[Federal Register Volume 68, Number 157 (Thursday, August 14, 2003)]
[Notices]
[Page 48656]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-20769]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48305; File No. SR-NASD-2003-99]


Self-Regulatory Organizations; Order Granting Approval of 
Proposed Rule Change by the National Association of Securities Dealers, 
Inc. To Amend Rule 6260 Regarding New Issue Notification Procedures for 
TRACE-Eligible Securities

August 8, 2003.
    On June 19, 2003, the National Association of Securities Dealers, 
Inc. (``NASD'') filed with the Securities and Exchange Commission 
(``SEC'' or ``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 amend Rule 6260 of NASD's 
Trade Reporting and Compliance Engine (``TRACE'') rules. Specifically, 
NASD is proposing to amend Rule 6260(a) and (b) to require members to 
provide additional, descriptive information in the notice that is sent 
to NASD that identifies the basic terms of a new TRACE-eligible 
security (``new issue notification''), and to provide the information 
required in Rule 6260(b) by email or facsimile. The proposal requires 
the managing underwriter of any newly issued TRACE-eligible security to 
provide to the TRACE Operations Center information, as determined by 
NASD, that is required to determine if a TRACE-eligible security must 
be disseminated under Rule 6250 (e.g., size of issue and rating). 
Notice of the proposed rule change, including a discussion of the 
proposal in greater detail, was published for comment in the Federal 
Register on July 8, 2003.\3\ The Commission received no comments 
regarding the proposal.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 48113 (June 30, 2003), 
68 FR 40727.
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    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the Act and the rules and regulations 
promulgated thereunder applicable to a registered securities 
association and, in particular, with the requirements of Section 
15A(b)(6) of the Act.\4\ Specifically, the Commission finds that 
approval of the proposed rule change is consistent with Section 
15A(b)(6) of the Act in that it is 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.\5\
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    \4\ 15 U.S.C. 78o-3(b)(6).
    \5\ In approving this proposed rule change, the Commission has 
considered the proposal's impact on efficiency, competition, and 
capital formation. 15 U.S.C. 78c(f).
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    The Commission believes that requiring NASD members to provide 
additional information about new TRACE-eligible securities is necessary 
for NASD to determine if those new securities are subject to 
dissemination, and that requiring that new issue information be 
provided by email or facsimile will provide NASD with written records 
about TRACE-eligible securities. The Commission also believes that the 
proposed rule change will improve the operation of TRACE which provides 
price transparency and provides regulators with heightened capabilities 
to regulate and provide surveillance of the debt securities markets to 
prevent fraudulent and manipulative acts and practices. For the reasons 
discussed above, the Commission finds that the proposal is consistent 
with the Act and the rules and regulations thereunder.
    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\6\ that the proposed rule change (SR-NASD-2003-99), be, and hereby 
is, approved.
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    \6\ Id.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-20769 Filed 8-13-03; 8:45 am]
BILLING CODE 8010-01-P