[Federal Register Volume 59, Number 222 (Friday, November 18, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-28495]


[[Page Unknown]]

[Federal Register: November 18, 1994]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-34967; File Nos. SR-NYSE-94-23; SR-NYSE-94-24]

 

Self-Regulatory Organizations; New York Stock Exchange, Inc.; 
Order Approving a Proposed Rule Change Relating to Examination 
Specifications for the General Securities Sales Supervisor (Series 8) 
Examination, and the Corresponding Content Outline

November 10, 1994.

I. Introduction

    On June 28, 1994, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange``) filed with the Securities and Exchange Commission 
(``Commission'') pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'')\1\ and Rule 19b-4 thereunder,\2\ 
proposed rule changes (File Nos. SR-NYSE-94-23 and SR-NYSE-94-24) to 
revise the General Securities Sales Supervisor (Series 8) Examination 
Specifications and the corresponding Content Outline.
---------------------------------------------------------------------------

    \1\15 U.S.C. Sec. 78s(b)(1) (1988).
    \2\17 CFR Sec. 240.19b-4 (1994).
---------------------------------------------------------------------------

    The proposed rule changes were published for comment in Securities 
Exchange Act Release Nos. 34335 (July 8, 1994), 59 FR 35961 (July 14, 
1994); and 34336 (July 8, 1994), 59 FR35962 (July 14, 1994). No 
comments were received on the proposals. This order approves the 
proposed rule changes contingent upon the filing of the revised 
Examination Specifications and Content Outline by other appropriate 
self-regulatory organizations (``SROs''), and approval of those filings 
by the Commission.

II. Description of the Proposal

    The General Securities Sales Supervisor (``Series 8'') Examination 
is an industry-wide qualification examination for securities sales 
supervisors. The Series 8 examination is generally required under rules 
of the self-regulatory organizations (``SROs'') for persons who are 
engaged in the supervision of general securities branch offices (i.e., 
branch office managers) and of general securities registered 
representatives. The Series 8 examination tests a candidate's knowledge 
of securities industry rules and regulations and certain statutory 
provisions applicable to general securities sales supervision. The 
Series 8 Content Outline details the subject coverage and question 
allocation of the examination. The Examination Specifications detail 
the areas covered by the examination and break down the number of 
examination questions culled from each area.
    Revision of the Series 8 Examination, Examination Specifications, 
and Content Outline was recently undertaken by an industry committee 
composed of representatives from SROs (the NYSE, the American Stock 
Exchange, the Chicago Board Options Exchange, the Municipal Securities 
Rulemaking Board, the National Association of Securities Dealers and 
the Philadelphia Stock Exchange) and representatives from broker-
dealers, including branch office managers, compliance personnel and 
corporate executives, in order to update the examination in view of 
changes in relevant laws, rules and regulations, the development of new 
products, and to reflect various changes in industry practices. The 
committee reviewed the examination specifications, content areas and 
item bank and developed some new questions in new areas.
    The revised examination continues to cover the areas of knowledge 
required to supervise sales activities in securities, however, the 
focus of the content of the examination has been shifted to concentrate 
more closely on supervisory duties. Accordingly, certain questions have 
been deleted from the examination which deal with routine calculations 
and basic product knowledge and questions on new federal and SRO rules 
and regulations have been incorporated into the exam, as well as 
questions on new products, supervision and changes in industry 
practices. The revised Examination Specifications and Content Outline 
reflect the revised content of the examination. The examination will 
remain a six-hour, two-part, 200 question examination.
    The Commission anticipates that the other appropriate SRO 
participants also will file the revised Specifications and Content 
Outline for approval by the Commission. The NYSE, and these other SROs, 
may use the revised Examination, Specifications and Content Outline 
after the Commission has approved the proposed rule changes of the 
other appropriate SRO participants.

III. Discussion

    After careful review, the Commission finds that the proposed rule 
changes are consistent with the requirements of the Act and the rules 
and regulations thereunder applicable to a national securities 
exchange, and in particular, with the requirements of Sections 6(b)(5) 
and 6(c)(3)(B) of the Act.\3\ Section 6(b)(5) requires, among other 
things, that the rules of an 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. Section 
6(c)(3)(B) provides that a national securities exchange may examine and 
verify the qualifications of an applicant to become a person associated 
with a member in accordance with procedures established by the rules of 
the exchange, and may require any person associated with a member, or 
any class of such persons, to be registered with the exchange in 
accordance with procedures so established.
---------------------------------------------------------------------------

    \3\15 U.S.C. Sec. 78f (b)(5) and (c)(3)(B) (1988).
---------------------------------------------------------------------------

    The Commission believes that revising the Series 8 Examination, 
Specifications and Content Outline should help to ensure that only 
those securities sales supervisors with a comprehensive knowledge of 
current Exchange rules, as well as an understanding of the Act, will be 
able to supervise general securities branch offices and registered 
representatives. The Commission believes that the revised areas covered 
by the Examination, Specifications and Content Outline are appropriate 
subject matters and include a sufficiently broad range of topics to 
ensure an appropriate level of expertise by supervisors. Additionally, 
the revised examination tests relevant subject matters in view of 
changes in applicable laws, rules, regulations, products, and industry 
practices. By ensuring this requisite level of knowledge, the NYSE can 
remain confident that securities sales supervisors have demonstrated an 
acceptable level of securities knowledge to carry out their 
responsibilities.
    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\4\ that the proposed rule changes (File Nos. SR-NYSE-94-23 and SR-
NYSE-94-24) are approved contingent upon the filing of the Examination 
Specifications and Content Outline by the other appropriate SROs and 
the approval of those filings by the Commission.

    \4\15 U.S.C. Sec. 78s(b)(2) (1988).
---------------------------------------------------------------------------

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\
---------------------------------------------------------------------------

    \5\17 CFR 200.30-3(a)(12) (1994).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-28495 Filed 11-17-94; 8:45 am]
BILLING CODE 8010-01-M