[Federal Register Volume 66, Number 217 (Thursday, November 8, 2001)]
[Notices]
[Page 56590]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28080]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45012; File No. SR-NYSE-2001-29]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by the New York Stock Exchange, Inc. Eliminating the Exchange's 
Discretion To Exempt Relief Specialists From Registration and Approval

November 2, 2001.
    On August 21, 2001, 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\ a 
proposed rule change to eliminate the Exchange's discretion to exempt 
relief specialists from registration and approval requirements. 
Specifically, the proposed rule change would amend NYSE Rule 103 
(Registration of Specialists) to delete the provision that grants the 
Exchange the discretion to exempt relief specialists from registration 
and approval requirements.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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    According to the NYSE, the provision in NYSE Rule 103 is 
unnecessary because NYSE Rule 104.15 requires regular specialists to 
either (1) be associated with other members also registered as regular 
specialists in the same stocks and arrange for at least one member of 
the group to be in attendance during the hours when the Exchange is 
open for business, or (2) arrange for the registration by at least one 
other member as relief specialist, who would always be available, in 
the regular specialist's absence, to take over the book and to service 
the market, so that there would be no interruption of the continuity of 
service during the hours when the Exchange is open for business.\3\
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    \3\ Telephone conversation between Melvin Hanton, Senior Special 
Counsel, NYSE, and Jennifer Lewis, Attorney, Division of Market 
Regulation, Commission, on October 29, 2001.
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    The proposed rule change was published for comment in the Federal 
Register on September 27, 2001.\4\ The Commission received no comments 
on the proposal.
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    \4\ See Securities Exchange Act Release No. 44825 (September 20, 
2001), 66 FR 49442.
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    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 \5\ and, in 
particular, the requirements of section 6 of the Act.\6\ The Commission 
finds that the proposed rule change is consistent with section 6(b)(5) 
of the Act,\7\ which requires, among other things, that the rules of an 
exchange promote just and equitable principles of trade and in general 
to protect investors and the public interest. Specifically, the 
Commission believes that the proposal should ensure that only qualified 
persons act as specialists because it requires all specialists to 
comply with registration and approval requirements. In addition, the 
provisions of NYSE Rule 104.15 will ensure that specialist firms always 
have a relief specialist who meets the registration and approval 
requirements of NYSE Rule 103 available to take over the book if 
necessary at any time. Accordingly, the provisions of NYSE Rule 104.15 
make the exemption provided for in NYSE Rule 103 unnecessary.
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    \5\ In approving this proposal 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).
    \6\ 15 U.S.C. 78f.
    \7\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\8\ that the proposed rule change (SR-NYSE-2001-29) be, and it 
hereby is, approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-28080 Filed 11-7-01; 8:45 am]
BILLING CODE 8010-01-M