Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Update Certain Cross-References and Make a Non-Substantive Technical Change to a FINRA Rule, 29793-29795 [2010-12747]
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Federal Register / Vol. 75, No. 102 / Thursday, May 27, 2010 / Notices
wwoods2 on DSK1DXX6B1PROD with NOTICES
event to the BCC as a fourth violation
under the current rule, such violations
should be batched together and treated
as one violation. This way, pursuant to
the revised rules, the firm would receive
a warning letter for the first three
batched violations before being subject
to a monetary fine. The Exchange
further noted that it could, in any
particular situation, deem the violations
to be egregious rather than ‘‘minor’’ and
refer the matter directly to the BCC for
disciplinary action. The Exchange
believes that this approach is
appropriate because the relevant
warning letters or monetary fines should
serve as a deterrent against future
violations, while recognizing that a
single programming error can have a
widespread effect. In addition, the
Exchange believes that Advice F–6 (and
its corresponding rule) is appropriate for
batching because the automated
surveillance for quote spread parameter
compliance,5 as well as the issuance of
sanctions pursuant to the minor rule
plan,6 will be conducted daily.
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.7 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,8 which requires,
among other things, that the rules of a
national securities exchange be
designed 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. The Commission also
believes that the proposal is consistent
with Sections 6(b)(1) and 6(b)(6) of the
Act,9 which require that the rules of an
exchange enforce compliance with, and
provide appropriate discipline for,
violations of Commission and Exchange
rules. Furthermore, the Commission
5 Confidential letters from Stephen M. Pettibone,
Managing Director Surveillance, Phlx, to Michael
Gaw, Assistant Director, Division of Trading and
Markets, and Tina Barry, Assistant Director, Office
of Compliance Inspections and Examinations,
Commission, dated October 6, 2009 and December
30, 2009.
6 See letter from Charles Rogers, Chief Regulatory
Officer, Phlx, to Tina Barry, Assistant Director,
Office of Compliance Inspections and Examinations
and Michael Gaw, Assistant Director, Division of
Trading and Markets, Commission, dated February
18, 2010.
7 In approving this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
8 15 U.S.C. 78f(b)(5).
9 15 U.S.C. 78f(b)(1) and 78f(b)(6).
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believes that the proposed changes to
the MRP should strengthen the
Exchange’s ability to carry out its
oversight and enforcement
responsibilities as a self-regulatory
organization in cases where full
disciplinary proceedings are unsuitable
in view of the minor nature of the
particular violation. In addition, the
Commission finds that the proposal is
consistent with the public interest, the
protection of investors, or otherwise in
furtherance of the purposes of the Act,
as required by Rule 19d–1(c)(2) under
the Act,10 which governs minor rule
violation plans.
The Commission believes that the
Exchange’s proposal to amend Advice
F–6 to add rule text referencing quote
spread parameters for options that are
quoted electronically is appropriate
because the text was inadvertently
omitted. In addition, the Commission
believes that batching of violations of
the quote spread parameter rule, under
the MRP, reasonably addresses quoting
violations on an electronic market,
where one inadvertent error can
potentially result in multiple quotes that
fall outside the quote spread parameters.
The Exchange has represented it will
conduct automated surveillance for
quote spread parameter compliance on
a daily basis, and will issue sanctions
for quote spread violations pursuant to
the MRP also on a daily basis. The
Commission further notes that pursuant
to Rules 960.2(f)(ii) and 970.01, the
batching program will continue to
require that the violations be
determined based on an exceptionbased surveillance program. Any further
proposal by the Exchange to permit the
batching of violations of any Exchange
rule would be subject to Commission
approval.
In approving this proposed rule
change, the Commission in no way
minimizes the importance of
compliance with Exchange rules and all
other rules subject to the imposition of
fines under the MRP. The Commission
believes that the violation of any selfregulatory organization’s rules, as well
as Commission rules, is a serious matter.
However, the MRP provides a
reasonable means of addressing rule
violations that do not rise to the level of
requiring formal disciplinary
proceedings, while providing greater
flexibility in handling certain violations.
The Commission expects that the
Exchange will continue to conduct
surveillance with due diligence and
make a determination based on its
findings, on a case-by-case basis,
whether a fine of more or less than the
10 17
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CFR 240.19d–1(c)(2).
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29793
recommended amount is appropriate for
a violation under the MRP, whether it
might not be appropriate to batch a
series of actions as a single violation
under the MRP, or whether a violation
or series of violations may require
formal disciplinary action.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 11 and Rule
19d–1(c)(2) under the Act,12 that the
proposed rule change (SR–Phlx–2010–
43) be, and hereby is, approved and
declared effective.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–12748 Filed 5–26–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62146; File No. SR–FINRA–
2010–023]
Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Update Certain CrossReferences and Make a NonSubstantive Technical Change to a
FINRA Rule
May 20, 2010.
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 May 4,
2010, Financial Industry Regulatory
Authority, Inc. (‘‘FINRA’’) filed with the
Securities and Exchange Commission
(‘‘SEC’’ or ‘‘Commission’’) the proposed
rule change as described in Items I, II
and III below, which Items have been
prepared by FINRA. FINRA has
designated the proposed rule change as
constituting a ‘‘non-controversial’’ rule
change under paragraph (f)(6) of Rule
19b–4 under the Act,3 which renders
the proposal effective upon receipt of
this filing by the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
11 15
U.S.C. 78s(b)(2).
CFR 240.19d–1(c)(2).
13 17 CFR 200.30–3(a)(12) and 200.30–3(a)(44).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 17 CFR 240.19b–4(f)(6).
12 17
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29794
Federal Register / Vol. 75, No. 102 / Thursday, May 27, 2010 / Notices
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
FINRA is proposing to update crossreferences within certain FINRA rules to
reflect changes adopted in the
consolidated FINRA rulebook and to
make a non-substantive technical
change to a FINRA rule.
The text of the proposed rule change
is available on FINRA’s Web site at
https://www.finra.org, at the principal
office of FINRA and at the
Commission’s Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
FINRA 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. FINRA 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
wwoods2 on DSK1DXX6B1PROD with NOTICES
1. Purpose
FINRA is in the process of developing
a new consolidated rulebook
(‘‘Consolidated FINRA Rulebook’’).4
That process involves FINRA submitting
to the Commission for approval a series
of proposed rule changes over time to
adopt rules in the Consolidated FINRA
Rulebook. The phased adoption and
implementation of those rules
necessitates periodic amendments to
update rule cross-references and other
non-substantive technical changes in
the Consolidated FINRA Rulebook.
The proposed rule change would
update rule cross-references to reflect
recent changes adopted in the
Consolidated FINRA Rulebook. The
proposed rule change would update
FINRA Rule 0150 to reflect (1) the
4 The current FINRA rulebook consists of (1)
FINRA Rules; (2) NASD Rules; and (3) rules
incorporated from NYSE (‘‘Incorporated NYSE
Rules’’) (together, the NASD Rules and Incorporated
NYSE Rules are referred to as the ‘‘Transitional
Rulebook’’). While the NASD Rules generally apply
to all FINRA members, the Incorporated NYSE
Rules apply only to those members of FINRA that
are also members of the NYSE (‘‘Dual Members’’).
The FINRA Rules apply to all FINRA members,
unless such rules have a more limited application
by their terms. For more information about the
rulebook consolidation process, see Information
Notice, March 12, 2008 (Rulebook Consolidation
Process).
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adoption into the Consolidated FINRA
Rulebook of FINRA Rule 2261 and the
deletion of NASD Rules 2270 and 2910 5
and (2) the deletion of NASD Rules
2450 6 and 2780.7 The rule crossreferences in FINRA Rule 6630 8 would
be similarly updated to reflect (1) the
adoption of FINRA Rule 2261 and the
deletion of NASD Rule 2270 9 and (2)
the deletion of NASD Rule 2450.10
Finally, the rule references in FINRA
Rule 9217, which sets forth FINRA’s
Minor Rule Violation Plan, would be
updated to reflect the deletion of
Incorporated NYSE Rule 411(b).11
In addition, the proposed rule change
would make a technical amendment to
FINRA Rule 3160 to reflect a change in
FINRA’s style convention when
referencing federal securities
regulations.
FINRA has filed the proposed rule
change for immediate effectiveness. The
implementation date for the proposed
rule change will be June 14, 2010, the
date on which the previously approved
rule changes will be implemented.12
2. Statutory Basis
FINRA believes that the proposed rule
change is consistent with the provisions
of Section 15A(b)(6) of the Act,13 which
requires, among other things, that
FINRA rules must be designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, and, in
general, to protect investors and the
public interest. FINRA believes the
proposed rule change will provide
greater clarity to members and the
public regarding FINRA’s rules.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
FINRA 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.
5 See Securities Exchange Act Release No. 61540
(February 18, 2010), 75 FR 8771 (February 25, 2010)
(Order Approving File No. SR–FINRA–2009–081).
6 See Securities Exchange Act Release No. 61542
(February 18, 2010), 75 FR 8768 (February 25, 2010)
(Order Approving File No. SR–FINRA–2009–093).
7 See Securities Exchange Act Release No. 61473
(February 2, 2010), 75 FR 6422 (February 9, 2010)
(Order Approving File No. SR–FINRA–2009–087).
8 The text of FINRA Rule 6635 has recently been
amended and been renumbered as FINRA Rule
6630. The amended rule text is reflected in the
attached Exhibit 5. See Securities Exchange Act
Release No. 61979 (April 23, 2010), 75 FR 23316
(May 3, 2010) (SEC Approval Order for File No. SR–
FINRA–2010–003).
9 See note 5.
10 See note 6.
11 See note 7.
12 See Regulatory Notice 10–21 (April 2010).
13 15 U.S.C. 78o–3(b)(6).
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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
Because the foregoing 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 for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 14 and Rule 19b4(f)(6) thereunder.15
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.
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 rulecomments@sec.gov. Please include File
Number SR–FINRA–2010–023 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–FINRA–2010–023. 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
14 15
15 17
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U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
27MYN1
Federal Register / Vol. 75, No. 102 / Thursday, May 27, 2010 / Notices
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 Web site viewing and
printing 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
FINRA. 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–FINRA–2010–023 and
should be submitted on or before June
17, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–12747 Filed 5–26–10; 8:45 am]
BILLING CODE 8010–01–P
[Release No. 34–62142; File No. SR–NYSE–
2010–38]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Deleting NYSE
Rule 413 To Correspond With Rule
Changes Filed by the Financial
Industry Regulatory Authority, Inc.
wwoods2 on DSK1DXX6B1PROD with NOTICES
May 20, 2010.
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 May 12,
2010, 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. The Commission is
publishing this notice to solicit
CFR 200.30–3(a)(12).
1 15 U.S.C.78s(b)(1).
2 15 U.S.C. 78a.
3 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 delete
NYSE Rule 413 to correspond with rule
changes filed by the Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’)
and approved by the Commission.4 The
text of the proposed rule change is
available at the Exchange, the
Commission’s Public Reference Room,
and https://www.nyse.com.
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 the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
SECURITIES AND EXCHANGE
COMMISSION
16 17
comments on the proposed rule change
from interested persons.
The purpose of the proposed rule
changes is to delete NYSE Rule 413
(Uniform Forms) to correspond with
rule changes filed by FINRA and
approved by the Commission.
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, 2008.5
4 See Securities Exchange Act Release No. 61542
(February 18, 2010), 75 FR 8768 (February 25, 2010)
(order approving SR–FINRA–2009–093).
5 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
PO 00000
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29795
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.6
Proposed Conforming Amendments to
NYSE Rules:
FINRA recently deleted FINRA
Incorporated NYSE Rule 413 (Uniform
Forms), which required that each
member had to adopt such uniform
forms as may be prescribed by the
Exchange to facilitate the orderly flow of
transactions within the financial
community.7
In deleting FINRA Incorporated NYSE
Rule 413, FINRA noted that several
provisions in its By-Laws required its
members to provide certain information
in the manner and form prescribed by
FINRA, including membership
applications, registration of branch
offices, registration of registered
representatives and associated persons,
and termination of registered
employees. FINRA also noted its
proposal to adopt a new Rule 4540
governing information and data
reporting and filing requirements.8
In order to harmonize the NYSE Rules
with the approved consolidated FINRA
Rules, the Exchange correspondingly
proposes to delete NYSE Rule 413.9 As
with FINRA, the Exchange has a number
of rules that require members and
member organizations to provide certain
information in the manner and form
prescribed by the Exchange: for
example, NYSE Rules 301(b) and 311–
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.
6 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.
7 See Securities Exchange Act Release No. 61542
(February 18, 2010), 75 FR 8768 (February 25,
2010).
8 See Securities Exchange Act Release No. 61542
(February 18, 2010), 75 FR 8768 (February 25,
2010).
9 NYSE Amex has submitted a companion rule
filing amending its rules in accordance with
FINRA’s rule changes. See SR–NYSEAmex–2010–
45.
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]]>Agencies
[Federal Register Volume 75, Number 102 (Thursday, May 27, 2010)]
[Notices]
[Pages 29793-29795]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-12747]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62146; File No. SR-FINRA-2010-023]
Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of
Proposed Rule Change To Update Certain Cross-References and Make a Non-
Substantive Technical Change to a FINRA Rule
May 20, 2010.
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 May 4, 2010, Financial Industry Regulatory Authority, Inc.
(``FINRA'') filed with the Securities and Exchange Commission (``SEC''
or ``Commission'') the proposed rule change as described in Items I, II
and III below, which Items have been prepared by FINRA. FINRA has
designated the proposed rule change as constituting a ``non-
controversial'' rule change under paragraph (f)(6) of Rule 19b-4 under
the Act,\3\ which renders the proposal effective upon receipt of this
filing by the Commission. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
[[Page 29794]]
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
FINRA is proposing to update cross-references within certain FINRA
rules to reflect changes adopted in the consolidated FINRA rulebook and
to make a non-substantive technical change to a FINRA rule.
The text of the proposed rule change is available on FINRA's Web
site at https://www.finra.org, at the principal office of FINRA and at
the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, FINRA 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. FINRA 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
FINRA is in the process of developing a new consolidated rulebook
(``Consolidated FINRA Rulebook'').\4\ That process involves FINRA
submitting to the Commission for approval a series of proposed rule
changes over time to adopt rules in the Consolidated FINRA Rulebook.
The phased adoption and implementation of those rules necessitates
periodic amendments to update rule cross-references and other non-
substantive technical changes in the Consolidated FINRA Rulebook.
---------------------------------------------------------------------------
\4\ The current FINRA rulebook consists of (1) FINRA Rules; (2)
NASD Rules; and (3) rules incorporated from NYSE (``Incorporated
NYSE Rules'') (together, the NASD Rules and Incorporated NYSE Rules
are referred to as the ``Transitional Rulebook''). While the NASD
Rules generally apply to all FINRA members, the Incorporated NYSE
Rules apply only to those members of FINRA that are also members of
the NYSE (``Dual Members''). The FINRA Rules apply to all FINRA
members, unless such rules have a more limited application by their
terms. For more information about the rulebook consolidation
process, see Information Notice, March 12, 2008 (Rulebook
Consolidation Process).
---------------------------------------------------------------------------
The proposed rule change would update rule cross-references to
reflect recent changes adopted in the Consolidated FINRA Rulebook. The
proposed rule change would update FINRA Rule 0150 to reflect (1) the
adoption into the Consolidated FINRA Rulebook of FINRA Rule 2261 and
the deletion of NASD Rules 2270 and 2910 \5\ and (2) the deletion of
NASD Rules 2450 \6\ and 2780.\7\ The rule cross-references in FINRA
Rule 6630 \8\ would be similarly updated to reflect (1) the adoption of
FINRA Rule 2261 and the deletion of NASD Rule 2270 \9\ and (2) the
deletion of NASD Rule 2450.\10\ Finally, the rule references in FINRA
Rule 9217, which sets forth FINRA's Minor Rule Violation Plan, would be
updated to reflect the deletion of Incorporated NYSE Rule 411(b).\11\
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 61540 (February 18,
2010), 75 FR 8771 (February 25, 2010) (Order Approving File No. SR-
FINRA-2009-081).
\6\ See Securities Exchange Act Release No. 61542 (February 18,
2010), 75 FR 8768 (February 25, 2010) (Order Approving File No. SR-
FINRA-2009-093).
\7\ See Securities Exchange Act Release No. 61473 (February 2,
2010), 75 FR 6422 (February 9, 2010) (Order Approving File No. SR-
FINRA-2009-087).
\8\ The text of FINRA Rule 6635 has recently been amended and
been renumbered as FINRA Rule 6630. The amended rule text is
reflected in the attached Exhibit 5. See Securities Exchange Act
Release No. 61979 (April 23, 2010), 75 FR 23316 (May 3, 2010) (SEC
Approval Order for File No. SR-FINRA-2010-003).
\9\ See note 5.
\10\ See note 6.
\11\ See note 7.
---------------------------------------------------------------------------
In addition, the proposed rule change would make a technical
amendment to FINRA Rule 3160 to reflect a change in FINRA's style
convention when referencing federal securities regulations.
FINRA has filed the proposed rule change for immediate
effectiveness. The implementation date for the proposed rule change
will be June 14, 2010, the date on which the previously approved rule
changes will be implemented.\12\
---------------------------------------------------------------------------
\12\ See Regulatory Notice 10-21 (April 2010).
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2. Statutory Basis
FINRA believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(6) of the Act,\13\ which requires, among
other things, that FINRA rules must be designed to prevent fraudulent
and manipulative acts and practices, to promote just and equitable
principles of trade, and, in general, to protect investors and the
public interest. FINRA believes the proposed rule change will provide
greater clarity to members and the public regarding FINRA's rules.
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\13\ 15 U.S.C. 78o-3(b)(6).
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B. Self-Regulatory Organization's Statement on Burden on Competition
FINRA 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.
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
Because the foregoing 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 for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \14\ and Rule 19b-
4(f)(6) thereunder.\15\
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f)(6).
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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.
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-FINRA-2010-023 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-FINRA-2010-023. 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
[[Page 29795]]
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 Web site viewing and printing 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 FINRA. 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-FINRA-2010-023 and should be submitted on or before June 17, 2010.
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,
Deputy Secretary.
[FR Doc. 2010-12747 Filed 5-26-10; 8:45 am]
BILLING CODE 8010-01-P
