Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Revisions to the Series 62 Examination Program, 1375-1377 [E8-94]
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Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices
Number SR–FINRA–2007–027 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper Comments:
[Release No. 34–57081; File No. SR–FINRA–
2007–031]
• 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–FINRA–2007–027. 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, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3 p.m.
Copies of such filing also will be
available for inspection and copying at
the principal office of FINRA. 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 publicly available. All
submissions should refer to File
Number SR–FINRA–2007–027 and
should be submitted on or before
January 29, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–88 Filed 1–7–08; 8:45 am]
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BILLING CODE 8011–01–P
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CFR 200.30–3(a)(12).
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Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to Revisions to
the Series 62 Examination Program
December 31, 2007.
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 December
12, 2007, Financial Industry Regulatory
Authority, Inc. (‘‘FINRA’’) (f/k/a
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 substantially by FINRA.
FINRA has designated this proposal 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
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
FINRA is filing revisions to the study
outline and selection specifications for
the Limited Representative—Corporate
Securities (Series 62) 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 a
Limited Representative—Corporate
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 FINRA also is proposing corresponding
revisions to the Series 62 question bank, but based
upon instruction from the Commission staff, FINRA
is submitting SR–FINRA–2007–031 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, SEC, dated July 24, 2000,
attached as Exhibit 3c to the proposed rule change.
The question bank is available for Commission
review.
2 17
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Securities. FINRA is not proposing any
textual changes to the By-Laws,
Schedules to the By-Laws, or Rules of
FINRA.
The text of the proposed rule change
is available at www.finra.org, the
principal offices of FINRA, and the
Commission’s Public Reference Room.
The Series 62 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.6
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
FINRA 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. FINRA 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 7 requires
FINRA to prescribe standards of
training, experience, and competence
for persons associated with FINRA
members. In accordance with that
provision, FINRA has developed
examinations, and administers
examinations developed by other selfregulatory organizations, that are
designed to establish that persons
associated with FINRA members have
attained specified levels of competence
and knowledge. FINRA 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(e), each
associated person of a member who is
included within the definition of
representative in NASD Rule 1031(b)
may register with FINRA as a Limited
Representative—Corporate Securities if:
(1) The individual’s activities in the
investment banking and securities
business of the member are limited
solely to the solicitation, purchase and
sale of a ‘‘security,’’ as that term is
defined in section 3(a)(10) of the Act; (2)
the individual does not engage in any
6 17
7 15
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CFR 240.24b–2.
U.S.C. 78o–3(g)(3).
08JAN1
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Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices
activities relating to the following
securities: Municipal securities as
defined in section 3(a)(29) of the Act;
option securities as defined in NASD
Rule 2860; redeemable securities of
companies registered pursuant to the
Investment Company Act of 1940
(except for money market funds);
variable contracts of insurance
companies registered pursuant to the
Securities Act of 1933; and direct
participation program securities as
defined in NASD Rule 1022(e); and (3)
the individual passes the Series 62
qualification examination.
A committee of industry
representatives, together with FINRA
staff, recently undertook a review of the
Series 62 examination program. As a
result of this review, FINRA is
proposing to make 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 a Limited
Representative—Corporate Securities.
Among other revisions, FINRA is
proposing to revise the references to the
FINRA and The NASDAQ Stock Market
LLC (‘‘NASDAQ’’) rules in the study
outline to reflect NASDAQ’s separation
from FINRA (then known as NASD). In
addition, FINRA is proposing to add
sections on exchange-traded funds,
hedge funds, unit investment trusts,
SEC Regulation M–A (Mergers and
Acquisitions), SEC Regulation S–K, SEC
Regulation S–X, SEC Regulation NMS,
SEC Regulation SHO and SEC Rule 405
(Definitions of Terms). FINRA also is
proposing to add sections on NASD IM–
2110–7 (Interfering With the Transfer of
Customer Accounts in the Context of
Employment Disputes), IM–2440–2
(Additional Mark-Up Policy For
Transactions in Debt Securities, Except
Municipal Securities) and IM–2210–6
(Requirements for the Use of Investment
Analysis Tools), as well as on NASD
Rules 2111 (Trading Ahead of Customer
Market Orders), 2370 (Borrowing From
or Lending to Customers) and 2441 (Net
Transactions with Customers).
FINRA is proposing to change the title
of section 1 of the study outline from
‘‘Characteristics of Corporate Securities’’
to ‘‘Types and Characteristics of
Securities and Investments,’’ the title of
section 3 from ‘‘Valuing Corporate
Securities’’ to ‘‘Evaluation of Securities
and Investments,’’ and the title of
section 4 from ‘‘Handling Customer
Accounts’’ to ‘‘Handling Customer
Accounts and Securities Industry
Regulations.’’ Further, as a result of the
revisions discussed above, the number
of questions on each section of the study
outline was modified as follows: Types
and Characteristics of Securities and
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Investments, decreased from 28 to 25
questions; The Market for Corporate
Securities, increased from 31 to 40
questions; Evaluation of Securities and
Investments, no changes to the number
of questions (remains at 14 questions);
and Handling Customer Accounts and
Securities Industry Regulations,
decreased from 42 to 36 questions.
FINRA is proposing similar changes
to the Series 62 selection specifications
and question bank. The number of
questions on the Series 62 examination
will remain at 115, and candidates will
continue to have 21⁄2 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
FINRA believes that the proposed
revisions to the Series 62 examination
program are consistent with the
provisions of sections 15A(b)(6) 8 and
15A(g)(3) of the Act,9 which authorize
FINRA to prescribe standards of
training, experience, and competence
for persons associated with FINRA
members.
Notice to be published on December 12,
2007, the date FINRA filed SR–FINRA–
2007–31 with the Commission.
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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–FINRA–2007–031 on the
subject line.
Paper Comments
• Send paper comments in triplicate
B. Self-Regulatory Organization’s
to Nancy M. Morris, Secretary,
Statement on Burden on Competition
Securities and Exchange Commission,
FINRA does not believe that the
Station Place, 100 F Street, NE.,
proposed rule change will result in any
Washington, DC 20549–1090.
burden on competition that is not
All submissions should refer to File
necessary or appropriate in furtherance
Number SR–FINRA–2007–031. This file
of the purposes of the Act.
number should be included on the
subject line if e-mail is used. To help the
C. Self-Regulatory Organization’s
Commission process and review your
Statement on Comments on the
comments more efficiently, please use
Proposed Rule Change Received From
only one method. The Commission will
Members, Participants or Others
post all comments on the Commission’s
Written comments were neither
Internet Web site (https://www.sec.gov/
solicited nor received.
rules/sro.shtml). Copies of the
submission, all subsequent
III. Date of Effectiveness of the
amendments, all written statements
Proposed Rule Change and Timing for
with respect to the proposed rule
Commission Action
The proposed rule change has become change that are filed with the
Commission, and all written
effective pursuant to section
19(b)(3)(A)(i) of the Act 10 and Rule 19b– communications relating to the
proposed rule change between the
4(f)(1) thereunder,11 in that the
Commission and any person, other than
proposed rule change constitutes a
stated policy, practice, or interpretation those that may be withheld from the
public in accordance with the
with respect to the meaning,
provisions of 5 U.S.C. 552, will be
administration, or enforcement of an
available for inspection and copying in
existing rule of the self-regulatory
the Commission’s Public Reference
organization. FINRA proposes to
Room, 100 F Street, NE., Washington,
implement the revised Series 62
DC 20549, on official business days
examination program on February 12,
between the hours of 10 a.m. and 3 p.m.
2008. FINRA will announce the
Copies of such filing also will be
implementation date in a Regulatory
available for inspection and copying at
the principal office of FINRA. All
8 15 U.S.C. 78o–3(b)(6).
comments received will be posted
9 15 U.S.C. 78o–3(g)(3).
10 15 U.S.C. 78s(b)(3)(A)(i).
without change; the Commission does
11 17 CFR 240.19b–4(f)(1).
not edit personal identifying
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Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices
information from submissions. You
should submit only information that
you wish to make publicly available. All
submissions should refer to File
Number SR–FINRA–2007–031 and
should be submitted on or before
January 29, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–94 Filed 1–7–08; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–57070; File No. SR–Amex–
2007–139]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing and Immediate Effectiveness
of a Proposed Rule Change to Retire
the EEM Options Pilot Program
December 31, 2007.
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 December
20, 2007, the American Stock Exchange
LLC (‘‘Amex’’ or ‘‘Exchange’’) 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 substantially prepared by the
Exchange. The Exchange has filed the
proposal pursuant to section 19(b)(3)(A)
of the Act 3 and Rule 19b–4(f)(6)
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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to retire an
existing pilot program (the ‘‘Pilot’’),5
that permits the Exchange to list and
trade options (‘‘Fund Options’’) on the
iShares MSCI Emerging Markets Index
Fund (‘‘Fund’’).6 The text of the
12 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).
5 See Securities Exchange Act Release No. 53824
(May 17, 2006), 71 FR 30003 (May 24, 2007) (SR–
Amex–2006–43).
6 The Fund is an open-end investment company
designed to hold a portfolio of securities that track
the MSCI Emerging Markets Index (the ‘‘Index’’).
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proposed rule change is available on the
Amex’s Web site (https://
www.amex.com), at the Exchange’s
Office of the Secretary 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, the
Exchange 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
Exchange 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
The purpose of this rule change is to
retire the Pilot that permits the
Exchange to list the Fund Options
because the Fund now meets all of the
Exchange’s generic initial and
maintenance standards.
On May 17, 2006, the Commission
approved the Amex proposal to list and
trade the Fund Options for a 60-day
pilot period that expired on July 2,
2006.7 On June 30, 2006, the
Commission approved a 90-day
extension to the Pilot that expired on
October 1, 2006.8 On September 29,
2006, the Commission approved a
second 90-day extension to the Pilot
that expired on January 2, 2007.9 On
January 3, 2007, the Commission
approved a third extension to the Pilot
for an additional 180-day period to
expire on June 30, 2007.10 On June 25,
2007, the Commission approved a
fourth extension to the Pilot for an
additional six (6) months, set to expire
on December 31, 2007.11
The Index is a capitalization-weighted index
created and maintained by Morgan Stanley Capital
International, Inc. For a complete description of the
Fund and the Index, see id.
7 See supra note 5.
8 See Securities Exchange Act Release No. 34–
54081 (June 30, 2006), 71 FR 38911 (July 10, 2006)
(File No. SR–Amex–2006–60).
9 See Securities Exchange Act Release No. 34–
54553 (Sept. 29, 2006), 71 FR 59561 (Oct. 10, 2006)
(File No. SR–Amex–2006–91).
10 See Securities Exchange Act Release No. 34–
55040 (Jan. 3, 2007), 72 FR 1348 (Jan. 11, 2007) (File
No. SR–Amex–2007–01).
11 See Securities Exchange Act Release No. 34–
55955 (June 25, 2007), 72 FR 36079 (July 2, 2007)
(File No. SR–Amex–2007–57).
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1377
The Fund now meets the Exchange’s
listing and maintenance standards in
Commentary .06 to Amex Rule 915 and
Commentary .07 to Amex Rule 916,
respectively (the ‘‘Listing
Standards’’ 12). The Listing Standards
permit the Exchange to list funds
structured as open-end investment
companies, such as the Fund, without
having to file for approval with the
Commission to list for trading options
on such funds.
When the Exchange first sought to list
options on the Fund, the Exchange had
determined that the Fund met
substantially all of the Exchange’s
Listing Standards requirements, but did
not meet the Listing Standards
requirement that no more than 50% of
the weight of the securities in the Fund
be comprised of securities that are not
subject to a comprehensive surveillance
sharing agreement (‘‘CSSA’’).13 The
Exchange had in place CSSAs with
foreign exchanges that covered 46.72%
of the securities in the fund. In order to
meet the 50% threshold, the Exchange
requested the Commission’s approval to
rely upon a memorandum of
understanding that the Commission had
entered into with the CNBV 14 (the
‘‘MOU’’) because the securities traded
on Bolsa represented 7.42% of the
weight of the Fund.15
The Fund has now become compliant
with Commentary .06(b)(i) to Amex
Rule 915 because the Korean Exchange
(‘‘KRX’’) 16 recently became a member of
the Intermarket Surveillance Group and,
therefore, securities and other products
trading on its markets are now subject
to a CSSA. As a result, the percentage
of the weights of the Fund represented
by South Korean securities now renders
the Fund compliant with the Exchange’s
Listing Standards requirements because
12 Commentary .06 to Amex Rule 915 sets forth
the initial listing and maintenance standards for
shares or other securities (‘‘Exchange-Traded Fund
Shares’’) that are principally traded on a national
securities exchange or through the facilities of a
national securities exchange and reported as a
national market security, and that represent an
interest in a registered investment company
organized as an open-end management investment
company, a unit investment trust or other similar
entity.
13 See Commentary .06(b)(i) to Amex Rule 915.
14 The National Commission for Banking and
Securities, or ‘‘CNBV,’’ is Mexico’s regulatory body
for financial markets and banking. The CNBV
regulates the Bolsa Mexicana de Valores (‘‘Bolsa’’).
15 See supra note 5. The Commission permitted
the Exchange to rely on the MOU, and the Exchange
agreed to use its best efforts to obtain a CSSA with
the Bolsa during the respective pilot periods, which
to date has not been obtained.
16 The KRX was created on January 27, 2005
through the consolidation of three domestic Korean
Exchanges: Korea Stock Exchange (KSE), KOSDAQ
Market and Korea Futures Market (KOFEX). See
https://neg.krx.co.kr/.
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]]>Agencies
[Federal Register Volume 73, Number 5 (Tuesday, January 8, 2008)]
[NOTI]
[Pages 1375-1377]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-94]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-57081; File No. SR-FINRA-2007-031]
Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of
Proposed Rule Change Relating to Revisions to the Series 62 Examination
Program
December 31, 2007.
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 December 12, 2007, Financial Industry Regulatory Authority, Inc.
(``FINRA'') (f/k/a 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 substantially by
FINRA. FINRA has designated this proposal 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 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
FINRA is filing revisions to the study outline and selection
specifications for the Limited Representative--Corporate Securities
(Series 62) 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 a Limited Representative--Corporate Securities.
FINRA is not proposing any textual changes to the By-Laws, Schedules to
the By-Laws, or Rules of FINRA.
---------------------------------------------------------------------------
\5\ FINRA also is proposing corresponding revisions to the
Series 62 question bank, but based upon instruction from the
Commission staff, FINRA is submitting SR-FINRA-2007-031 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, SEC, dated July
24, 2000, attached as Exhibit 3c to the proposed rule change. The
question bank is available for Commission review.
---------------------------------------------------------------------------
The text of the proposed rule change is available at www.finra.org,
the principal offices of FINRA, and the Commission's Public Reference
Room. The Series 62 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.\6\
---------------------------------------------------------------------------
\6\ 17 CFR 240.24b-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, FINRA 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. FINRA 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 \7\ requires FINRA to prescribe
standards of training, experience, and competence for persons
associated with FINRA members. In accordance with that provision, FINRA
has developed examinations, and administers examinations developed by
other self-regulatory organizations, that are designed to establish
that persons associated with FINRA members have attained specified
levels of competence and knowledge. FINRA 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.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78o-3(g)(3).
---------------------------------------------------------------------------
Pursuant to NASD Rule 1032(e), each associated person of a member
who is included within the definition of representative in NASD Rule
1031(b) may register with FINRA as a Limited Representative--Corporate
Securities if: (1) The individual's activities in the investment
banking and securities business of the member are limited solely to the
solicitation, purchase and sale of a ``security,'' as that term is
defined in section 3(a)(10) of the Act; (2) the individual does not
engage in any
[[Page 1376]]
activities relating to the following securities: Municipal securities
as defined in section 3(a)(29) of the Act; option securities as defined
in NASD Rule 2860; redeemable securities of companies registered
pursuant to the Investment Company Act of 1940 (except for money market
funds); variable contracts of insurance companies registered pursuant
to the Securities Act of 1933; and direct participation program
securities as defined in NASD Rule 1022(e); and (3) the individual
passes the Series 62 qualification examination.
A committee of industry representatives, together with FINRA staff,
recently undertook a review of the Series 62 examination program. As a
result of this review, FINRA is proposing to make 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 a Limited Representative--Corporate Securities.
Among other revisions, FINRA is proposing to revise the references
to the FINRA and The NASDAQ Stock Market LLC (``NASDAQ'') rules in the
study outline to reflect NASDAQ's separation from FINRA (then known as
NASD). In addition, FINRA is proposing to add sections on exchange-
traded funds, hedge funds, unit investment trusts, SEC Regulation M-A
(Mergers and Acquisitions), SEC Regulation S-K, SEC Regulation S-X, SEC
Regulation NMS, SEC Regulation SHO and SEC Rule 405 (Definitions of
Terms). FINRA also is proposing to add sections on NASD IM-2110-7
(Interfering With the Transfer of Customer Accounts in the Context of
Employment Disputes), IM-2440-2 (Additional Mark-Up Policy For
Transactions in Debt Securities, Except Municipal Securities) and IM-
2210-6 (Requirements for the Use of Investment Analysis Tools), as well
as on NASD Rules 2111 (Trading Ahead of Customer Market Orders), 2370
(Borrowing From or Lending to Customers) and 2441 (Net Transactions
with Customers).
FINRA is proposing to change the title of section 1 of the study
outline from ``Characteristics of Corporate Securities'' to ``Types and
Characteristics of Securities and Investments,'' the title of section 3
from ``Valuing Corporate Securities'' to ``Evaluation of Securities and
Investments,'' and the title of section 4 from ``Handling Customer
Accounts'' to ``Handling Customer Accounts and Securities Industry
Regulations.'' Further, as a result of the revisions discussed above,
the number of questions on each section of the study outline was
modified as follows: Types and Characteristics of Securities and
Investments, decreased from 28 to 25 questions; The Market for
Corporate Securities, increased from 31 to 40 questions; Evaluation of
Securities and Investments, no changes to the number of questions
(remains at 14 questions); and Handling Customer Accounts and
Securities Industry Regulations, decreased from 42 to 36 questions.
FINRA is proposing similar changes to the Series 62 selection
specifications and question bank. The number of questions on the Series
62 examination will remain at 115, and candidates will continue to have
2\1/2\ 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
FINRA believes that the proposed revisions to the Series 62
examination program are consistent with the provisions of sections
15A(b)(6) \8\ and 15A(g)(3) of the Act,\9\ which authorize FINRA to
prescribe standards of training, experience, and competence for persons
associated with FINRA members.
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\8\ 15 U.S.C. 78o-3(b)(6).
\9\ 15 U.S.C. 78o-3(g)(3).
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B. Self-Regulatory Organization's Statement on Burden on Competition
FINRA 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 proposed rule change has become effective pursuant to section
19(b)(3)(A)(i) of the Act \10\ and Rule 19b-4(f)(1) thereunder,\11\ 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.
FINRA proposes to implement the revised Series 62 examination program
on February 12, 2008. FINRA will announce the implementation date in a
Regulatory Notice to be published on December 12, 2007, the date FINRA
filed SR-FINRA-2007-31 with the Commission.
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\10\ 15 U.S.C. 78s(b)(3)(A)(i).
\11\ 17 CFR 240.19b-4(f)(1).
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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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-FINRA-2007-031 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-FINRA-2007-031. 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, 100 F Street,
NE., Washington, DC 20549, on official business days between the hours
of 10 a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of FINRA. All comments
received will be posted without change; the Commission does not edit
personal identifying
[[Page 1377]]
information from submissions. You should submit only information that
you wish to make publicly available. All submissions should refer to
File Number SR-FINRA-2007-031 and should be submitted on or before
January 29, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-94 Filed 1-7-08; 8:45 am]
BILLING CODE 8011-01-P
