Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change to Discontinue Policy of Prohibiting Transfer Agents from Charging Fees for Issuing Stock Certificates, 79531-79533 [E8-30784]
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Federal Register / Vol. 73, No. 249 / Monday, December 29, 2008 / Notices
measures to assist funds members in
validating their data once it is in the
Profile database by developing reports
that note probable inconsistencies
among related data fields, by arranging
for free access by fund members to a
vendor tool that verifies Profile data,
and by reaching out to fund members in
the form of personal contacts and an online web demonstration on populating
data into the Profile database.
Consistent with its efforts to expand
Profile’s capabilities as a comprehensive
and accurate source for the mutual fund
distribution industry, NSCC is now
proposing to amend its rules to add an
agreement that requires NSCC fund
members to have taken reasonable steps
to validate the accuracy of their data
they submit to the Profile database. This
agreement is not intended to be either
a basis for independent legal rights
against the fund member or is any third
party intended or permitted to rely upon
it as a representation to a third party or
upon which a third-party can base any
legal rights. NSCC requires similar
agreements from its members elsewhere
in its Rules and in its membership
agreement, such as the agreement
required of a fund member in Section 2
of Rule 51 to not submit a transaction
through NSCC’s Mutual Fund Services
in contravention of any applicable
regulatory requirements.
dwashington3 on PROD1PC60 with NOTICES
2. Statutory Basis
NSCC believes the proposed rule
change is consistent with the
requirements of Section 17A of the Act,
as amended,5 and the rules and
regulations thereunder because the
proposed rule change will promote the
prompt and accurate clearance and
settlement of securities transactions by
modifying a NSCC service in order to
reduce the inherent risks associated
with securities certificates. Since
NSCC’s Profile database is widely used
by mutual fund distributors in
processing the distribution of mutual
fund shares, the proposed rule change
should facilitate the prompt and
Investment Company Institute, in response to the
NASD examination findings in which it was
discovered that investors frequently failed to
receive appropriate breakpoint discounts in frontend sales load mutual fund transactions.
Recommendation (B) of the report stated that
NSCC’s Profile database should be expanded to
include breakpoint aggregation terms and rules for
all fund families and should include identification
of both link-eligible products (for example,
retirement plans, annuities, and insurance products
and college savings plans with mutual fund
holdings). The Report also noted that for this
database to be effective, it must also be
comprehensive. Accordingly, mutual funds must
fully and accurately populate the database and must
update the database on a timely basis.
5 15 U.S.C. 78q–1.
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Jkt 217001
accurate clearance and settlement of
securities transactions by assisting in
the overall processing efficiency of
mutual fund transactions and reducing
processing difficulties resulting from
incomplete or inaccurate information.
(B) Self-Regulatory Organization’s
Statement on Burden on Competition
NSCC 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
NSCC has neither solicited nor
received written comments on the
proposed rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within thirty-five 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 ninety 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
79531
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
Section, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3:30
p.m. Copies of such filings also will be
available for inspection and copying at
the principal office of NSCC and on
NSCC’s Web site, https://www.dtcc.com.
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–NSCC–2008–08 and should
be submitted on or before January 20,
2009.
For the Commission by the Division of
Trading and Markets, pursuant to delegated
authority.6
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–30783 Filed 12–24–08; 8:45 am]
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:
BILLING CODE 8011–01–P
Electronic Comments
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing of Proposed Rule Change to
Discontinue Policy of Prohibiting
Transfer Agents from Charging Fees
for Issuing Stock Certificates
• 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–NSCC–2008–08 in 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–NSCC–2008–08. This file
number should be included on the
subject line if e-mail is used. To help the
PO 00000
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59106; File No. SR–NYSE–
2008–112]
December 16, 2008.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 notice is hereby given that on
October 30, 2008, New York Stock
Exchange, LLC (‘‘NYSE’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) proposed rule change
No. SR–NYSE–2008–112. The
6 17
1 15
E:\FR\FM\29DEN1.SGM
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
29DEN1
79532
Federal Register / Vol. 73, No. 249 / Monday, December 29, 2008 / Notices
Commission is publishing this notice to
solicit comments from interested parties
on the proposed rule change as
described in Items I, II, and III below,
which items have been prepared
primarily by the NYSE.2
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
NYSE proposes to discontinue its
policy of prohibiting transfer agents for
listed companies from charging fees for
the issuance of stock certificates.
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
NYSE 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. NYSE has prepared
summaries, set forth in sections (A), (B),
and (C) below, of the most significant
aspects of these statements.3
(A) Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
dwashington3 on PROD1PC60 with NOTICES
1. Purpose
NYSE proposes to discontinue its
long-standing, unwritten policy of
prohibiting transfer agents of NYSE
listed companies from charging for the
issuance of stock certificates.
The securities industry is moving
towards eliminating the use of physical
certificates (i.e., dematerialization) by
encouraging investors to hold securities
positions in book-entry form either in
street name at a broker-dealer or through
the Direct Registration System (‘‘DRS’’).
DRS allows investors to have securities
directly registered in book-entry form on
the records of the issuer or its transfer
agent without having a certificate
issued. DRS also allows those securities
positions to be electronically transferred
to a broker-dealer in order to effect a
transaction without the risk and delay
associated with the use of paper
certificates. Since March 31, 2008,
Section 501.00 of NYSE’s Listed
Company Manual has required that all
securities listed on the NYSE must be
eligible for participation in DRS.4
2 The exact text of the NYSE’s proposed rule
change can be found at https://www.nyse.com.
3 The Commission has modified portions of the
text of the summaries prepared by the NYSE.
4 Section 501.00 requires listed securities to be
eligible for a direct registration system operated by
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13:19 Dec 24, 2008
Jkt 217001
Approximately 2,428 NYSE listed
securities currently participate in DRS.
To further the industry’s efforts to
dematerialize, the Securities Industry
and Financial Markets Association
(‘‘SIFMA’’), which is one of the leaders
in the movement towards
dematerialization, recently sent a letter
to the NYSE requesting that the NYSE
discontinue its prohibition of charging
fees in connection with the issuance of
securities certificates (‘‘SIFMA Letter’’).5
SIFMA noted that almost 75% of
physical certificates deposited by
broker-dealers and bank custodians at
The Depository Trust Company
(‘‘DTC’’), a registered clearing agency
that is the primary custodian of
securities traded in the United States,
were issued within the last six months.
SIFMA believes that these recent
deposits indicate that DTC participants
(i.e., broker-dealers and banks) are
providing physical certificates to their
customers only to have the securities
moved back into street name in a short
period of time. In SIFMA’s view, this
activity results in unnecessary expense
and in inherent risk that the certificates
may be lost, destroyed, or stolen. A
SIFMA survey concluded that more
than 1.2 million certificates need to be
replaced because of loss, destruction, or
theft each year at an approximate cost
to the transfer agents of $65 million.6
NYSE believes that securityholders
derive no apparent benefit from
continuing to hold their securities in
certificated form rather than in
uncertificated form in street name or
through DRS and that the inability of
the transfer agents to charge for the
issuance of securities certificates
imposes a considerable cost on issuers
and transfer agents. Therefore, NYSE
proposes to discontinue its prohibition
of charging fees for the issuance of new
certificates. Allowing transfer agents to
a clearing agency, as defined in Section 3(a)(23) of
the Act, that is registered with the Commission
pursuant to Section 17A(b)(2) of the Act. While
currently the DRS administered by The Depository
Trust Company is the only direct registration
system offered by a registered clearing agency,
Section 501.00 provides issuers with the option of
using another qualified direct registration system if
one should exist in the future. Section 501.00 does
not extend to securities which are specifically
permitted under that chapter to be and which are
book-entry only. NYSE will waive the application
of Section 501.00 to any listed company that is a
foreign private issuer that submits to NYSE a letter
from an independent home country counsel
certifying that a home country law or regulation
prohibits such compliance.
5 Letter to Stephen Walsh, Vice President, NYSE
Euronext, from Lawrence Morillo, SIFMA
Operations Legal & Regulatory Sub-Committee
Chair (August 26, 2008).
6 ‘‘Securities Industry Immobilization &
Dematerialization Implementation Guide—The
Phase-Out of the Stock Certificate’’ (SIFMA, 2008).
PO 00000
Frm 00096
Fmt 4703
Sfmt 4703
charge for the issuance of certificates
should not only shift the cost of the
issuance of certificates from the issuers
and transfer agents to the requesting
securityholders but should also have the
added effect of encouraging more
securityholders to hold their securities
in street name or through DRS. This
should further the movement to
dematerialization. NYSE listed
companies that want their investors to
continue to have access to the free
issuance of new certificates will be able
to ensure the continuation of this
practice by modifying their contractual
arrangements with their transfer agents.
NYSE believes that the proposal will
help make the securities markets more
safe and efficient by encouraging the
dematerialization of securities. NYSE
also believes that the proposal is
consistent with the protection of
investors and the public interest
because holding a securities position in
street name or through DRS provides
investors with the ability to hold their
securities in a safe and cost-effective
manner without incurring the fees
associated with the issuance and
processing of securities certificates.
2. Statutory Basis
NYSE believes that the proposed rule
change is consistent with Section 6(b) of
the Act,7 in general, and particularly
furthers the objectives of Section 6(b)(5)
of the Act 8 in that it is designed 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. In particular, NYSE
believes that the proposal removes
impediments to and perfects the
mechanism of a free and open market
and a national market system in that it
encourages the dematerialization of
securities, which should improve the
process of transferring securities in the
public markets. NYSE also believes that
the proposal is consistent with the
protection of investors and the public
interest in that holding securities in or
through street name and DRS provides
a better alternative to holding securities
in certificated form by providing
investors with the ability to hold their
securities in a safe and cost-effective
manner without incurring the fees
7 15
8 15
E:\FR\FM\29DEN1.SGM
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
29DEN1
Federal Register / Vol. 73, No. 249 / Monday, December 29, 2008 / Notices
associated with the issuance of
certificates.
(B) Self-Regulatory Organization’s
Statement on Burden on Competition
NYSE 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
NYSE has neither solicited nor
received written comments on the
proposed rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within thirty-five 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 ninety 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
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
Section, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3:30
p.m. Copies of such filings also will be
available for inspection and copying at
the principal office of NYSE and on the
NYSE’s Web site, https://www.nyse.com.
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–NYSE–2008–112 and
should be submitted on or before
January 20, 2009. For the Commission
by the Division of Trading and Markets,
pursuant to delegated authority.9
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–30784 Filed 12–24–08; 8:45 am]
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:
BILLING CODE 8011–01–P
Electronic Comments
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by New York
Stock Exchange LLC That the
$8,000,000 Annual Trading Floor
Regulatory Fee Allocated Among the
Designated Market Maker Firms,
Formerly Referred to as the ‘‘Specialist
Trading Floor Regulatory Fee,’’ Be
Reduced by 50% for 2008, and
Eliminated Thereafter
• 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–NYSE–2008–112 in the
subject line.
dwashington3 on PROD1PC60 with NOTICES
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–NYSE–2008–112. 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
VerDate Aug<31>2005
13:19 Dec 24, 2008
Jkt 217001
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59112; File No. SR–NYSE–
2008–125]
December 17, 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 December
15, 2008, New York Stock Exchange
9 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.
1 15
PO 00000
Frm 00097
Fmt 4703
Sfmt 4703
79533
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. 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 that the
$8,000,000 annual trading floor
regulatory fee allocated among the
Designated Market Maker firms
(‘‘DMMs’’ or ‘‘firms’’),4 formerly referred
to as the ‘‘specialist trading floor
regulatory fee,’’ be reduced by 50% for
2008, and eliminated thereafter.
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
Effective retroactively to July 1, 2008,
the Exchange proposes that the
$8,000,000 annual trading floor
regulatory fee allocated among the
DMMs be reduced by 50% for 2008 (i.e.,
$4,000,000), and eliminated thereafter.
The purpose of the trading floor
regulatory fee has been to defray the
costs incurred by the Exchange in
connection with the monitoring of
trading floor activity by the Exchange’s
Market Surveillance Division. Effective
January 1, 2008, the Exchange reduced
this fee from $16,000,000 to $8,000,000.
4 See Securities Exchange Act Release No. 58845
(October 24, 2008) 73 FR 64379 (October 29, 2008)
(SR–NYSE–2008–46). In this rule filing, which
created a new market model for the Exchange, the
role of the specialist was altered in certain respects
and the term ‘‘specialist’’ was replaced with the
term ‘‘Designated Market Maker (‘DMM’).’’
Therefore, the annual trading floor regulatory fee
previously paid by ‘‘specialist’’ firms will be
referred to as the ‘‘Designated Market Maker’’
annual trading floor regulatory fee.
E:\FR\FM\29DEN1.SGM
29DEN1
]]>Agencies
[Federal Register Volume 73, Number 249 (Monday, December 29, 2008)]
[Notices]
[Pages 79531-79533]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-30784]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-59106; File No. SR-NYSE-2008-112]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing of Proposed Rule Change to Discontinue Policy of
Prohibiting Transfer Agents from Charging Fees for Issuing Stock
Certificates
December 16, 2008.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on October 30, 2008, New York
Stock Exchange, LLC (``NYSE'') filed with the Securities and Exchange
Commission (``Commission'') proposed rule change No. SR-NYSE-2008-112.
The
[[Page 79532]]
Commission is publishing this notice to solicit comments from
interested parties on the proposed rule change as described in Items I,
II, and III below, which items have been prepared primarily by the
NYSE.\2\
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ The exact text of the NYSE's proposed rule change can be
found at https://www.nyse.com.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
NYSE proposes to discontinue its policy of prohibiting transfer
agents for listed companies from charging fees for the issuance of
stock certificates.
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 NYSE 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. NYSE has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of these
statements.\3\
---------------------------------------------------------------------------
\3\ The Commission has modified portions of the text of the
summaries prepared by the NYSE.
---------------------------------------------------------------------------
(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
NYSE proposes to discontinue its long-standing, unwritten policy of
prohibiting transfer agents of NYSE listed companies from charging for
the issuance of stock certificates.
The securities industry is moving towards eliminating the use of
physical certificates (i.e., dematerialization) by encouraging
investors to hold securities positions in book-entry form either in
street name at a broker-dealer or through the Direct Registration
System (``DRS''). DRS allows investors to have securities directly
registered in book-entry form on the records of the issuer or its
transfer agent without having a certificate issued. DRS also allows
those securities positions to be electronically transferred to a
broker-dealer in order to effect a transaction without the risk and
delay associated with the use of paper certificates. Since March 31,
2008, Section 501.00 of NYSE's Listed Company Manual has required that
all securities listed on the NYSE must be eligible for participation in
DRS.\4\ Approximately 2,428 NYSE listed securities currently
participate in DRS.
---------------------------------------------------------------------------
\4\ Section 501.00 requires listed securities to be eligible for
a direct registration system operated by a clearing agency, as
defined in Section 3(a)(23) of the Act, that is registered with the
Commission pursuant to Section 17A(b)(2) of the Act. While currently
the DRS administered by The Depository Trust Company is the only
direct registration system offered by a registered clearing agency,
Section 501.00 provides issuers with the option of using another
qualified direct registration system if one should exist in the
future. Section 501.00 does not extend to securities which are
specifically permitted under that chapter to be and which are book-
entry only. NYSE will waive the application of Section 501.00 to any
listed company that is a foreign private issuer that submits to NYSE
a letter from an independent home country counsel certifying that a
home country law or regulation prohibits such compliance.
---------------------------------------------------------------------------
To further the industry's efforts to dematerialize, the Securities
Industry and Financial Markets Association (``SIFMA''), which is one of
the leaders in the movement towards dematerialization, recently sent a
letter to the NYSE requesting that the NYSE discontinue its prohibition
of charging fees in connection with the issuance of securities
certificates (``SIFMA Letter'').\5\ SIFMA noted that almost 75% of
physical certificates deposited by broker-dealers and bank custodians
at The Depository Trust Company (``DTC''), a registered clearing agency
that is the primary custodian of securities traded in the United
States, were issued within the last six months. SIFMA believes that
these recent deposits indicate that DTC participants (i.e., broker-
dealers and banks) are providing physical certificates to their
customers only to have the securities moved back into street name in a
short period of time. In SIFMA's view, this activity results in
unnecessary expense and in inherent risk that the certificates may be
lost, destroyed, or stolen. A SIFMA survey concluded that more than 1.2
million certificates need to be replaced because of loss, destruction,
or theft each year at an approximate cost to the transfer agents of $65
million.\6\
---------------------------------------------------------------------------
\5\ Letter to Stephen Walsh, Vice President, NYSE Euronext, from
Lawrence Morillo, SIFMA Operations Legal & Regulatory Sub-Committee
Chair (August 26, 2008).
\6\ ``Securities Industry Immobilization & Dematerialization
Implementation Guide--The Phase-Out of the Stock Certificate''
(SIFMA, 2008).
---------------------------------------------------------------------------
NYSE believes that securityholders derive no apparent benefit from
continuing to hold their securities in certificated form rather than in
uncertificated form in street name or through DRS and that the
inability of the transfer agents to charge for the issuance of
securities certificates imposes a considerable cost on issuers and
transfer agents. Therefore, NYSE proposes to discontinue its
prohibition of charging fees for the issuance of new certificates.
Allowing transfer agents to charge for the issuance of certificates
should not only shift the cost of the issuance of certificates from the
issuers and transfer agents to the requesting securityholders but
should also have the added effect of encouraging more securityholders
to hold their securities in street name or through DRS. This should
further the movement to dematerialization. NYSE listed companies that
want their investors to continue to have access to the free issuance of
new certificates will be able to ensure the continuation of this
practice by modifying their contractual arrangements with their
transfer agents.
NYSE believes that the proposal will help make the securities
markets more safe and efficient by encouraging the dematerialization of
securities. NYSE also believes that the proposal is consistent with the
protection of investors and the public interest because holding a
securities position in street name or through DRS provides investors
with the ability to hold their securities in a safe and cost-effective
manner without incurring the fees associated with the issuance and
processing of securities certificates.
2. Statutory Basis
NYSE believes that the proposed rule change is consistent with
Section 6(b) of the Act,\7\ in general, and particularly furthers the
objectives of Section 6(b)(5) of the Act \8\ in that it is designed 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. In
particular, NYSE believes that the proposal removes impediments to and
perfects the mechanism of a free and open market and a national market
system in that it encourages the dematerialization of securities, which
should improve the process of transferring securities in the public
markets. NYSE also believes that the proposal is consistent with the
protection of investors and the public interest in that holding
securities in or through street name and DRS provides a better
alternative to holding securities in certificated form by providing
investors with the ability to hold their securities in a safe and cost-
effective manner without incurring the fees
[[Page 79533]]
associated with the issuance of certificates.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
NYSE 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
NYSE has neither solicited nor received written comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within thirty-five 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 ninety 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-NYSE-2008-112 in 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-NYSE-2008-112. 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 Section, 100 F Street,
NE., Washington, DC 20549, on official business days between the hours
of 10 a.m. and 3:30 p.m. Copies of such filings also will be available
for inspection and copying at the principal office of NYSE and on the
NYSE's Web site, https://www.nyse.com. 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-NYSE-2008-112 and should be submitted on
or before January 20, 2009. For the Commission by the Division of
Trading and Markets, pursuant to delegated authority.\9\
Florence E. Harmon,
Acting Secretary.
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\9\ 17 CFR 200.30-3(a)(12).
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[FR Doc. E8-30784 Filed 12-24-08; 8:45 am]
BILLING CODE 8011-01-P
