Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Revisions to the Series 55 Examination Program, 44745-44747 [E6-12704]
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Federal Register / Vol. 71, No. 151 / Monday, August 7, 2006 / Notices
2. Statutory Basis
Electronic Comments
NASD believes that the proposed
revisions to the Series 39 examination
program are consistent with the
provisions of Sections 15A(b)(6) 11 and
15A(g)(3) of the Act,12 which authorize
NASD to prescribe standards of training,
experience, and competence for persons
associated with NASD members.
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–NASD–2006–085 on the subject
line.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Paper Comments
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.
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
44745
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54245; File No. SR–NASD–
2006–086]
Self-Regulatory Organizations;
National Association of Securities
Dealers, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to Revisions to
the Series 55 Examination Program
July 31, 2006.
sroberts on PROD1PC70 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 July 14,
2006, the National Association of
All submissions should refer to File
Securities Dealers, Inc. (‘‘NASD’’) filed
Number SR–NASD–2006–085. This file
C. Self-Regulatory Organization’s
with the Securities and Exchange
Statement on Comments on the
number should be included on the
Proposed Rule Change Received From
subject line if e-mail is used. To help the Commission (‘‘Commission’’) the
proposed rule change as described in
Members, Participants or Others
Commission process and review your
Items I, II and III below, which Items
comments more efficiently, please use
Written comments were neither
only one method. The Commission will have been prepared by NASD. NASD
solicited nor received.
post all comments on the Commission’s has designated the proposed rule change
as constituting a stated policy, practice,
III. Date of Effectiveness of the
Internet Web site (https://www.sec.gov/
or interpretation with respect to the
Proposed Rule Change and Timing for
rules/sro.shtml). Copies of the
meaning, administration, or
Commission Action
submission, all subsequent
enforcement of an existing rule of the
The proposed rule change has become amendments, all written statements
self-regulatory organization pursuant to
with respect to the proposed rule
effective pursuant to Section
Section 19(b)(3)(A)(i) of the Act 3 and
19(b)(3)(A)(i) of the Act 13 and Rule 19b– change that are filed with the
Rule 19b–4(f)(1) thereunder,4 which
Commission, and all written
4(f)(1) thereunder,14 in that the
renders the proposal effective upon
communications relating to the
proposed rule change constitutes a
receipt of this filing by the Commission.
stated policy, practice, or interpretation proposed rule change between the
The Commission is publishing this
Commission and any person, other than notice to solicit comments on the
with respect to the meaning,
those that may be withheld from the
administration, or enforcement of an
proposed rule change from interested
public in accordance with the
existing rule of the self-regulatory
persons.
provisions of 5 U.S.C. 552, will be
organization. NASD proposes to
I. Self-Regulatory Organization’s
implement the revised Series 39
available for inspection and copying in
Statement of the Terms of Substance of
examination program on August 15,
the Commission’s Public Reference
the Proposed Rule Change
2006. NASD will announce the
Room. Copies of such filing also will be
NASD is filing revisions to the study
implementation date in a Notice to
available for inspection and copying at
outline and selection specifications for
Members to be published on the same
the principal office of NASD. All
the Limited Representative—Equity
date as this filing.
comments received will be posted
Trader (Series 55) examination
At any time within 60 days of the
without change; the Commission does
program.5 The proposed revisions
filing of such proposed rule change, the not edit personal identifying
update the material to reflect changes to
Commission may summarily abrogate
information from submissions. You
the laws, rules and regulations covered
such rule change if it appears to the
should submit only information that
by the examination and to better reflect
Commission that such action is
you wish to make available publicly. All
the duties and responsibilities of an
necessary or appropriate in the public
submissions should refer to File
equity trader representative. NASD is
interest, for the protection of investors,
Number SR–NASD–2006–085 and
not proposing any textual changes to the
or otherwise in furtherance of the
should be submitted on or before
purposes of the Act.
August 28, 2006.
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
IV. Solicitation of Comments
For the Commission, by the Division of
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:
U.S.C. 78o–3(b)(6).
U.S.C. 78o–3(g)(3).
13 15 U.S.C. 78s(b)(3)(A)(i).
14 17 CFR 240.19b–4(f)(1).
Market Regulation, pursuant to delegated
authority.15
Nancy M. Morris
Secretary.
[FR Doc. E6–12688 Filed 8–4–06; 8:45 am]
BILLING CODE 8010–01–P
11 15
12 15
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CFR 200.30–3(a)(12).
Frm 00141
Fmt 4703
Sfmt 4703
3 15
U.S.C. 78s(b)(3)(A)(i).
CFR 240.19b–4(f)(1).
5 NASD also is proposing corresponding revisions
to the Series 55 question bank, but based upon
instruction from the Commission staff, NASD is
submitting SR–NASD–2006–086 for immediate
effectiveness pursuant to Section 19(b)(3)(A) of the
Act and Rule 19b–4(f)(1) thereunder, and is not
filing the question bank for Commission review. See
letter to Alden S. Adkins, Senior Vice President and
General Counsel, NASD Regulation, from Belinda
Blaine, Associate Director, Division of Market
Regulation (‘‘Division’’), Commission, dated July
24, 2000. The question bank is available for
Commission review.
4 17
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44746
Federal Register / Vol. 71, No. 151 / Monday, August 7, 2006 / Notices
By-Laws, Schedules to the By-Laws, or
Rules of NASD.
The revised study outline is available
on NASD’s Web site (www.nasd.com), at
NASD, and at the Commission.6 The
Series 55 selection specifications have
been submitted to the Commission
under separate cover with a request for
confidential treatment pursuant to Rule
24b–2 under the Act.7
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.
sroberts on PROD1PC70 with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Section 15A(g)(3) of the Act 8 requires
NASD to prescribe standards of training,
experience, and competence for persons
associated with NASD members. In
accordance with that provision, NASD
has developed examinations, and
administers examinations developed by
other self-regulatory organizations, that
are designed to establish that persons
associated with NASD members have
attained specified levels of competence
and knowledge. NASD periodically
reviews the content of the examinations
to determine whether revisions are
necessary or appropriate in view of
changes pertaining to the subject matter
covered by the examinations.
Pursuant to NASD Rule 1032(f), the
Series 55 examination is required, with
certain limited exceptions, for
associated persons who are engaged in
or directly supervise proprietary trading
or the execution of transactions on an
agency basis with respect to transactions
in equity, preferred or convertible debt
securities effected otherwise than on a
securities exchange. There is an
exception from the Series 55
examination requirement for any person
associated with a member whose trading
activities are conducted principally on
6 Telephone conversation between Mia Zur,
Special Counsel, Division, Commission, and Afshin
Atabaki, Counsel, NASD, dated July 19, 2006.
7 17 CFR 240.2–b–2.
8 15 U.S.C. 78o-3(g)(3).
VerDate Aug<31>2005
17:19 Aug 04, 2006
Jkt 208001
behalf of an investment company that is
registered with the Commission
pursuant to the Investment Company
Act of 1940 and that controls, is
controlled by, or is under common
control with the member.
A committee of industry
representatives, together with NASD
staff, recently undertook a review of the
Series 55 examination program. As a
result of this review, NASD is proposing
to make the following revisions to the
study outline to reflect changes to the
laws, rules and regulations covered by
the examination and to better reflect the
duties and responsibilities of an equity
trader representative. NASD is
proposing to add a section on Rules 600
(NMS Security Designation and
Definitions),9 602 (Dissemination of
Quotations in NMS Securities),10 604
(Display of Customer Limit Orders),11
605 (Disclosure of Order Execution
Information),12 606 (Disclosure of Order
Routing Information) 13 and 612
(Minimum Price Increments) 14 of SEC
Regulation NMS. NASD also is
proposing to add sections on NASD
Rules 2111 (Trading Ahead of Customer
Market Orders) and 3380 (Order Entry
and Execution Practices). NASD further
is proposing to modify the section on
the NASDAQ Market Center—Execution
Services to add specific references to
NASD Rules 4701(Definitions), 4704
(Opening Process for NASDAQ-Listed
Securities), 4706 (Order Entry
Parameters), 4707 (Entry and Display of
Quotes/Orders), 4709 (NASDAQ Closing
Cross), 4710 (Participant Obligations in
the NASDAQ Market Center), 4714
(Routing NASDAQ-Listed Securities),
4715 (Adjustment of Open Quotes and/
or Orders) and 4719 (Anonymity).
NASD is proposing to add a section
on the NASDAQ Initial Public Offering
Process (NASDAQ Head Trader Alert
2005–096) and to modify the section on
SEC Regulation SHO to add specific
references to Rules 200 (Definition of
‘‘Short Sale’’ and Marking
Requirements) 15 and 203 (Borrowing
and Delivery Requirements).16 Further,
NASD is proposing to add references to
the specific types of NASDAQ securities
covered by the Series 55 examination,
add two additional modifiers (.ST (PreOpen and Aftermarket Trades Not
Reported Within 90 Seconds) and .W
(Stop Orders)) to the list of Trade
CFR 242.600.
CFR 242.602.
11 17 CFR 242.604.
12 17 CFR 242.605.
13 17 CFR 242.606.
14 17 CFR 242.612.
15 17 CFR 242.200.
16 17 CFR 242.203.
Reporting Service modifiers and add a
section on reporting cancelled trades.
In addition, NASD is proposing to
revise the study outline to remove the
following sections: SEC Rules 11Ac1–1
(formerly Dissemination of
Quotations),17 11Ac1–4 (formerly
Display of Customer Limit Orders),18
11Ac1–5 (formerly Disclosure of Order
Execution Information) 19 and 11Ac1–6
(formerly Disclosure of Order Routing
Information);20 NASDAQ Levels 1, 2
and 3 Service; SEC Rule 10b–10
(Confirmation of Transactions);21 and
NASD Rules 3360 (Short Interest
Reporting), 3370 (Purchases) and 4643
(Customer Confirmations).
As a result of the revisions discussed
above, the number of questions on each
section of the study outline were
modified as follows: NASDAQ and
Over-The-Counter Markets, decreased
from 42 to 41 questions; NASDAQ
Display, Execution and Trading
Systems, increased from 15 to 17
questions; Trade Reporting
Requirements, increased from 16 to 19
questions; and General Industry
Standards, decreased from 27 to 23
questions.
NASD is proposing these changes to
the entire content of the Series 55
examination, including the selection
specifications and question bank. The
number of questions on the Series 55
examination will remain at 100, and
candidates will continue to have 3
hours to complete the exam. Also, each
question will continue to count one
point, and each candidate must
correctly answer 70 percent of the
questions to receive a passing grade.
2. Statutory Basis
NASD believes that the proposed
revisions to the Series 55 examination
program are consistent with the
provisions of Sections 15A(b)(6) 22 and
15A(g)(3) of the Act,23 which authorize
NASD to prescribe standards of training,
experience, and competence for persons
associated with NASD 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.
9 17
10 17
PO 00000
Frm 00142
Fmt 4703
17 17
CFR 240.11Ac1–1.
CFR 240.11Ac1–4.
19 17 CFR 240.11Ac1–5.
20 17 CFR 240.11Ac1–6.
21 17 CFR 240.10b–10.
22 15 U.S.C. 78o–3(b)(6).
23 15 U.S.C. 78o–3(g)(3).
18 17
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Federal Register / Vol. 71, No. 151 / Monday, August 7, 2006 / Notices
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
III. Date of Effectiveness of the
change that are filed with the
Proposed Rule Change and Timing for
Commission, and all written
Commission Action
communications relating to the
The proposed rule change has become proposed rule change between the
Commission and any person, other than
effective pursuant to Section
19(b)(3)(A)(i) of the Act 24 and Rule 19b– those that may be withheld from the
public in accordance with the
4(f)(1) thereunder,25 in that the
provisions of 5 U.S.C. 552, will be
proposed rule change constitutes a
stated policy, practice, or interpretation available for inspection and copying in
the Commission’s Public Reference
with respect to the meaning,
Room. Copies of such filing also will be
administration, or enforcement of an
available for inspection and copying at
existing rule of the self-regulatory
the principal office of NASD. All
organization. NASD proposes to
comments received will be posted
implement the revised Series 55
without change; the Commission does
examination program on August 15,
not edit personal identifying
2006. NASD will announce the
information from submissions. You
implementation date in a Notice to
should submit only information that
Members to be published on the same
you wish to make available publicly. All
date as this filing.
submissions should refer to File
At any time within 60 days of the
filing of such proposed rule change, the Number SR–NASD–2006–086 and
should be submitted on or before
Commission may summarily abrogate
August 28, 2006.
such rule change if it appears to the
Commission that such action is
For the Commission, by the Division of
Market Regulation, pursuant to delegated
necessary or appropriate in the public
authority.26
interest, for the protection of investors,
Nancy M. Morris,
or otherwise in furtherance of the
purposes of the Act.
Secretary.
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.
[FR Doc. E6–12704 Filed 8–4–06; 8:45 am]
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–NASD–2006–086 on the subject
line.
sroberts on PROD1PC70 with NOTICES
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:
Self-Regulatory Organizations;
National Association of Securities
Dealers, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to NASD Rule
5110 and Certain Other NASD Rules
Amended Pursuant to SR–NASD–
2005–087
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NASD–2006–086. 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
August 1, 2006.
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54256; File No. SR–NASD–
2006–087]
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 July 20,
2006, 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, II, and III below, which Items
have been prepared by the NASD. The
26 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
24 15
U.S.C. 78s(b)(3)(A)(i).
25 17 CFR 240.19b–4(f)(1).
VerDate Aug<31>2005
17:19 Aug 04, 2006
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44747
NASD filed the proposed rules change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6) thereunder,4
which renders the proposed rule change
effective upon filing with the
Commission. NASD proposes to make
the proposed rule change operative on
the date on which the Nasdaq Stock
Market LLC (‘‘Nasdaq Exchange’’)
commences operation as a national
securities exchange for Nasdaq-listed
securities.5 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
The NASD proposes to (1) amend
NASD Rule 5110 to clarify that the rule
is applicable to both Nasdaq and nonNasdaq exchange-listed securities; and
(2) make technical, non-substantive
changes to certain other NASD rules
that were amended by proposed rule
change SR–NASD–2005–087.6 Rule
5110 and the other amendments to
NASD rules proposed by SR–NASD–
2005–087 will become effective on the
date upon which the Nasdaq Exchange
operates as a national securities
exchange for Nasdaq-listed securities.
Currently, that date is projected to be
August 1, 2006. The text of the proposed
rule change is available on the NASD’s
Web site (https://www.nasd.com), at
NASD’s principal office, 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, the
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. The NASD has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
3 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
5 These securities will not include approximately
40 securities that are dually-listed on the New York
Stock Exchange.
6 The NASD filed SR–NASD–2005–087 on July
11, 2005 and Amendment No. 1 on June 15, 2006.
The Commission approved SR–NASD–2005–087, as
amended, on June 30, 2006. See Securities
Exchange Act Release No. 54084 (June 30, 2006), 71
FR 38935 (July 10, 2006) (‘‘June 30 Approval
Order’’).
4 17
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]]>Agencies
[Federal Register Volume 71, Number 151 (Monday, August 7, 2006)]
[Notices]
[Pages 44745-44747]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-12704]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54245; File No. SR-NASD-2006-086]
Self-Regulatory Organizations; National Association of Securities
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Relating to Revisions to the Series 55 Examination Program
July 31, 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 July 14, 2006, 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, 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 of the self-
regulatory organization pursuant to Section 19(b)(3)(A)(i) of the Act
\3\ and Rule 19b-4(f)(1) thereunder,\4\ which renders the proposal
effective upon receipt of this filing by 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 is filing revisions to the study outline and selection
specifications for the Limited Representative--Equity Trader (Series
55) examination program.\5\ The proposed revisions update the material
to reflect changes to the laws, rules and regulations covered by the
examination and to better reflect the duties and responsibilities of an
equity trader representative. NASD is not proposing any textual changes
to the
[[Page 44746]]
By-Laws, Schedules to the By-Laws, or Rules of NASD.
---------------------------------------------------------------------------
\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).
\5\ NASD also is proposing corresponding revisions to the Series
55 question bank, but based upon instruction from the Commission
staff, NASD is submitting SR-NASD-2006-086 for immediate
effectiveness pursuant to Section 19(b)(3)(A) of the Act and Rule
19b-4(f)(1) thereunder, and is not filing the question bank for
Commission review. See letter to Alden S. Adkins, Senior Vice
President and General Counsel, NASD Regulation, from Belinda Blaine,
Associate Director, Division of Market Regulation (``Division''),
Commission, dated July 24, 2000. The question bank is available for
Commission review.
---------------------------------------------------------------------------
The revised study outline is available on NASD's Web site
(www.nasd.com), at NASD, and at the Commission.\6\ The Series 55
selection specifications have been submitted to the Commission under
separate cover with a request for confidential treatment pursuant to
Rule 24b-2 under the Act.\7\
---------------------------------------------------------------------------
\6\ Telephone conversation between Mia Zur, Special Counsel,
Division, Commission, and Afshin Atabaki, Counsel, NASD, dated July
19, 2006.
\7\ 17 CFR 240.2-b-2.
---------------------------------------------------------------------------
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
Section 15A(g)(3) of the Act \8\ requires NASD to prescribe
standards of training, experience, and competence for persons
associated with NASD members. In accordance with that provision, NASD
has developed examinations, and administers examinations developed by
other self-regulatory organizations, that are designed to establish
that persons associated with NASD members have attained specified
levels of competence and knowledge. NASD periodically reviews the
content of the examinations to determine whether revisions are
necessary or appropriate in view of changes pertaining to the subject
matter covered by the examinations.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78o-3(g)(3).
---------------------------------------------------------------------------
Pursuant to NASD Rule 1032(f), the Series 55 examination is
required, with certain limited exceptions, for associated persons who
are engaged in or directly supervise proprietary trading or the
execution of transactions on an agency basis with respect to
transactions in equity, preferred or convertible debt securities
effected otherwise than on a securities exchange. There is an exception
from the Series 55 examination requirement for any person associated
with a member whose trading activities are conducted principally on
behalf of an investment company that is registered with the Commission
pursuant to the Investment Company Act of 1940 and that controls, is
controlled by, or is under common control with the member.
A committee of industry representatives, together with NASD staff,
recently undertook a review of the Series 55 examination program. As a
result of this review, NASD is proposing to make the following
revisions to the study outline to reflect changes to the laws, rules
and regulations covered by the examination and to better reflect the
duties and responsibilities of an equity trader representative. NASD is
proposing to add a section on Rules 600 (NMS Security Designation and
Definitions),\9\ 602 (Dissemination of Quotations in NMS
Securities),\10\ 604 (Display of Customer Limit Orders),\11\ 605
(Disclosure of Order Execution Information),\12\ 606 (Disclosure of
Order Routing Information) \13\ and 612 (Minimum Price Increments) \14\
of SEC Regulation NMS. NASD also is proposing to add sections on NASD
Rules 2111 (Trading Ahead of Customer Market Orders) and 3380 (Order
Entry and Execution Practices). NASD further is proposing to modify the
section on the NASDAQ Market Center--Execution Services to add specific
references to NASD Rules 4701(Definitions), 4704 (Opening Process for
NASDAQ-Listed Securities), 4706 (Order Entry Parameters), 4707 (Entry
and Display of Quotes/Orders), 4709 (NASDAQ Closing Cross), 4710
(Participant Obligations in the NASDAQ Market Center), 4714 (Routing
NASDAQ-Listed Securities), 4715 (Adjustment of Open Quotes and/or
Orders) and 4719 (Anonymity).
---------------------------------------------------------------------------
\9\ 17 CFR 242.600.
\10\ 17 CFR 242.602.
\11\ 17 CFR 242.604.
\12\ 17 CFR 242.605.
\13\ 17 CFR 242.606.
\14\ 17 CFR 242.612.
---------------------------------------------------------------------------
NASD is proposing to add a section on the NASDAQ Initial Public
Offering Process (NASDAQ Head Trader Alert 2005-096) and to modify the
section on SEC Regulation SHO to add specific references to Rules 200
(Definition of ``Short Sale'' and Marking Requirements) \15\ and 203
(Borrowing and Delivery Requirements).\16\ Further, NASD is proposing
to add references to the specific types of NASDAQ securities covered by
the Series 55 examination, add two additional modifiers (.ST (Pre-Open
and Aftermarket Trades Not Reported Within 90 Seconds) and .W (Stop
Orders)) to the list of Trade Reporting Service modifiers and add a
section on reporting cancelled trades.
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\15\ 17 CFR 242.200.
\16\ 17 CFR 242.203.
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In addition, NASD is proposing to revise the study outline to
remove the following sections: SEC Rules 11Ac1-1 (formerly
Dissemination of Quotations),\17\ 11Ac1-4 (formerly Display of Customer
Limit Orders),\18\ 11Ac1-5 (formerly Disclosure of Order Execution
Information) \19\ and 11Ac1-6 (formerly Disclosure of Order Routing
Information);\20\ NASDAQ Levels 1, 2 and 3 Service; SEC Rule 10b-10
(Confirmation of Transactions);\21\ and NASD Rules 3360 (Short Interest
Reporting), 3370 (Purchases) and 4643 (Customer Confirmations).
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\17\ 17 CFR 240.11Ac1-1.
\18\ 17 CFR 240.11Ac1-4.
\19\ 17 CFR 240.11Ac1-5.
\20\ 17 CFR 240.11Ac1-6.
\21\ 17 CFR 240.10b-10.
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As a result of the revisions discussed above, the number of
questions on each section of the study outline were modified as
follows: NASDAQ and Over-The-Counter Markets, decreased from 42 to 41
questions; NASDAQ Display, Execution and Trading Systems, increased
from 15 to 17 questions; Trade Reporting Requirements, increased from
16 to 19 questions; and General Industry Standards, decreased from 27
to 23 questions.
NASD is proposing these changes to the entire content of the Series
55 examination, including the selection specifications and question
bank. The number of questions on the Series 55 examination will remain
at 100, and candidates will continue to have 3 hours to complete the
exam. Also, each question will continue to count one point, and each
candidate must correctly answer 70 percent of the questions to receive
a passing grade.
2. Statutory Basis
NASD believes that the proposed revisions to the Series 55
examination program are consistent with the provisions of Sections
15A(b)(6) \22\ and 15A(g)(3) of the Act,\23\ which authorize NASD to
prescribe standards of training, experience, and competence for persons
associated with NASD members.
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\22\ 15 U.S.C. 78o-3(b)(6).
\23\ 15 U.S.C. 78o-3(g)(3).
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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.
[[Page 44747]]
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 proposed rule change has become effective pursuant to Section
19(b)(3)(A)(i) of the Act \24\ and Rule 19b-4(f)(1) thereunder,\25\ 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 the self-regulatory organization.
NASD proposes to implement the revised Series 55 examination program on
August 15, 2006. NASD will announce the implementation date in a Notice
to Members to be published on the same date as this filing.
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\24\ 15 U.S.C. 78s(b)(3)(A)(i).
\25\ 17 CFR 240.19b-4(f)(1).
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At any time within 60 days of the filing of such 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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File No. SR-NASD-2006-086 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASD-2006-086. 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 (https://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-2006-086 and should be submitted on or before August 28, 2006.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\26\
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\26\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-12704 Filed 8-4-06; 8:45 am]
BILLING CODE 8010-01-P
