applicable Forms U4 to assign these registered persons to the branch office(s) (or other locations) from which they work.11 Numerous members have requested an extension of the May 1, 2006 deadlines, as the process for transitioning existing and new branch offices into the new centralized branch office registration system on CRD has been more time consuming than originally anticipated. In particular, members with the largest number of associated persons have stated that the process of completing a Form BR for each branch office location, which requires more detailed information on each branch location (both existing and new locations) than previously required under Schedule E to Form BD, has been resource and labor intensive. Such members have expressed concern that, despite the allocation of significant resources to meet the May 1, 2006 deadlines, they do not believe they will be able to complete the necessary Forms BR and Forms U4 linking each associated person to a registered office location by such deadline. As a result, NASD believes this one-time extension of the deadlines to July 3, 2006 of: (1) the effective date of the Uniform Branch Office Definition and (2) the transition deadline for compliance with Form BR and Form U4 filing requirements for firms with branch offices in existence before the close of business on October 14, 2005 will allow for a more orderly transition by members to the new Uniform Branch Office Definition and the new centralized branch office registration system on CRD. NASD is filing the proposed rule change for immediate effectiveness. The proposed rule change will become effective upon the date of this filing, thereby extending to July 3, 2006: (1) the effective date of the Uniform Branch Office Definition and (2) the transition deadline for compliance with Form BR and Form U4 filing requirements for firms with branch offices in existence before the close of business on October 14, 2005. 2. Statutory Basis NASD believes that the proposed rule change is consistent with the provisions of section 15A(b)(6) of the Act,12 which requires, among other things, that NASD rules 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. NASD believes that the extension to July 3, 2006 will allow for a more orderly transition by members to the Uniform Branch Office Definition and the new centralized branch office registration system on CRD. The extension will allow members to comply with the Uniform Branch Office Definition and the new Form BR without unduly burdening members. 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. 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 The foregoing rule change has become effective pursuant to section 19(b)(3)(A) 13 of the Act and paragraph (f) of Rule 19b–4 thereunder,14 in that the proposed rule change constitutes a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule of NASD. 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 rulecomments@sec.gov. Please include File Number SR–NASD–2006–037 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NASD–2006–037. 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 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 Number SR–NASD–2006–037 and should be submitted on or before April 19, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.15 Nancy M. Morris, Secretary. [FR Doc. E6–4528 Filed 3–28–06; 8:45 am] BILLING CODE 8010–01–P 12 15 11 See NASD Notice to Members 05–66 (October 2005). VerDate Aug<31>2005 15:39 Mar 28, 2006 Jkt 208001 U.S.C. 78o–3(b)(6). 13 15 U.S.C. 78s(b)(3)(A). 14 17 CFR 240.19b–4(f). PO 00000 Frm 00097 Fmt 4703 15 17 Sfmt 4703 15787 E:\FR\FM\29MRN1.SGM CFR 200.30–3(a)(12). 29MRN1

Agencies

[Federal Register Volume 71, Number 60 (Wednesday, March 29, 2006)]
[Notices]
[Pages 15786-15787]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-4528]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53538; File No. SR-NASD-2006-037]


Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change Extending the Effective Date of the Uniform Branch 
Office Definition and Related Interpretive Material and Extending the 
Transition Deadline for Compliance With Form BR and Form U4 Filing 
Requirements

March 22, 2006.
    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 14, 2006, the National Association of Securities Dealers, Inc. 
(``NASD'') filed with the Securities and Exchange Commission (``SEC'' 
or ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by NASD. NASD has 
designated the proposed rule change as constituting a stated policy, 
practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule under section 
19(b)(3)(A)(i) of the Act \3\ and Rule 19b-4(f)(1) thereunder,\4\ 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.
---------------------------------------------------------------------------

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

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

    NASD is filing with the Commission an extension of the effective 
date of amendments to NASD Rule 3010(g)(2)(A) which defines the term 
``branch office,'' and related IM-3010-1 which provides guidance on 
factors to be considered by members when conducting internal 
inspections of offices (``Uniform Branch Office Definition''), from May 
1, 2006 to July 3, 2006.\5\ Further, NASD is extending from May 1, 2006 
to July 3, 2006 the transition deadline for compliance with Form BR 
(Uniform Branch Office Registration Form) and Form U4 (Uniform 
Application for Securities Industry Registration or Transfer) filing 
requirements for firms with branch offices in existence before the 
close of business on October 14, 2005.\6\ NASD is not proposing any 
textual changes to NASD's rules.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 52403 (September 9, 
2005), 70 FR 54782 (September 16, 2005) (SR-NASD-2003-104) 
(``Uniform Branch Office Definition Approval Order'').
    \6\ See Securities Exchange Act Release No. 52544 (September 30, 
2005), 70 FR 58764 (October 7, 2005) (SR-NASD-2005-030) (``Form BR 
Approval Order'').
---------------------------------------------------------------------------

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 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
    On September 9, 2005, the SEC approved: (1) amendments to NASD Rule 
3010(g)(2) which defines the term ``branch office'' and (2) the 
adoption of IM-3010-1 to provide interpretive guidance on factors to be 
considered by members in conducting internal inspections of offices.\7\ 
In the rule filing, NASD stated that the effective date of the Uniform 
Branch Office Definition would follow deployment of the new branch 
office registration system on the Central Registration Depository 
(CRD[reg]), and that members would have sufficient time to transition 
to the new Form BR (Uniform Branch Office Registration Form) and 
associated filing protocols.\8\ Following SEC approval of the Uniform 
Branch Office Definition, NASD announced in a Notice to Members that 
the effective date of the amendments would be May 1, 2006.\9\
---------------------------------------------------------------------------

    \7\ See Uniform Branch Office Definition Approval Order.
    \8\ See Form BR Approval Order. See also NASD Notice to Members 
05-66 (October 2005).
    \9\ See NASD Notice to Members 05-67 (October 2005).
---------------------------------------------------------------------------

    In addition, on September 30, 2005, the SEC approved the Form BR 
and conforming and technical changes to Form U4 (Uniform Application 
for Securities Industry Registration or Transfer) and Form U5 (Uniform 
Termination Notice for Securities Industry Registration).\10\ In the 
rule

[[Page 15787]]

filing and subsequent Notice to Members, NASD announced May 1, 2006 as 
the transition deadline for compliance with Form BR and Form U4 filing 
requirements for firms with branch offices in existence before the 
close of business on October 14, 2005. Such firms currently have until 
May 1, 2006 to: (1) Complete and file the ``conversion'' Form BR for 
each such branch and (2) with respect to the registered persons 
employed by such branches, amend all applicable Forms U4 to assign 
these registered persons to the branch office(s) (or other locations) 
from which they work.\11\
---------------------------------------------------------------------------

    \10\ See Form BR Approval Order. See also NASD Notice to Members 
05-66 (October 2005).
    \11\ See NASD Notice to Members 05-66 (October 2005).
---------------------------------------------------------------------------

    Numerous members have requested an extension of the May 1, 2006 
deadlines, as the process for transitioning existing and new branch 
offices into the new centralized branch office registration system on 
CRD has been more time consuming than originally anticipated. In 
particular, members with the largest number of associated persons have 
stated that the process of completing a Form BR for each branch office 
location, which requires more detailed information on each branch 
location (both existing and new locations) than previously required 
under Schedule E to Form BD, has been resource and labor intensive. 
Such members have expressed concern that, despite the allocation of 
significant resources to meet the May 1, 2006 deadlines, they do not 
believe they will be able to complete the necessary Forms BR and Forms 
U4 linking each associated person to a registered office location by 
such deadline. As a result, NASD believes this one-time extension of 
the deadlines to July 3, 2006 of: (1) the effective date of the Uniform 
Branch Office Definition and (2) the transition deadline for compliance 
with Form BR and Form U4 filing requirements for firms with branch 
offices in existence before the close of business on October 14, 2005 
will allow for a more orderly transition by members to the new Uniform 
Branch Office Definition and the new centralized branch office 
registration system on CRD.
    NASD is filing the proposed rule change for immediate 
effectiveness. The proposed rule change will become effective upon the 
date of this filing, thereby extending to July 3, 2006: (1) the 
effective date of the Uniform Branch Office Definition and (2) the 
transition deadline for compliance with Form BR and Form U4 filing 
requirements for firms with branch offices in existence before the 
close of business on October 14, 2005.
2. Statutory Basis
    NASD believes that the proposed rule change is consistent with the 
provisions of section 15A(b)(6) of the Act,\12\ which requires, among 
other things, that NASD rules 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. NASD believes that the extension to July 3, 2006 will 
allow for a more orderly transition by members to the Uniform Branch 
Office Definition and the new centralized branch office registration 
system on CRD. The extension will allow members to comply with the 
Uniform Branch Office Definition and the new Form BR without unduly 
burdening members.
---------------------------------------------------------------------------

    \12\ 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.

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

    The foregoing rule change has become effective pursuant to section 
19(b)(3)(A) \13\ of the Act and paragraph (f) of Rule 19b-4 
thereunder,\14\ in that the proposed rule change constitutes a stated 
policy, practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule of NASD. 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.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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 Number SR-NASD-2006-037 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASD-2006-037. 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 
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 Number 
SR-NASD-2006-037 and should be submitted on or before April 19, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\15\
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Nancy M. Morris,
Secretary.
 [FR Doc. E6-4528 Filed 3-28-06; 8:45 am]
BILLING CODE 8010-01-P