[Federal Register Volume 69, Number 80 (Monday, April 26, 2004)]
[Notices]
[Page 22578]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-9423]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49581; File No. SR-NASD-2003-159]


Self-Regulatory Organizations; Order Granting Approval of 
Proposed Rule Change and Amendment No. 1 by the National Association of 
Securities Dealers, Inc. To Permit Nasdaq To Append a New Modifier to 
Trade Reports of Pre-Open and After-Hours Trades Not Submitted to 
Nasdaq's Automated Confirmation Transaction Service, and Other Changes 
Regarding Trade Reporting

April 19, 2004.
    On October 16, 2003, the National Association of Securities 
Dealers, Inc. (``NASD''), through its subsidiary, The Nasdaq Stock 
Market, Inc. (``Nasdaq''), 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 permit Nasdaq to append a new 
modifier to trade reports of pre-open and after-hours trades not 
submitted to Nasdaq's Automated Confirmation Transaction Service 
(``ACT'') within 90 seconds after execution, and to require members to: 
(1) Include the time of execution on all reports submitted to ACT; (2) 
append the .W modifier to reports of ``stop stock transactions;'' (3) 
append the .W modifier, as appropriate, to reports submitted to ACT 
after 5:15 p.m.; \3\ and (4) append the .PRP modifier to reports of 
transactions in listed securities that are executed at a price that is 
based on a prior point in time. On February 5, 2004, Nasdaq amended the 
proposed rule change.\4\ The proposed rule change, as amended, was 
published for notice and comment in the Federal Register on March 17, 
2004.\5\ The Commission received no comments on the proposal. This 
order approves the proposed rule change, as amended.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Nasdaq also is proposing to clarify that members must append 
the .W modifier to a trade report if a trade can be properly 
reported with both a .T modifier and a .W modifier. This 
clarification is necessary because ACT can accept only one modifier 
per trade report. See infra note 14.
    \4\ See February 4, 2004 letter from Peter R. Geraghty, 
Associate Vice President and Associate General Counsel, Nasdaq, to 
Katherine A. England, Assistant Director, Division of Market 
Regulation, Commission and attachments (``Amendment No. 1''). 
Amendment No. 1 completely replaced and superseded the original 
proposed rule change.
    \5\ See Securities Exchange Act Release No. 49404 (March 11, 
2004), 69 FR 12727.
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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 association,\6\ the 
requirements of section 15A of the Act,\7\ in general, and section 
15A(b)(6) of the Act,\8\ in particular, in that it is designed to 
prevent fraudulent and manipulative acts and practices, to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, and to protect investors and 
the public interest. The Commission believes the proposed rule change 
will improve the quality of information disseminated by Nasdaq about 
the prices at which stocks are trading in its market.
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    \6\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78o-3.
    \8\ 15 U.S.C. 78o-3(b)(6).
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    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\9\ that the proposed rule change (SR-NASD-2003-159), as amended, 
be, and it hereby is, approved.
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    \9\ 15 U.S.C. 78s(b)(2).
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    For the Commission, by the Division of Market Regulation, pursuant 
to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-9423 Filed 4-23-04; 8:45 am]
BILLING CODE 8010-01-P