Self-Regulatory Organizations; New York Stock Exchange LLC; Order Approving Proposed Rule Change Deleting NYSE Rule 446 and Adopting New Rule 4370 To Correspond With Rule Changes Filed by the Financial Industry Regulatory Authority, Inc., 25902-25904 [2010-10953]
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25902
Federal Register / Vol. 75, No. 89 / Monday, May 10, 2010 / Notices
allocating to FINRA certain regulatory
responsibilities for certain NYSE rules
and rule interpretations (‘‘FINRA
Incorporated NYSE Rules’’). The
Exchange became a party to the
Agreement effective December 15,
2008.7
As part of its effort to reduce
regulatory duplication and relieve firms
that are members of FINRA, NYSE and
NYSE Amex of conflicting or
unnecessary regulatory burdens, FINRA
is now engaged in the process of
reviewing and amending the NASD and
FINRA Incorporated NYSE Rules in
order to create a consolidated FINRA
rulebook.8
In 2008, FINRA deleted FINRA
Incorporated NYSE Rule 446 (Business
Continuity and Contingency Plans) as
substantively duplicative of NASD
Rules 3510 (Business Continuity Plans)
and 3520 (Emergency Contact
Information).9 Correspondingly, the
Exchange amended Rule 446—NYSE
Amex Equities (Business Continuity and
Contingency Plans) to remove the
existing text and incorporate NASD
Rules 3510 and 3520 by reference.10
Subsequently, FINRA adopted, subject
to certain amendments, NASD Rules
3510 and 3520 as consolidated FINRA
Rule 4370 (Business Continuity Plans
and Emergency Contact Information).11
The Exchange correspondingly
proposes to delete Rule 446—NYSE
Amex Equities and replace it with
proposed Rule 4370—NYSE Amex
Equities, which is substantially similar
to the new FINRA Rule.12 The Exchange
jlentini on DSKJ8SOYB1PROD with NOTICES
7 See
Securities Exchange Act Release Nos. 56148
(July 26, 2007), 72 FR 42146 (August 1, 2007) (order
approving the Agreement); 56147 (July 26, 2007), 72
FR 42166 (August 1, 2007) (SR–NASD–2007–054)
(order approving the incorporation of certain NYSE
Rules as ‘‘Common Rules’’); and 60409 (July 30,
2009), 74 FR 39353 (August 6, 2009) (order
approving the amended and restated Agreement,
adding NYSE Amex LLC as a party). Paragraph 2(b)
of the Agreement sets forth procedures regarding
proposed changes by FINRA, NYSE or NYSE Amex
to the substance of any of the Common Rules.
8 FINRA’s rulebook currently has three sets of
rules: (1) NASD Rules, (2) FINRA Incorporated
NYSE Rules, and (3) consolidated FINRA Rules.
The FINRA Incorporated NYSE Rules apply only to
those members of FINRA that are also members of
the NYSE, while the consolidated FINRA Rules
apply to all FINRA members. For more information
about the FINRA rulebook consolidation process,
see FINRA Information Notice, March 12, 2008.
9 See Securities Exchange Act Release No. 58533
(September 12, 2008), 73 FR 54652 (September 22,
2008) (order approving SR–FINRA–2008–036).
10 See Securities Exchange Act Release No. 59022
(November 26, 2008), 73 FR 73683 (December 3,
2008) (order approving SR–NYSEALTR–2008–10).
11 See Release No. 34–60534, supra note 4.
12 New York Stock Exchange LLC submitted a
companion rule filing amending its rules in
accordance with FINRA’s rule changes, which the
Commission has approved. See Securities Exchange
Act Release No. 62015 (April 30, 2010)(SR–NYSE–
2010–23).
VerDate Mar<15>2010
17:18 May 07, 2010
Jkt 220001
states that the purpose of this is to
harmonize the NYSE Amex Equities
Rules with the consolidated FINRA
Rules. The Exchange states that, as
proposed, Rule 4370—NYSE Amex
Equities adopts the same language as
FINRA Rule 4370, except for
substituting for or adding to, as needed,
the term ‘‘member organization’’ for the
term ‘‘member,’’ and making
corresponding technical changes that
reflect the difference between NYSE
Amex’s and FINRA’s membership
structures. The Exchange also states
that, in paragraph (f)(2) to proposed
NYSE Rule 4370—NYSE Amex Equities,
the Exchange has added a crossreference to Rule 416A—NYSE Amex
Equities to ensure that those Exchange
members and member organizations that
are not FINRA members are required to
update the contact information for
emergency personnel in accordance
with NYSE Amex Equities Rules.
The Exchange also proposes to add
Supplementary Material .01 to Rule
4370—NYSE Amex Equities to provide
that, for the purposes of the rule, the
term ‘‘associated person’’ shall have the
same meaning as the terms ‘‘person
associated with a member’’ or
‘‘associated person of a member’’ as
defined in Article I (rr) of the FINRA ByLaws. The Exchange states that this
change is necessary to ensure that both
proposed Rule 4370—NYSE Amex
Equities and FINRA Rule 4370 are fully
harmonized.
Finally, the Exchange proposes that
the effective date for the proposed rule
changes be retroactive to December 14,
2009, the same effective date for the
corresponding FINRA rule changes.13
As a result, there should be no
regulatory gaps between the FINRA and
NYSE Amex Equities Rules and that, as
applicable, the NYSE Amex Equities
Rules would maintain their status as
Common Rules under the Agreement.14
IV. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange. Specifically, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,15 which requires,
among other things, that the rules of a
13 See FINRA Regulatory Notice 09–60 (October
15, 2009).
14 As provided in paragraph 2(b) of the
Agreement, FINRA and NYSE will amend the list
of Common Rules to conform to the rule changes
proposed herein.
15 15 U.S.C. 78f(b)(5).
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Frm 00074
Fmt 4703
Sfmt 4703
national securities exchange be
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, 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.16
The Commission believes that the
proposed rule change provides greater
harmonization between NYSE Amex
Equities Rules and FINRA Rules of
similar purpose, resulting in less
burdensome and more efficient
regulatory compliance for NYSE Amex
members. In addition, the Commission
believes that retroactive application of
the proposed rule change to December
14, 2009, is appropriate to assure that
there are no regulatory gaps between
FINRA and NYSE Amex Equities Rules,
and that, as applicable, the NYSE Amex
Rules would maintain their status as
Common Rules under the Agreement.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,17 that the
proposed rule change (SR–NYSEAmex–
2010–26), be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–10952 Filed 5–7–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62015; File No. SR–NYSE–
2010–23]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Order
Approving Proposed Rule Change
Deleting NYSE Rule 446 and Adopting
New Rule 4370 To Correspond With
Rule Changes Filed by the Financial
Industry Regulatory Authority, Inc.
April 30, 2010.
I. Introduction
On March 11, 2010, the New York
Stock Exchange LLC (‘‘NYSE’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) 1 of the Securities Exchange Act
16 In approving the proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition and capital
formation. See 15 U.S.C. 78c(f).
17 15 U.S.C. 78s(b)(2).
18 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
E:\FR\FM\10MYN1.SGM
10MYN1
Federal Register / Vol. 75, No. 89 / Monday, May 10, 2010 / Notices
of 1934 (the ‘‘Act’’),2 and Rule 19b–4
thereunder,3 a proposed rule change to
delete NYSE Rule 446 and adopt new
Rule 4370 to correspond with rule
changes filed by the Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’)
and approved by the Commission.4 The
proposed rule change was published for
comment in the Federal Register on
March 26, 2010.5 The Commission
received no comments on the proposal.
This order approves the proposed rule
change.
II. Description of the Proposal
The Exchange proposes to delete
NYSE Rule 446 and adopt new Rule
4370 to correspond with rule changes
filed by FINRA and approved by the
Commission.6
Background
On July 30, 2007, FINRA’s
predecessor, the National Association of
Securities Dealers, Inc. (‘‘NASD’’), and
NYSE Regulation, Inc. (‘‘NYSER’’)
consolidated their member firm
regulation operations into a combined
organization, FINRA. Pursuant to Rule
17d–2 under the Act, NYSE, NYSER and
FINRA entered into an agreement (the
‘‘Agreement’’) to reduce regulatory
duplication for their members by
allocating to FINRA certain regulatory
responsibilities for certain NYSE rules
and rule interpretations (‘‘FINRA
Incorporated NYSE Rules’’). NYSE
Amex LLC (‘‘NYSE Amex’’) became a
party to the Agreement effective
December 15, 2008.7
As part of its effort to reduce
regulatory duplication and relieve firms
that are members of FINRA, NYSE and
NYSE Amex of conflicting or
unnecessary regulatory burdens, FINRA
is now engaged in the process of
reviewing and amending the NASD and
FINRA Incorporated NYSE Rules in
jlentini on DSKJ8SOYB1PROD with NOTICES
2 15
U.S.C. 78a.
3 17 CFR 240.19b–4.
4 See Securities Exchange Act Release No. 60534
(August 19, 2009), 74 FR 44410 (August 28, 2009)
(order approving SR–FINRA–2009–036) (‘‘Release
No. 34–60534’’).
5 See Securities Exchange Act Release No. 61743
(March 19, 2010), 75 FR 14650.
6 See Release No. 34–60534, supra note 4.
7 See Securities Exchange Act Release Nos. 56148
(July 26, 2007), 72 FR 42146 (August 1, 2007) (order
approving the Agreement); 56147 (July 26, 2007), 72
FR 42166 (August 1, 2007) (SR–NASD–2007–054)
(order approving the incorporation of certain NYSE
Rules as ‘‘Common Rules’’); and 60409 (July 30,
2009), 74 FR 39353 (August 6, 2009) (order
approving the amended and restated Agreement,
adding NYSE Amex LLC as a party). Paragraph 2(b)
of the Agreement sets forth procedures regarding
proposed changes by FINRA, NYSE or NYSE Amex
to the substance of any of the Common Rules.
VerDate Mar<15>2010
17:18 May 07, 2010
Jkt 220001
order to create a consolidated FINRA
rulebook.8
In 2008, FINRA deleted FINRA
Incorporated NYSE Rule 446 (Business
Continuity and Contingency Plans) as
substantively duplicative of NASD
Rules 3510 (Business Continuity Plans)
and 3520 (Emergency Contact
Information).9 Correspondingly, the
Exchange amended NYSE Rule 446
(Business Continuity and Contingency
Plans) to remove the existing text and
incorporate NASD Rules 3510 and 3520
by reference.10 Subsequently, FINRA
adopted, subject to certain amendments,
NASD Rules 3510 and 3520 as
consolidated FINRA Rule 4370
(Business Continuity Plans and
Emergency Contact Information).11
The Exchange correspondingly
proposes to delete NYSE Rule 446 and
replace it with proposed NYSE Rule
4370, which is substantially similar to
the new FINRA Rule.12 The Exchange
states that the purpose of this proposed
rule change is to harmonize the NYSE
Rules with the consolidated FINRA
Rules. The Exchange states that, as
proposed, NYSE Rule 4370 adopts the
same language as FINRA Rule 4370,
except for substituting for or adding to,
as needed, the term ‘‘member
organization’’ for the term ‘‘member,’’
and making corresponding technical
changes that reflect the difference
between NYSE’s and FINRA’s
membership structures. The Exchange
also states that, in paragraph (f)(2) to
proposed NYSE Rule 4370, the
Exchange has added a cross-reference to
NYSE Rule 416A to ensure that those
Exchange members and member
organizations that are not FINRA
members are required to update the
contact information for emergency
personnel in accordance with NYSE
Rules.
The Exchange also proposes to add
Supplementary Material .01 to NYSE
Rule 4370 to provide that, for the
8 FINRA’s rulebook currently has three sets of
rules: (1) NASD Rules, (2) FINRA Incorporated
NYSE Rules, and (3) consolidated FINRA Rules.
The FINRA Incorporated NYSE Rules apply only to
those members of FINRA that are also members of
the NYSE (‘‘Dual Members’’), while the consolidated
FINRA Rules apply to all FINRA members. For
more information about the FINRA rulebook
consolidation process, see FINRA Information
Notice, March 12, 2008.
9 See Securities Exchange Act Release No. 58533
(September 12, 2008), 73 FR 54652 (September 22,
2008) (order approving SR–FINRA–2008–036).
10 See Securities Exchange Act Release No. 58549
(September 15, 2008), 73 FR 54444 (September 19,
2008) (order approving SR–NYSE–2008–080).
11 See Release No. 34–60534, supra note 4.
12 NYSE Amex submitted a companion rule filing
amending its rules in accordance with FINRA’s rule
changes, which the Commission has approved. See
Securities Exchange Act Release No. 62014 (April
30, 2010) (SR–NYSE–Amex–2010–26).
PO 00000
Frm 00075
Fmt 4703
Sfmt 4703
25903
purposes of the rule, the term
‘‘associated person’’ shall have the same
meaning as the terms ‘‘person associated
with a member’’ or ‘‘associated person of
a member’’ as defined in Article I (rr) of
the FINRA By-Laws. The Exchange
states that this change is necessary to
ensure that both proposed NYSE Rule
4370 and FINRA Rule 4370 are fully
harmonized.
Finally, the Exchange proposes that
the effective date for the proposed rule
changes be retroactive to December 14,
2009, the same effective date for the
corresponding FINRA rule changes.13
As a result, there should be no
regulatory gaps between the FINRA and
NYSE Rules and that, as applicable, the
NYSE Rules would maintain their status
as Common Rules under the
Agreement.14
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange. In particular, the
Commission finds that the proposal is
consistent with Section 6(b)(5) of the
Act,15 which requires, among other
things, that the rules of a national
securities exchange be designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, 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.16
The Commission believes that the
proposed rule change provides greater
harmonization between NYSE Rules and
FINRA Rules (including Common Rules)
of similar purpose, resulting in less
burdensome and more efficient
regulatory compliance for NYSE
members, including Dual Members. In
addition, the Commission believes that
retroactive application of the proposed
rule change to December 14, 2009 is
appropriate to assure that there are no
regulatory gaps between FINRA and
NYSE Rules, and that, as applicable, the
NYSE Rules would maintain their status
as Common Rules under the Agreement.
13 See FINRA Regulatory Notice 09–60 (October
15, 2009).
14 As provided in paragraph 2(b) of the
Agreement, FINRA and NYSE will amend the list
of Common Rules to conform to the rule changes
proposed herein.
15 15 U.S.C. 78f(b)(5).
16 In approving the proposed rule change, the
Commission notes that it has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. 15 U.S.C. 78c(f).
E:\FR\FM\10MYN1.SGM
10MYN1
25904
Federal Register / Vol. 75, No. 89 / Monday, May 10, 2010 / Notices
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,17 that the
proposed rule change (SR–NYSE–2010–
23) be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–10953 Filed 5–7–10; 8:45 am]
BILLING CODE 8010–01–P
SOCIAL SECURITY ADMINISTRATION
Privacy Act of 1974; as Amended;
Proposed Alteration to an Existing
Privacy Act System of Records,
Housekeeping Changes, and New
Routine Uses
AGENCY:
Social Security Administration
(SSA).
ACTION: Altered system of records,
housekeeping changes, and routine
uses.
In accordance with the
Privacy Act (5 U.S.C. 552a(e)(4) and
(e)(11)) we are issuing public notice of
our intent to alter an existing system of
records, make housekeeping and other
miscellaneous changes, and add routine
uses applicable to our system of records
entitled the Representative
Disqualification/Suspension
Information System (60–0219),
hereinafter referred to as the
Representative Disqualification,
Suspension, and Non-Recognition
Information File.
We propose the following changes:
• Expand the existing category of
representatives covered by the
Representative Disqualification,
Suspension, and Non-Recognition
Information File system of records to
include persons who allegedly fail to
meet our qualifications to serve as a
claimant’s representative.
• Expand the category of records we
maintain in the system to include the
name, Social Security number (SSN),
date of birth, address, and other relevant
information about persons who want to
serve as representatives for our
claimants. The expanded category will
also include information about
representatives, such as the
representative’s date of birth, SSN,
representative identification number,
telephone and facsimile (fax) numbers,
and e-mail address.
We will also include the type of
representative (e.g., attorney, non-
jlentini on DSKJ8SOYB1PROD with NOTICES
SUMMARY:
17 15
18 17
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
VerDate Mar<15>2010
17:18 May 07, 2010
Jkt 220001
attorney, eligible direct pay nonattorney), attorney status (e.g.,
suspended, disqualified, convicted of a
violation), bar, court, and Federal
agency program admission information
(e.g., year admitted, license number,
present standing, and disciplinary
history), and employer identification
number.
• Expand the record storage medium
to house records in paper and electronic
form.
• Change the system of records name
from the Representative
Disqualification/Suspension
Information System to the
Representative Disqualification,
Suspension, and Non-Recognition
Information File to more accurately
reflect the persons and representatives
covered by the system of records.
• Add new routine uses 2–4, 6, and
8–10 to allow us to release information
about persons who allegedly fail to meet
our qualifications to serve as a
claimant’s representative,
representatives whom we have
disqualified or suspended from
representing claimants and beneficiaries
before us, and pursue the investigation
of, and litigation against, representatives
alleged to have violated the provisions
of the Social Security Act or our
regulations. We are also adding our data
protection routine use to the system of
records. The routine use, listed as
number 12 in this system of records,
will allow us to respond to incidents
involving the unintentional release of
our records.
• Make edits throughout the
document to ensure a more readerfriendly document and correct
miscellaneous and stylistic format
errors.
We discuss the system of records,
housekeeping changes, and new routine
uses in the Supplementary Information
section below. We invite public
comments on this proposal.
DATES: We filed a report of the
Representative Disqualification,
Suspension, and Non-Recognition
Information File system of records and
new routine use disclosures with the
Chairman of the Senate Committee on
Homeland Security and Governmental
Affairs, the Chairman of the House
Committee on Oversight and
Government Reform, and the Director,
Office of Information and Regulatory
Affairs, Office of Management and
Budget (OMB), on April 29, 2010. The
altered Representative Disqualification,
Suspension, and Non-Recognition
Information File system of records and
new routine uses will become effective
on June 7, 2010, unless we receive
PO 00000
Frm 00076
Fmt 4703
Sfmt 4703
comments before that date that would
result in a contrary determination.
ADDRESSES: Interested persons may
comment on this publication by writing
to the Executive Director, Office of
Privacy and Disclosure, Office of the
General Counsel, Social Security
Administration, Room 3–A–6
Operations Building, 6401 Security
Boulevard, Baltimore, Maryland 21235–
6401. All comments we receive will be
available for public inspection at the
above address.
FOR FURTHER INFORMATION CONTACT:
Christine W. Johnson, Social Insurance
Specialist (Senior Analyst), Disclosure
Policy Development and Services
Division I, Office of Privacy and
Disclosure, Office of the General
Counsel, Social Security
Administration, 3–A–6 Operations
Building, 6401 Security Boulevard,
Baltimore, Maryland 21235–6401,
telephone: (410) 965–8563 or e-mail:
chris.w.johnson@ssa.gov.
SUPPLEMENTARY INFORMATION:
I. Background and Purpose of the
Representative Disqualification,
Suspension, and Non-Recognition
Information File System of Records
A. General Background
The Representative Disqualification,
Suspension, and Non-Recognition
Information File system of records
allows us to collect, maintain, and use
information about persons who fail to
meet our qualifications to serve as
representatives for our claimants and
beneficiaries, representatives about
whom we have received complaints
alleging that they have violated the
provisions of the Social Security Act or
regulations, and representatives who we
have disqualified or suspended from
representing claimants and beneficiaries
in matters before us.
We require the information covered
by this system of records to efficiently
administer the disqualified or
suspended representative business
process. For example, the information
enables us to identify and monitor
persons who fail to meet the criteria to
represent our claimants and
beneficiaries, determine whether a
violation has occurred, investigate
alleged violations, and administratively
prosecute disciplinary actions against
representatives, in a more efficient and
timely manner.
B. Discussion of Representative
Disqualification, Suspension, and NonRecognition Information File System of
Records
The proposed alteration will
significantly strengthen the disqualified
E:\FR\FM\10MYN1.SGM
10MYN1
]]>Agencies
[Federal Register Volume 75, Number 89 (Monday, May 10, 2010)]
[Notices]
[Pages 25902-25904]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-10953]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62015; File No. SR-NYSE-2010-23]
Self-Regulatory Organizations; New York Stock Exchange LLC; Order
Approving Proposed Rule Change Deleting NYSE Rule 446 and Adopting New
Rule 4370 To Correspond With Rule Changes Filed by the Financial
Industry Regulatory Authority, Inc.
April 30, 2010.
I. Introduction
On March 11, 2010, the New York Stock Exchange LLC (``NYSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) \1\ of the Securities
Exchange Act
[[Page 25903]]
of 1934 (the ``Act''),\2\ and Rule 19b-4 thereunder,\3\ a proposed rule
change to delete NYSE Rule 446 and adopt new Rule 4370 to correspond
with rule changes filed by the Financial Industry Regulatory Authority,
Inc. (``FINRA'') and approved by the Commission.\4\ The proposed rule
change was published for comment in the Federal Register on March 26,
2010.\5\ The Commission received no comments on the proposal. This
order approves the proposed rule change.
---------------------------------------------------------------------------
\1\ 15 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. 60534 (August 19,
2009), 74 FR 44410 (August 28, 2009) (order approving SR-FINRA-2009-
036) (``Release No. 34-60534'').
\5\ See Securities Exchange Act Release No. 61743 (March 19,
2010), 75 FR 14650.
---------------------------------------------------------------------------
II. Description of the Proposal
The Exchange proposes to delete NYSE Rule 446 and adopt new Rule
4370 to correspond with rule changes filed by FINRA and approved by the
Commission.\6\
---------------------------------------------------------------------------
\6\ See Release No. 34-60534, supra note 4.
---------------------------------------------------------------------------
Background
On July 30, 2007, FINRA's predecessor, the National Association of
Securities Dealers, Inc. (``NASD''), and NYSE Regulation, Inc.
(``NYSER'') consolidated their member firm regulation operations into a
combined organization, FINRA. Pursuant to Rule 17d-2 under the Act,
NYSE, NYSER and FINRA entered into an agreement (the ``Agreement'') to
reduce regulatory duplication for their members by allocating to FINRA
certain regulatory responsibilities for certain NYSE rules and rule
interpretations (``FINRA Incorporated NYSE Rules''). NYSE Amex LLC
(``NYSE Amex'') became a party to the Agreement effective December 15,
2008.\7\
---------------------------------------------------------------------------
\7\ See Securities Exchange Act Release Nos. 56148 (July 26,
2007), 72 FR 42146 (August 1, 2007) (order approving the Agreement);
56147 (July 26, 2007), 72 FR 42166 (August 1, 2007) (SR-NASD-2007-
054) (order approving the incorporation of certain NYSE Rules as
``Common Rules''); and 60409 (July 30, 2009), 74 FR 39353 (August 6,
2009) (order approving the amended and restated Agreement, adding
NYSE Amex LLC as a party). Paragraph 2(b) of the Agreement sets
forth procedures regarding proposed changes by FINRA, NYSE or NYSE
Amex to the substance of any of the Common Rules.
---------------------------------------------------------------------------
As part of its effort to reduce regulatory duplication and relieve
firms that are members of FINRA, NYSE and NYSE Amex of conflicting or
unnecessary regulatory burdens, FINRA is now engaged in the process of
reviewing and amending the NASD and FINRA Incorporated NYSE Rules in
order to create a consolidated FINRA rulebook.\8\
---------------------------------------------------------------------------
\8\ FINRA's rulebook currently has three sets of rules: (1) NASD
Rules, (2) FINRA Incorporated NYSE Rules, and (3) consolidated FINRA
Rules. The FINRA Incorporated NYSE Rules apply only to those members
of FINRA that are also members of the NYSE (``Dual Members''), while
the consolidated FINRA Rules apply to all FINRA members. For more
information about the FINRA rulebook consolidation process, see
FINRA Information Notice, March 12, 2008.
---------------------------------------------------------------------------
In 2008, FINRA deleted FINRA Incorporated NYSE Rule 446 (Business
Continuity and Contingency Plans) as substantively duplicative of NASD
Rules 3510 (Business Continuity Plans) and 3520 (Emergency Contact
Information).\9\ Correspondingly, the Exchange amended NYSE Rule 446
(Business Continuity and Contingency Plans) to remove the existing text
and incorporate NASD Rules 3510 and 3520 by reference.\10\
Subsequently, FINRA adopted, subject to certain amendments, NASD Rules
3510 and 3520 as consolidated FINRA Rule 4370 (Business Continuity
Plans and Emergency Contact Information).\11\
---------------------------------------------------------------------------
\9\ See Securities Exchange Act Release No. 58533 (September 12,
2008), 73 FR 54652 (September 22, 2008) (order approving SR-FINRA-
2008-036).
\10\ See Securities Exchange Act Release No. 58549 (September
15, 2008), 73 FR 54444 (September 19, 2008) (order approving SR-
NYSE-2008-080).
\11\ See Release No. 34-60534, supra note 4.
---------------------------------------------------------------------------
The Exchange correspondingly proposes to delete NYSE Rule 446 and
replace it with proposed NYSE Rule 4370, which is substantially similar
to the new FINRA Rule.\12\ The Exchange states that the purpose of this
proposed rule change is to harmonize the NYSE Rules with the
consolidated FINRA Rules. The Exchange states that, as proposed, NYSE
Rule 4370 adopts the same language as FINRA Rule 4370, except for
substituting for or adding to, as needed, the term ``member
organization'' for the term ``member,'' and making corresponding
technical changes that reflect the difference between NYSE's and
FINRA's membership structures. The Exchange also states that, in
paragraph (f)(2) to proposed NYSE Rule 4370, the Exchange has added a
cross-reference to NYSE Rule 416A to ensure that those Exchange members
and member organizations that are not FINRA members are required to
update the contact information for emergency personnel in accordance
with NYSE Rules.
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\12\ NYSE Amex submitted a companion rule filing amending its
rules in accordance with FINRA's rule changes, which the Commission
has approved. See Securities Exchange Act Release No. 62014 (April
30, 2010) (SR-NYSE-Amex-2010-26).
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The Exchange also proposes to add Supplementary Material .01 to
NYSE Rule 4370 to provide that, for the purposes of the rule, the term
``associated person'' shall have the same meaning as the terms ``person
associated with a member'' or ``associated person of a member'' as
defined in Article I (rr) of the FINRA By-Laws. The Exchange states
that this change is necessary to ensure that both proposed NYSE Rule
4370 and FINRA Rule 4370 are fully harmonized.
Finally, the Exchange proposes that the effective date for the
proposed rule changes be retroactive to December 14, 2009, the same
effective date for the corresponding FINRA rule changes.\13\ As a
result, there should be no regulatory gaps between the FINRA and NYSE
Rules and that, as applicable, the NYSE Rules would maintain their
status as Common Rules under the Agreement.\14\
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\13\ See FINRA Regulatory Notice 09-60 (October 15, 2009).
\14\ As provided in paragraph 2(b) of the Agreement, FINRA and
NYSE will amend the list of Common Rules to conform to the rule
changes proposed herein.
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III. Discussion and Commission Findings
After careful review, the Commission finds that the proposed rule
change is consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a national securities exchange. In
particular, the Commission finds that the proposal is consistent with
Section 6(b)(5) of the Act,\15\ which requires, among other things,
that the rules of a national securities exchange be designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, 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.\16\
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\15\ 15 U.S.C. 78f(b)(5).
\16\ In approving the proposed rule change, the Commission notes
that it has considered the proposed rule's impact on efficiency,
competition, and capital formation. 15 U.S.C. 78c(f).
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The Commission believes that the proposed rule change provides
greater harmonization between NYSE Rules and FINRA Rules (including
Common Rules) of similar purpose, resulting in less burdensome and more
efficient regulatory compliance for NYSE members, including Dual
Members. In addition, the Commission believes that retroactive
application of the proposed rule change to December 14, 2009 is
appropriate to assure that there are no regulatory gaps between FINRA
and NYSE Rules, and that, as applicable, the NYSE Rules would maintain
their status as Common Rules under the Agreement.
[[Page 25904]]
IV. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\17\ that the proposed rule change (SR-NYSE-2010-23) be, and hereby
is, approved.
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\17\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-10953 Filed 5-7-10; 8:45 am]
BILLING CODE 8010-01-P
