Self-Regulatory Organizations; Notice of Filing of Proposed Rule Change by the Boston Stock Exchange, Inc. Relating to the Appointment of Market Makers on the Boston Options Exchange Facility, 50845-50846 [E8-19945]
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Federal Register / Vol. 73, No. 168 / Thursday, August 28, 2008 / Notices
jlentini on PROD1PC65 with NOTICES
before the professional engagement
period begins.
On April 22, 2008, the Board adopted
the amendment to PCAOB Rule 3523 to
exclude the portion of the audit period
that precedes the beginning of the
professional engagement period and a
rule amendment to further delay the
implementation date for that portion of
Rule 3523 until December 31, 2008.
The proposed amendment to PCAOB
Rule 3523 provides that the Board will
not apply Rule 3523 to tax services
when those services are provided during
the audit period and are completed
before the professional engagement
period begins. Rule 3523 continues to
apply to tax services provided during
the professional engagement period.
Pursuant to the requirements of
Section 107(b) of the Act and Section
19(b) of the Securities Exchange Act of
1934 (the ‘‘Exchange Act’’), the
Commission published the PCAOB’s
proposed Ethics and Independence Rule
3526, Communication with Audit
Committees Concerning Independence,
conforming amendments to its interim
standard ISB No. 1 and two related
interpretations, and amendment to Rule
3523, Tax Services for Persons in
Financial Reporting Oversight Roles for
public comment in the Federal Register
on July 14, 2008.13
III. Discussion
The Commission received two
comment letters relating to proposed
Rule 3526, both of which were generally
supportive of the proposed rule.14 One
of the firms, however, expressed
concerns relating to the timing of the
required communication of Rule 3526
and its effect on an auditor’s
participation in the activities associated
with an initial public offering. The firm
also expressed concerns about the
difference between the ‘‘audit and
professional engagement period’’
referenced in the SEC’s independence
rules and Rule 3526’s requirement to
communicate matters that may have
existed outside of this time period. The
firm requested that the Commission
include clarifying commentary in its
approval order regarding these matters
and urged the PCAOB to issue
additional interpretive guidance to aid
in the consistent application of the
rules.
The PCAOB carefully considered the
commenter’s concerns before it adopted
Rule 3526 and addressed those concerns
in its adopting release. We do not
believe that any clarifying commentary
13 See SEC Release No. 34–58121 (Jul. 9, 2008);
73 FR 40418 (Jul. 14, 2008).
14 Ernst & Young LLP and Deloitte & Touche LLP.
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50845
is necessary at this time. We encourage
the PCAOB to carefully monitor the
implementation of Rule 3526 and to
provide appropriate guidance if it is
needed in the future.
The Commission received three
comment letters relating to the proposed
amendment to Rule 3523. Two of the
commenters were supportive of the
amendment to Rule 3523.15 The other
commenter 16 expressed concern that
Rule 3523 ‘‘put[s] a huge burden on
smaller companies and larger tax firms’’
because some companies could have
large numbers of employees and
chances are that some of those
employees could be receiving tax
services from potential external
auditors. While purportedly outside the
scope of the proposed amendment,
which in fact limits the scope of the rule
to a narrower period of just the
professional engagement period, it
should also be noted that Rule 3523
applies only to persons in a financial
reporting oversight role (FROR). This
term is defined in PCAOB Rule 3501 as:
IV. Conclusion
On the basis of the foregoing, the
Commission finds that the PCAOB’s
proposed Ethics and Independence Rule
3526, Communication with Audit
Committees Concerning Independence,
conforming amendments to its interim
standard ISB No. 1 and two related
interpretations, and amendment to Rule
3523, Tax Services for Persons in
Financial Reporting Oversight Roles, are
consistent with the requirements of the
Act and the securities laws and are
necessary and appropriate in the public
interest and for the protection of
investors.
It is therefore ordered, pursuant to
Section 107 of the Act and Section
19(b)(2) of the Exchange Act, that the
proposed rule changes (File No.
PCAOB–2008–03) be, and hereby are,
approved.
[A] role in which a person is in a position
to or does exercise influence over the
contents of the financial statements or
anyone who prepares them, such as when the
person is a member of the board of directors
or similar management or governing body,
chief executive officer, president, chief
financial officer, chief operating officer,
general counsel, chief accounting officer,
controller, director of internal audit, director
of financial reporting, treasurer, or any
equivalent position.
BILLING CODE 8010–01–P
Rule 3523 is further limited to exclude
persons (i) who are in a FROR only
because he or she serves as a member of
the board of directors or similar
management or governing body of the
audit client, (ii) who are in FROR at
affiliates if the affiliate’s financial
statements are immaterial or audited by
a different auditor and (iii) who
received tax services before being hired
or promoted into a FROR if the services
are completed on or before 180 days
after the hiring or promotion event.
The PCAOB is not proposing to
change the persons subject to Rule 3523
in its proposing amendment. The
PCAOB gave careful consideration to
the issues raised by the commenter prior
to Rule 3523’s adoption by the Board.
PCAOB Rules 3526 and 3523,
including the proposed amendment to
Rule 3523 and the conforming
amendments to the interim standards,
are a reasonable exercise of the Board’s
rule-making authority under the Act.
& Young LLP and Deloitte & Touche LLP.
L. Garzia, Student, Business
Management, Tappan, New York.
By the Commission.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–19989 Filed 8–27–08; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58408; File No. SR–BSE–
2008–42]
Self-Regulatory Organizations; Notice
of Filing of Proposed Rule Change by
the Boston Stock Exchange, Inc.
Relating to the Appointment of Market
Makers on the Boston Options
Exchange Facility
August 22, 2008.
Pursuant to section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on August
19, 2008, the Boston Stock Exchange,
Inc. (‘‘BSE’’ 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 prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
section 5 (Obligations of Market Makers)
of Chapter VI of the Rules of the Boston
Options Exchange Group, LLC (‘‘BOX’’).
15 Ernst
16 Matthew
PO 00000
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1 15
2 17
E:\FR\FM\28AUN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
28AUN1
50846
Federal Register / Vol. 73, No. 168 / Thursday, August 28, 2008 / Notices
The text of the proposed rule change is
available on the Exchange’s Internet
Web site at https://
www.bostonstock.com, from the
principal office of the Exchange and
from the Commission.
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
self-regulatory organization 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 self-regulatory organization 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
jlentini on PROD1PC65 with NOTICES
1. Purpose
The purpose of the proposed rule
change is to remove certain language
from section 5(a)(viii) of Chapter VI of
the BOX Rules to eliminate any
potential for confusion between this and
section 4(f) of Chapter VI of the BOX
Rules.
Currently, section 4(f) of Chapter VI
states that ‘‘Market Makers may
withdraw from trading an options class
that is within their appointment by
providing the BOX with three business
days’ written notice of such
withdrawal.’’ However, Section
5(a)(viii) states that ‘‘[o]rdinarily,
Market Makers are expected to * * *
[m]aintain active markets in all classes
in which the Market Maker is appointed
for a period of at least six months.’’ To
address this potential ambiguity, the
Exchange seeks to remove the language
‘‘for a period of at least six months’’
from section 5(a)(viii). As a result, a
Market Maker seeking to withdraw from
a particular appointment will be
required to provide BOX with at least
three business days written notice of
such withdrawal, as stated in section
4(f), regardless of how long the Market
Maker has held such appointment.
In addition, the proposed rule change
will result in certain changes to the
formatting and text of Supplementary
Material to Chapter VI, Section 5(c)(ii)
of the BOX Rules. The rule change is
non-substantive, and it will result in a
closer universal format throughout the
BOX Rules.
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17:36 Aug 27, 2008
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2. Basis
The Exchange believes that the
proposal is consistent with the
requirements of section 6(b) of the Act,3
in general, and section 6(b)(5) of the
Act,4 in particular, in that it is designed
to prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to foster
cooperation and coordination with
persons engaged in facilitating
transactions in securities, to remove
impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general, to protect investors and the
public interest. The proposed rule
change will create greater clarity within
the BOX Rules concerning Market
Maker appointments in specific options
classes and requests to withdraw from
such appointments.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition 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
The Exchange has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding or
(ii) as to which the self-regulatory
organization consents, the Commission
will:
(a) By order approve such proposed
rule change, or
(b) Institute proceedings to determine
whether the proposed rule change
should be disapproved.
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:
3 15
4 15
PO 00000
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
Frm 00091
Fmt 4703
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–BSE–2008–42 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BSE–2008–42. 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 the filing also will be available
for inspection and copying at the
principal office of the self-regulatory
organization. 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–BSE–
2008–42 and should be submitted on or
before September 18, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.5
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–19945 Filed 8–27–08; 8:45 am]
BILLING CODE 8010–01–P
5 17
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CFR 200.30–3(a)(12).
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]]>Agencies
[Federal Register Volume 73, Number 168 (Thursday, August 28, 2008)]
[Notices]
[Pages 50845-50846]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-19945]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58408; File No. SR-BSE-2008-42]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Boston Stock Exchange, Inc. Relating to the Appointment
of Market Makers on the Boston Options Exchange Facility
August 22, 2008.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on August 19, 2008, the Boston Stock Exchange, Inc. (``BSE'' 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 prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend section 5 (Obligations of Market
Makers) of Chapter VI of the Rules of the Boston Options Exchange
Group, LLC (``BOX'').
[[Page 50846]]
The text of the proposed rule change is available on the Exchange's
Internet Web site at https://www.bostonstock.com, from the principal
office of the Exchange and from the Commission.
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 self-regulatory organization
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 self-regulatory organization
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 the proposed rule change is to remove certain
language from section 5(a)(viii) of Chapter VI of the BOX Rules to
eliminate any potential for confusion between this and section 4(f) of
Chapter VI of the BOX Rules.
Currently, section 4(f) of Chapter VI states that ``Market Makers
may withdraw from trading an options class that is within their
appointment by providing the BOX with three business days' written
notice of such withdrawal.'' However, Section 5(a)(viii) states that
``[o]rdinarily, Market Makers are expected to * * * [m]aintain active
markets in all classes in which the Market Maker is appointed for a
period of at least six months.'' To address this potential ambiguity,
the Exchange seeks to remove the language ``for a period of at least
six months'' from section 5(a)(viii). As a result, a Market Maker
seeking to withdraw from a particular appointment will be required to
provide BOX with at least three business days written notice of such
withdrawal, as stated in section 4(f), regardless of how long the
Market Maker has held such appointment.
In addition, the proposed rule change will result in certain
changes to the formatting and text of Supplementary Material to Chapter
VI, Section 5(c)(ii) of the BOX Rules. The rule change is non-
substantive, and it will result in a closer universal format throughout
the BOX Rules.
2. Basis
The Exchange believes that the proposal is consistent with the
requirements of section 6(b) of the Act,\3\ in general, and section
6(b)(5) of the Act,\4\ in particular, in that it is designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, to foster cooperation and coordination
with persons engaged in facilitating transactions in securities, to
remove impediments to and perfect the mechanism of a free and open
market and a national market system, and, in general, to protect
investors and the public interest. The proposed rule change will create
greater clarity within the BOX Rules concerning Market Maker
appointments in specific options classes and requests to withdraw from
such appointments.
---------------------------------------------------------------------------
\3\ 15 U.S.C. 78f(b).
\4\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition 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
The Exchange has neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(a) By order approve such proposed rule change, or
(b) Institute proceedings to determine whether the proposed rule
change should be disapproved.
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-BSE-2008-42 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-BSE-2008-42. 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 the filing also will be available for
inspection and copying at the principal office of the self-regulatory
organization. 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-BSE-
2008-42 and should be submitted on or before September 18, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\5\
---------------------------------------------------------------------------
\5\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-19945 Filed 8-27-08; 8:45 am]
BILLING CODE 8010-01-P
