Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Conforming Certain NYSE Rules to Changes to NYSE Incorporated Rules Recently Filed by the Financial Industry Regulatory Authority, Inc., 54444-54446 [E8-21948]

Download as PDF jlentini on PROD1PC65 with NOTICES 54444 Federal Register / Vol. 73, No. 183 / Friday, September 19, 2008 / Notices recognizing these limitations, the Commission agrees with the Exchange that consideration of both of these values should provide the Exchange with an estimation of a company’s market value that supports listing the company on the Exchange. In addition, the proposed rule is designed to ensure that the Valuation is reliable by providing that the Valuation must be provided by an entity that has significant experience and demonstrable competence in providing valuations of companies, and must be of a recent date as of the time of the approval of the company for listing. Further, by assuming a market value equal to the lesser of the Valuation and a value based on the most recent Private Placement Market trading, the Exchange will be using the more conservative estimate of a company’s market value. In addition, the Commission notes that companies listing under this alternative provision will be required to meet higher market value standards. Specifically, companies will have to meet the $100 million transfer market value requirement, rather than the $60 million IPO requirement of Section 102.01B. Further, companies will be required to meet global market capitalization standards in Section 102.01C of the Manual that are 20% higher than the normal standards.9 The Commission notes that it expects the vast majority of companies to continue to list in connection with a firm commitment underwritten IPO, upon transfer from another market, or pursuant to a spin-off, and that this proposed alternative standard will be used by the Exchange at its discretion. In particular, in accordance with the terms of the proposed rule, the Exchange will apply this standard only for the very narrow category of companies that are seeking to list their common equity securities on the Exchange without an underwritten offering at the time of effectiveness of a registration statement registering only the resale of shares sold by the company in earlier private placements. Further, the Commission expects the Exchange to utilize its discretion only after thorough consideration and evaluation of the specific company and all relevant factors. Specifically, the proposed rule change requires the Exchange to consider the appropriateness of relying on Private Placement Market trading in light of the price trends for the stock over a period of several months and only rely on a Private Placement Market price if consistent with a sustained 9 See Section II, Description of the Proposal, supra. VerDate Aug<31>2005 17:25 Sep 18, 2008 Jkt 214001 history evidencing a market value in excess of the listing requirement. In relying on such Private Placement Market, the Commission expects the NYSE to consider the trading characteristics of the stock, including its trading volume and price volatility over a sustained period of time. In addition, in relying on the Valuation, the Exchange must consider any market factors or factors particular to the listing applicant that would cause concern that the value of the company had diminished since the date of Valuation and continue to monitor the company and the appropriateness of relying on the Valuation up until the time of listing. The Commission expects that where these factors indicate that the value calculated may not be an accurate estimation of a company’s market value, the Exchange will use its discretion to determine not to list such company pursuant to the proposed provisions. In general, the Commission expects that the Exchange will deny listing to any company seeking to list pursuant to the proposed rule change if the Exchange determines that the listing of any such company is not in the interests of the Exchange or the public interest. The Commission also notes that companies listing pursuant to the new proposed provision will still be required to meet the IPO distribution requirements of Section 102.01A of the Manual, i.e., that the company have 400 beneficial holders of round lots of 100 shares and 1,100,000 publicly held shares. The Commission believes that these existing provisions will continue to help ensure that the company has the requisite liquidity for listing on the Exchange.10 The Exchange’s reliance on the transfer agent for assurance that the holder requirement is met, and on the disclosure in the company’s registration statement for assurance that the publicly held shares requirement is met, will ensure that these important liquidity requirements are verified before a company may qualify for listing. For the reasons set forth above, the Commission finds that the proposed rule change is consistent with the Act. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,11 that the 10 See also note 8 supra. The Commission notes that once listed, the company would have to comply with the continued listing standards like other companies. The NYSE has not proposed any changes to the continued listing standards for companies listing under the provisions approved herein. See Section 802 of the Manual. 11 15 U.S.C. 78s(b)(2). PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 proposed rule change (SR–NYSE–2008– 68) be, and hereby is, approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.12 Florence E. Harmon, Acting Secretary. [FR Doc. E8–21944 Filed 9–18–08; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58549; File No. SR–NYSE– 2008–80] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Conforming Certain NYSE Rules to Changes to NYSE Incorporated Rules Recently Filed by the Financial Industry Regulatory Authority, Inc. September 15, 2008. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on September 5, 2008, New York Stock Exchange LLC (‘‘NYSE’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. On September 11, 2008, the Exchange filed Amendment No. 1. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend certain New York Stock Exchange (‘‘NYSE’’ or the ‘‘Exchange’’) Rules to conform with proposed amendments to certain NYSE Incorporated Rules (defined below) recently filed by the Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) 4 to reduce regulatory duplication and relieve firms that are members of both FINRA and the Exchange of conflicting or unnecessary regulatory burdens in the interim period 12 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 4 See Securities Exchange Act Release No. 58533 (September 12, 2008) (SR–FINRA–2008–036). 1 15 E:\FR\FM\19SEN1.SGM 19SEN1 Federal Register / Vol. 73, No. 183 / Friday, September 19, 2008 / Notices prior to completion of a consolidated FINRA rulebook. 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 those 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 parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose jlentini on PROD1PC65 with NOTICES On July 30, 2007, NASD and NYSE Regulation, Inc. consolidated their member firm regulation operations into a combined organization, FINRA.5 As noted above, pursuant to its new regulatory responsibilities, FINRA recently filed proposed amendments to certain NYSE Incorporated Rules (and applicable Rule Interpretations). The NYSE hereby proposes to amend its version of these same rules to conform to the proposed changes filed by FINRA. The amendments proposed by FINRA fall into the following categories: 6 • Replacing the term ‘‘allied member’’ with the newly defined category of ‘‘principal executive’’, and making 5 Pursuant to Rule 17d–2 under the Securities Exchange Act of 1934, as amended (the ‘‘Exchange Act’’), NYSE, NYSE Regulation, Inc., and NASD entered into an agreement (the ‘‘Agreement’’) to reduce regulatory duplication for firms that are members of FINRA and also members of NYSE on or after July 30, 2007 (‘‘Dual Members’’), by allocating to FINRA certain regulatory responsibilities for selected NYSE rules. The Agreement includes a list of all of those NYSE and NASD rules for which FINRA has assumed regulatory responsibilities (‘‘Common Rules’’). See Securities Exchange Act Release No. 56148 (July 26, 2007), 72 FR 42146 (August 1, 2007) (Notice of Filing and Order Approving and Declaring Effective a Plan for the Allocation of Regulatory Responsibilities). The Common Rules include those NYSE rules that FINRA has incorporated into its rulebook (the ‘‘NYSE Incorporated Rules’’). See Securities Exchange Act Release No. 56147 (July 26, 2007), 72 FR 42166 (August 1, 2007) (Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change to Incorporate Certain NYSE Rules Relating to Member Firm Conduct; File No. SR–NASD–2007–054). Paragraph 2(b) of the 17d–2 Agreement sets forth procedures regarding proposed changes by either NYSE or FINRA to the substance of any of the Common Rules. 6 For more detail, see Securities Exchange Act Release No. 58103 (July 3, 2008), 73 FR 40403 (July 14, 2008) (SR–FINRA–2008–036). VerDate Aug<31>2005 17:25 Sep 18, 2008 Jkt 214001 corresponding technical changes as needed, in NYSE Incorporated Rules 2, 2A, 311–313, 321, 342, 345, 345A, 346, 351–354, 401, 405, 407–410, 414, 424, 431, 435, 440F, 440G, 477, 704, 705, 723, 724 and 791. • Repositioning and consolidating certain NYSE Incorporated Rules. In order to consolidate all ‘‘Buy-In’’ requirements and procedures into one rule, FINRA proposes to reposition NYSE Incorporated Rule 283 and 285– 290 as supplementary material in NYSE Incorporated Rule 282, and to make conforming changes to NYSE Incorporated Rule 134. FINRA also proposes to move certain provisions of NYSE Incorporated Rule 407 to Common Rule 346. • Deleting NYSE Incorporated Rules that are obsolete or no longer applicable, including Rules 311(h) and 436. • Eliminating certain provisions of NYSE Incorporated Rules that do not have a corresponding NASD equivalent, and therefore are deemed unnecessary rules, including the training requirements and registration for ‘‘securities trader’’ under Rule 345, Rule 345(b) and Rule 346(c). • Additional amendments to further harmonize certain NYSE and NASD Rules, including NYSE Incorporated Rules 342.13(a), 346(e), 346.10, 351.13, 352(c) and (d), and 408(a). In order to further harmonize NYSE Incorporated Rule 282 with NASD’s 11000 Rule Series, FINRA also proposes to add as supplementary material the substance of NYSE Rule 140 and provisions from NASD Rule 11810. • Deleting NYSE Incorporated Rules that are substantively duplicative of existing NASD Rules and procedures, including Rules 404, 412 and 446. Similarly, FINRA proposes limiting application of NYSE Incorporated Rule 345(a) to securities lending representatives and supervisors only, since registered representatives and their supervisors are already addressed by NASD Rule 1031. For these particular proposed changes, the Exchange proposes to amend NYSE Rules 404, 412, 446 and 345(a) to incorporate by reference the applicable NASD Rules that will be applied by FINRA going forward.7 The Exchange proposes to amend its version of the above-referenced NYSE 7 The Exchange recognizes that the proposed amendments to NYSE Rules 404, 412, 446 and 345(a) will remove these Rules from their status as Common Rules under the 17d–2 Agreement. Notwithstanding, FINRA will continue to provide regulatory services to the Exchange with respect to these Rules pursuant to the existing Regulatory Services Agreement, dated July 30, 2007, by and among FINRA, the Exchange and NYSE Regulation, Inc. PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 54445 Incorporated Rules to conform to FINRA’s proposed rule changes. The Exchange proposes that the operative date of the proposed rule changes be the same as the operative date of FINRA’s proposed amendments to the NYSE Incorporated Rules and Rule Interpretations. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with and furthers the objectives of Section 6(b)(5) 8 of the Act, in that it is designed to prevent fraudulent and manipulative practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanisms of, a free and open market and a national market system, and, in general, to protect investors and the public interest. The Exchange believes that the proposed rule changes will provide greater harmonization between NYSE Incorporated Rules and NASD Rules of similar purpose, resulting in less burdensome and more efficient regulatory compliance for their members. Where proposed amendments do not entirely conform to existing NYSE Incorporated or NASD Rules or address a provision without a direct counterpart, the Exchange believes the standards the proposed amendments establish further the objectives of the Exchange Act by providing greater regulatory clarity and relieving unnecessary regulatory burdens in the interim period until a Consolidated Rulebook is completed. 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 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 No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 9 and Rule 19b–4(f)(6) thereunder.10 Because the 8 15 U.S.C. 78f(b)(5). U.S.C. 78s(b)(3)(A)(iii). 10 17 CFR 240.19b–4(f)(6). 9 15 E:\FR\FM\19SEN1.SGM 19SEN1 54446 Federal Register / Vol. 73, No. 183 / Friday, September 19, 2008 / Notices jlentini on PROD1PC65 with NOTICES proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b–4(f)(6)(iii) thereunder.11 A proposed rule change filed under Rule 19b–4(f)(6) 12 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b–4(f)(6)(iii), 13 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has requested that the Commission waive the 30-day operative delay so that the proposed rule change may become operative pursuant to Section 19(b)(3)(A) and Rule 19b–4(f)(6) at the same time that FINRA’s proposed amendments become operative. The purpose of the proposed rule change is to conform NYSE Rules to FINRA’s proposed amendments to certain NYSE Incorporated Rules, in furtherance of the consolidation of the member firm regulations functions of NYSE Regulation and FINRA. NYSE requests that the operative date of the proposed rule change be the same as the operative date of FINRA’s proposal in order to ensure that the NYSE Rules maintain their status as Common Rules under the 17d–2 Agreement. As provided in paragraph 2(b) of the Agreement, FINRA and NYSE will, absent a disagreement about the substance of a proposed rule change to one of the Common Rules, promptly propose conforming changes to ensure that such rules continue to be Common Rules under the Agreement. For this reason, the Commission designates that the proposed rule change has become operative as of September 12, 2008.14 11 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 19b–4(f)(6)(iii) requires the Exchange to give the Commission written notice of the Exchange’s intent to file the proposed rule change along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied the pre-filing requirement. 12 17 CFR 240.19b–4(f)(6). 13 17 CFR 240.19b–4(f)(6)(iii). 14 For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). VerDate Aug<31>2005 17:25 Sep 18, 2008 Jkt 214001 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.15 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–NYSE–2008–80 and should be submitted on or before October 10, 2008. 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: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Florence E. Harmon, Acting Secretary. [FR Doc. E8–21948 Filed 9–18–08; 8:45 am] 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–NYSE–2008–80 on the subject line. SECURITIES AND EXCHANGE COMMISSION Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NYSE–2008–80. 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, 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 the Exchange. All comments received will be posted 15 15 U.S.C. 78s(b)(3)(C). For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposal, the Commission considers the period to commence on September 11, 2008, the date on which the Exchange submitted Amendment No. 1. PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 BILLING CODE 8010–01–P [Release No. 34–58518; File No. SR– NYSEArca–2008–94] Self-Regulatory Organizations; Notice of Filing of Proposed Rule Change by NYSE Arca, Inc. Amending NYSE Arca Equities Rules 5.1(b)(14) and 5.2(j)(2) To Permit the Listing of ELNs That Are Linked to Securities Issued by Companies Registered Under the Investment Company Act of 1940 Date: September 11, 2008. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 1 (the ‘‘Exchange Act’’) and Rule 19b–4 thereunder,2 notice is hereby given that on August 25, 2008, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’), through its wholly owned subsidiary, NYSE Arca Equities, Inc. (‘‘NYSE Arca Equities’’), 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 Exchange. 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 amend NYSE Arca Equities Rule 5.1(b)(14), the Exchange’s definition of Equity-Linked Notes (‘‘ELNs’’), and NYSE Arca Equities Rule 5.2(j)(2), the Exchange’s listing standards for ELNs, to permit the listing of ELNs that are linked to securities that are issued by companies registered under the Investment Company Act of 1940 (‘‘1940 Act’’) 3 16 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 80a–1. 1 15 E:\FR\FM\19SEN1.SGM 19SEN1

Agencies

[Federal Register Volume 73, Number 183 (Friday, September 19, 2008)]
[Notices]
[Pages 54444-54446]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-21948]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58549; File No. SR-NYSE-2008-80]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto Conforming Certain NYSE Rules to Changes to 
NYSE Incorporated Rules Recently Filed by the Financial Industry 
Regulatory Authority, Inc.

September 15, 2008.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on September 5, 2008, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I 
and II below, which Items have been prepared by the self-regulatory 
organization. On September 11, 2008, the Exchange filed Amendment No. 
1. The Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended, from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 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 certain New York Stock Exchange 
(``NYSE'' or the ``Exchange'') Rules to conform with proposed 
amendments to certain NYSE Incorporated Rules (defined below) recently 
filed by the Financial Industry Regulatory Authority, Inc. (``FINRA'') 
\4\ to reduce regulatory duplication and relieve firms that are members 
of both FINRA and the Exchange of conflicting or unnecessary regulatory 
burdens in the interim period

[[Page 54445]]

prior to completion of a consolidated FINRA rulebook.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 58533 (September 12, 
2008) (SR-FINRA-2008-036).
---------------------------------------------------------------------------

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 those 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 parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On July 30, 2007, NASD and NYSE Regulation, Inc. consolidated their 
member firm regulation operations into a combined organization, 
FINRA.\5\ As noted above, pursuant to its new regulatory 
responsibilities, FINRA recently filed proposed amendments to certain 
NYSE Incorporated Rules (and applicable Rule Interpretations). The NYSE 
hereby proposes to amend its version of these same rules to conform to 
the proposed changes filed by FINRA.
---------------------------------------------------------------------------

    \5\ Pursuant to Rule 17d-2 under the Securities Exchange Act of 
1934, as amended (the ``Exchange Act''), NYSE, NYSE Regulation, 
Inc., and NASD entered into an agreement (the ``Agreement'') to 
reduce regulatory duplication for firms that are members of FINRA 
and also members of NYSE on or after July 30, 2007 (``Dual 
Members''), by allocating to FINRA certain regulatory 
responsibilities for selected NYSE rules. The Agreement includes a 
list of all of those NYSE and NASD rules for which FINRA has assumed 
regulatory responsibilities (``Common Rules''). See Securities 
Exchange Act Release No. 56148 (July 26, 2007), 72 FR 42146 (August 
1, 2007) (Notice of Filing and Order Approving and Declaring 
Effective a Plan for the Allocation of Regulatory Responsibilities). 
The Common Rules include those NYSE rules that FINRA has 
incorporated into its rulebook (the ``NYSE Incorporated Rules''). 
See Securities Exchange Act Release No. 56147 (July 26, 2007), 72 FR 
42166 (August 1, 2007) (Notice of Filing and Order Granting 
Accelerated Approval of Proposed Rule Change to Incorporate Certain 
NYSE Rules Relating to Member Firm Conduct; File No. SR-NASD-2007-
054). Paragraph 2(b) of the 17d-2 Agreement sets forth procedures 
regarding proposed changes by either NYSE or FINRA to the substance 
of any of the Common Rules.
---------------------------------------------------------------------------

    The amendments proposed by FINRA fall into the following 
categories: \6\
---------------------------------------------------------------------------

    \6\ For more detail, see Securities Exchange Act Release No. 
58103 (July 3, 2008), 73 FR 40403 (July 14, 2008) (SR-FINRA-2008-
036).
---------------------------------------------------------------------------

     Replacing the term ``allied member'' with the newly 
defined category of ``principal executive'', and making corresponding 
technical changes as needed, in NYSE Incorporated Rules 2, 2A, 311-313, 
321, 342, 345, 345A, 346, 351-354, 401, 405, 407-410, 414, 424, 431, 
435, 440F, 440G, 477, 704, 705, 723, 724 and 791.
     Repositioning and consolidating certain NYSE Incorporated 
Rules. In order to consolidate all ``Buy-In'' requirements and 
procedures into one rule, FINRA proposes to reposition NYSE 
Incorporated Rule 283 and 285-290 as supplementary material in NYSE 
Incorporated Rule 282, and to make conforming changes to NYSE 
Incorporated Rule 134. FINRA also proposes to move certain provisions 
of NYSE Incorporated Rule 407 to Common Rule 346.
     Deleting NYSE Incorporated Rules that are obsolete or no 
longer applicable, including Rules 311(h) and 436.
     Eliminating certain provisions of NYSE Incorporated Rules 
that do not have a corresponding NASD equivalent, and therefore are 
deemed unnecessary rules, including the training requirements and 
registration for ``securities trader'' under Rule 345, Rule 345(b) and 
Rule 346(c).
     Additional amendments to further harmonize certain NYSE 
and NASD Rules, including NYSE Incorporated Rules 342.13(a), 346(e), 
346.10, 351.13, 352(c) and (d), and 408(a). In order to further 
harmonize NYSE Incorporated Rule 282 with NASD's 11000 Rule Series, 
FINRA also proposes to add as supplementary material the substance of 
NYSE Rule 140 and provisions from NASD Rule 11810.
     Deleting NYSE Incorporated Rules that are substantively 
duplicative of existing NASD Rules and procedures, including Rules 404, 
412 and 446. Similarly, FINRA proposes limiting application of NYSE 
Incorporated Rule 345(a) to securities lending representatives and 
supervisors only, since registered representatives and their 
supervisors are already addressed by NASD Rule 1031. For these 
particular proposed changes, the Exchange proposes to amend NYSE Rules 
404, 412, 446 and 345(a) to incorporate by reference the applicable 
NASD Rules that will be applied by FINRA going forward.\7\
---------------------------------------------------------------------------

    \7\ The Exchange recognizes that the proposed amendments to NYSE 
Rules 404, 412, 446 and 345(a) will remove these Rules from their 
status as Common Rules under the 17d-2 Agreement. Notwithstanding, 
FINRA will continue to provide regulatory services to the Exchange 
with respect to these Rules pursuant to the existing Regulatory 
Services Agreement, dated July 30, 2007, by and among FINRA, the 
Exchange and NYSE Regulation, Inc.
---------------------------------------------------------------------------

    The Exchange proposes to amend its version of the above-referenced 
NYSE Incorporated Rules to conform to FINRA's proposed rule changes. 
The Exchange proposes that the operative date of the proposed rule 
changes be the same as the operative date of FINRA's proposed 
amendments to the NYSE Incorporated Rules and Rule Interpretations.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
and furthers the objectives of Section 6(b)(5) \8\ of the Act, in that 
it is designed to prevent fraudulent and manipulative practices, to 
promote just and equitable principles of trade, to remove impediments 
to, and perfect the mechanisms of, a free and open market and a 
national market system, and, in general, to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule changes will provide 
greater harmonization between NYSE Incorporated Rules and NASD Rules of 
similar purpose, resulting in less burdensome and more efficient 
regulatory compliance for their members. Where proposed amendments do 
not entirely conform to existing NYSE Incorporated or NASD Rules or 
address a provision without a direct counterpart, the Exchange believes 
the standards the proposed amendments establish further the objectives 
of the Exchange Act by providing greater regulatory clarity and 
relieving unnecessary regulatory burdens in the interim period until a 
Consolidated Rulebook is completed.

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 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

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\ 
Because the

[[Page 54446]]

proposed rule change does not: (i) Significantly affect the protection 
of investors or the public interest; (ii) impose any significant burden 
on competition; and (iii) become operative prior to 30 days from the 
date on which it was filed, or such shorter time as the Commission may 
designate, if consistent with the protection of investors and the 
public interest, the proposed rule change has become effective pursuant 
to Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6)(iii) 
thereunder.\11\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the Exchange to give the Commission written 
notice of the Exchange's intent to file the proposed rule change 
along with a brief description and text of the proposed rule change, 
at least five business days prior to the date of filing of the 
proposed rule change, or such shorter time as designated by the 
Commission. The Exchange has satisfied the pre-filing requirement.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii), \13\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has 
requested that the Commission waive the 30-day operative delay so that 
the proposed rule change may become operative pursuant to Section 
19(b)(3)(A) and Rule 19b-4(f)(6) at the same time that FINRA's proposed 
amendments become operative.
---------------------------------------------------------------------------

    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
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    The purpose of the proposed rule change is to conform NYSE Rules to 
FINRA's proposed amendments to certain NYSE Incorporated Rules, in 
furtherance of the consolidation of the member firm regulations 
functions of NYSE Regulation and FINRA. NYSE requests that the 
operative date of the proposed rule change be the same as the operative 
date of FINRA's proposal in order to ensure that the NYSE Rules 
maintain their status as Common Rules under the 17d-2 Agreement. As 
provided in paragraph 2(b) of the Agreement, FINRA and NYSE will, 
absent a disagreement about the substance of a proposed rule change to 
one of the Common Rules, promptly propose conforming changes to ensure 
that such rules continue to be Common Rules under the Agreement. For 
this reason, the Commission designates that the proposed rule change 
has become operative as of September 12, 2008.\14\
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    \14\ For purposes only of waiving the operative delay for this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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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.\15\
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    \15\ 15 U.S.C. 78s(b)(3)(C). For purposes of calculating the 60-
day period within which the Commission may summarily abrogate the 
proposal, the Commission considers the period to commence on 
September 11, 2008, the date on which the Exchange submitted 
Amendment No. 1.
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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-NYSE-2008-80 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSE-2008-80. 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, 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 the Exchange. 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-NYSE-2008-80 and should be 
submitted on or before October 10, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-21948 Filed 9-18-08; 8:45 am]
BILLING CODE 8010-01-P