Self-Regulatory Organizations; Boston Stock Exchange, Incorporated; Notice of Filing of Proposed Rule Change To Amend By-Laws, 54648-54649 [E8-22014]

Download as PDF 54648 Federal Register / Vol. 73, No. 184 / Monday, September 22, 2008 / Notices to FINRA. Accordingly, the proposed Plan promotes efficiency by consolidating these regulatory functions in a single SRO based on the listing market for a stock, with regard to Common NYSE Members and Common FINRA Members. In addition, the Commission notes that the Plan provides that the costs for insider trading surveillance would be shared among the Participating Organizations based on their relative trade volume, subject to certain minimum payment amounts for smaller markets. Modifications to the fees assessed the Participating Organizations pursuant to the cost allocation methodologies established in the Plan do not require an amendment to the Plan; however, any modifications to the cost allocation methodologies would require approval by the Commission. The Commission believes that the Plan provides a reasonable method to allocate among the Parties expenses reasonably incurred by the SRO having regulatory responsibilities under the Plan.17 The Commission also notes that because under Rule 17d–2 regulatory responsibility may be allocated from one SRO to another SRO only for Common Members, the Participating Organizations have entered into two regulatory services agreements with NYSE Regulation and FINRA, respectively, to address investigation and enforcement of suspected insider trading involving members who are neither Common NYSE Members nor Common FINRA Members.18 The Commission is neither approving nor disapproving the terms of the regulatory services agreements. However, the Commission does note that under these regulatory services agreements the ultimate responsibility and primary liability for self-regulatory obligations would remain with each exchange and association, rather than the SRO retained to perform such functions. sroberts on PROD1PC70 with NOTICES IV. Conclusion This Order gives effect to the Plan filed with the Commission in File No. 4–566. The Parties shall notify all members affected by the Plan of their rights and obligations under the Plan. It is therefore ordered, pursuant to Section 17(d) of the Act,19 that the Plan in File No. 4–566 by and among Amex, BSE, CBOE, CHX, FINRA, ISE, NASDAQ, NSX, NYSE, NYSE Arca, 17 17 CFR 240.17d–2(b). only of the NYSE would be the responsibility of NYSE; members only of FINRA would be the responsibility of FINRA. 19 15 U.S.C. 78q(d). 18 Members VerDate Aug<31>2005 19:11 Sep 19, 2008 Jkt 214001 NYSE Regulation, and Phlx filed pursuant to Rule 17d–2 is hereby approved and declared effective. It is further ordered that the Participating Organizations are relieved of those regulatory responsibilities allocated to NYSE and FINRA under the Plan in File No. 4–566. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.20 Florence E. Harmon, Acting Secretary. [FR Doc. E8–22013 Filed 9–19–08; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58547; File No. SR–BSE– 2008–45] Self-Regulatory Organizations; Boston Stock Exchange, Incorporated; Notice of Filing of Proposed Rule Change To Amend By-Laws September 15, 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 September 5, 2008, the Boston Stock Exchange (the ‘‘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 Exchange. 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 its by-laws to make certain changes that the Exchange committed to make in SR– BSE–2008–23.3 The text of the proposed rule change is available from the principal office of the Exchange, at the Commission’s Public Reference Room, and is also available at http:// nasdaqtrader.com/Trader.aspx?id= Boston_Stock_Exchange. 20 17 CFR 200.30–3(a)(34). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Securities Exchange Act Release No. 58324 (August 7, 2008), 73 FR 46936 (August 12, 2008); Securities Exchange Act Release No. 57757 (May 1, 2008), 73 FR 26159 (May 8, 2008) (SR–BSE–2008– 23). 1 15 PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 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 On August 29, 2008, the Exchange was acquired by The NASDAQ OMX Group, Inc. (‘‘NASDAQ OMX’’). In SR– BSE–2008–23, the Exchange’s filing seeking approval of this acquisition, the Exchange committed that it would, immediately following closing of the acquisition, seek Board of Directors and Commission approval for several changes to its By-Laws. The changes, which were requested by Commission staff, could not be included in SR–BSE– 2008–23 because Article XX of the Exchange’s former Constitution, which was replaced by the new By-Laws at the closing, provided that the Exchange’s members must approve amendments to the Exchange’s Constitution. The Exchange’s members voted, on December 7, 2007, to approve the ByLaws as originally submitted in SR– BSE–2008–23, and it would have been impracticable and unduly expensive to seek a second member vote for approval of these additional changes prior to closing. The changes in question are as follows: • In Article I, the Exchange is amending the definition of ‘‘Voting Date’’ to make it clear that the Exchange Board of Directors must annually select a Voting Date for the selection of Member Representative Directors, although a vote will actually occur on that date only if members have nominated candidates for election other than those nominated by the Exchange’s Member Nominating Committee. Accordingly, the amended definition reads: ‘‘ ‘Voting Date’ means the date selected by the Board on an annual basis, on which Exchange Members may vote with respect to Member Representative Directors in the event of a Contested Vote.’’ E:\FR\FM\22SEN1.SGM 22SEN1 Federal Register / Vol. 73, No. 184 / Monday, September 22, 2008 / Notices • In order to limit the influence that a single affiliated group of members might exercise over the Exchange, Section 4.4 of the By-Laws is being amended to provide that in a contested election for Member Representative Directors, an Exchange Member, either alone or together with its affiliates, may not cast votes representing more than 20% of the votes cast for a candidate, and any votes cast by the Exchange Member, either alone or together with its affiliates, in excess of such 20% limitation shall be disregarded. • The Exchange is amending Section 4.14 of the By-Laws to make it clear that the Exchange’s Nominating Committee must nominate the person nominated by Boston Options Exchange Regulation LLC’s Nominating Committee for service on the Exchange Board as a representative of participants in the Boston Options Exchange unless that person is not eligible for service under Section 4.3 of the By-Laws (as would be the case, for example, if the nominee was subject to a statutory disqualification). Similarly, the Exchange is amending Section 3.1 of the By-Laws to make it clear that NASDAQ OMX, as the sole stockholder of the Exchange, shall vote for the election of the director candidates nominated or voted on through the processes established by Article IV of the ByLaws, except in the case of a person not eligible for service under Section 4.3 of the By-Laws. sroberts on PROD1PC70 with NOTICES 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,4 in general, and with Section 6(b)(1) and (b)(5) of the Act,5 in particular, in that the proposal enables the Exchange to be so organized as to have the capacity to be able to carry out the purposes of the Act and to comply with and enforce compliance by Exchange Members and persons associated with Exchange Members with provisions of the Act, the rules and regulations thereunder, and the rules of the Exchange; and 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 regulating, clearing, settling, processing information with respect to, and 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 4 15 5 15 U.S.C. 78f. U.S.C. 78f(b)(1), (5). VerDate Aug<31>2005 19:11 Sep 19, 2008 Jkt 214001 general, to protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange 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, as amended. 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 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 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–BSE–2008–45 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–2008–45. 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/ Frm 00096 Fmt 4703 Sfmt 4703 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– 2008–45 and should be submitted on or before October 14, 2008. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.6 Florence E. Harmon, Acting Secretary. [FR Doc. E8–22014 Filed 9–19–08; 8:45 am] BILLING CODE 8010–01–P 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: PO 00000 54649 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58532; File No. SR–NASD– 2007–041] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc. (f/k/a National Association of Securities Dealers, Inc.); Order Approving Proposed Rule Change, as Modified by Amendment No. 2, To Amend the Minimum PriceImprovement Standards Set Forth in NASD Interpretive Material (‘‘IM’’) 2110–2 September 12, 2008. I. Introduction On June 27, 2007, the National Association of Securities Dealers, Inc. (‘‘NASD’’) (n/k/a Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’)) 1 6 17 CFR 200.30–3(a)(12). July 26, 2007, the Commission approved a proposed rule change filed by the NASD to amend the NASD’s Certificate of Incorporation to reflect its name change to Financial Industry Regulatory Authority, Inc., or FINRA, in connection with the 1 On E:\FR\FM\22SEN1.SGM Continued 22SEN1

Agencies

[Federal Register Volume 73, Number 184 (Monday, September 22, 2008)]
[Notices]
[Pages 54648-54649]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-22014]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58547; File No. SR-BSE-2008-45]


Self-Regulatory Organizations; Boston Stock Exchange, 
Incorporated; Notice of Filing of Proposed Rule Change To Amend By-Laws

September 15, 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 September 5, 2008, the Boston Stock Exchange (the ``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 Exchange. The Commission is publishing 
this notice to solicit comments on the proposed rule from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its by-laws to make certain changes 
that the Exchange committed to make in SR-BSE-2008-23.\3\ The text of 
the proposed rule change is available from the principal office of the 
Exchange, at the Commission's Public Reference Room, and is also 
available at http://nasdaqtrader.com/Trader.aspx?id=Boston_Stock_
Exchange.
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    \3\ Securities Exchange Act Release No. 58324 (August 7, 2008), 
73 FR 46936 (August 12, 2008); Securities Exchange Act Release No. 
57757 (May 1, 2008), 73 FR 26159 (May 8, 2008) (SR-BSE-2008-23).
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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
    On August 29, 2008, the Exchange was acquired by The NASDAQ OMX 
Group, Inc. (``NASDAQ OMX''). In SR-BSE-2008-23, the Exchange's filing 
seeking approval of this acquisition, the Exchange committed that it 
would, immediately following closing of the acquisition, seek Board of 
Directors and Commission approval for several changes to its By-Laws. 
The changes, which were requested by Commission staff, could not be 
included in SR-BSE-2008-23 because Article XX of the Exchange's former 
Constitution, which was replaced by the new By-Laws at the closing, 
provided that the Exchange's members must approve amendments to the 
Exchange's Constitution. The Exchange's members voted, on December 7, 
2007, to approve the By-Laws as originally submitted in SR-BSE-2008-23, 
and it would have been impracticable and unduly expensive to seek a 
second member vote for approval of these additional changes prior to 
closing. The changes in question are as follows:
     In Article I, the Exchange is amending the definition of 
``Voting Date'' to make it clear that the Exchange Board of Directors 
must annually select a Voting Date for the selection of Member 
Representative Directors, although a vote will actually occur on that 
date only if members have nominated candidates for election other than 
those nominated by the Exchange's Member Nominating Committee. 
Accordingly, the amended definition reads: `` `Voting Date' means the 
date selected by the Board on an annual basis, on which Exchange 
Members may vote with respect to Member Representative Directors in the 
event of a Contested Vote.''

[[Page 54649]]

     In order to limit the influence that a single affiliated 
group of members might exercise over the Exchange, Section 4.4 of the 
By-Laws is being amended to provide that in a contested election for 
Member Representative Directors, an Exchange Member, either alone or 
together with its affiliates, may not cast votes representing more than 
20% of the votes cast for a candidate, and any votes cast by the 
Exchange Member, either alone or together with its affiliates, in 
excess of such 20% limitation shall be disregarded.
     The Exchange is amending Section 4.14 of the By-Laws to 
make it clear that the Exchange's Nominating Committee must nominate 
the person nominated by Boston Options Exchange Regulation LLC's 
Nominating Committee for service on the Exchange Board as a 
representative of participants in the Boston Options Exchange unless 
that person is not eligible for service under Section 4.3 of the By-
Laws (as would be the case, for example, if the nominee was subject to 
a statutory disqualification). Similarly, the Exchange is amending 
Section 3.1 of the By-Laws to make it clear that NASDAQ OMX, as the 
sole stockholder of the Exchange, shall vote for the election of the 
director candidates nominated or voted on through the processes 
established by Article IV of the By-Laws, except in the case of a 
person not eligible for service under Section 4.3 of the By-Laws.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act,\4\ in general, and with 
Section 6(b)(1) and (b)(5) of the Act,\5\ in particular, in that the 
proposal enables the Exchange to be so organized as to have the 
capacity to be able to carry out the purposes of the Act and to comply 
with and enforce compliance by Exchange Members and persons associated 
with Exchange Members with provisions of the Act, the rules and 
regulations thereunder, and the rules of the Exchange; and 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 regulating, clearing, settling, 
processing information with respect to, and 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.
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    \4\ 15 U.S.C. 78f.
    \5\ 15 U.S.C. 78f(b)(1), (5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange 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, as amended.

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

    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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-BSE-2008-45 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-2008-45. 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 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-
2008-45 and should be submitted on or before October 14, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\6\
---------------------------------------------------------------------------

    \6\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-22014 Filed 9-19-08; 8:45 am]
BILLING CODE 8010-01-P