[Federal Register Volume 70, Number 66 (Thursday, April 7, 2005)]
[Notices]
[Page 17745]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-1579]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51456: File No. SR-NSX-2004-07]


Self-Regulatory Organizations; National Stock Exchange; Order 
Approving Proposed Rule Change Relating to Non-Member Give-Ups

March 31, 2005.
    On August 31, 2004, the National Stock Exchange\SM\ (``NSX\SM\'') 
submitted to 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 
relating to non-member give-ups. On December 3, 2004, the NSX\SM\ filed 
Amendment No. 1 to the proposed rule change. The Commission published 
the proposed rule change, as amended for comment in the Federal 
Register on December 29, 2004.\3\ The Commission did not receive any 
comments on the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 50898 (December 21, 
2004), 69 FR 78028.
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    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder that are applicable to a national 
securities exchange.\4\ In particular, the Commission finds that the 
proposed rule change is consistent with Section 6(b)(5) of the Act,\5\ 
which requires, among other things, that the rules of the NSX\SM\ 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. The Commission believes that 
permitting NSX\SM\ members to give-up non-NSX\SM\ members' clearing 
numbers for purposes of clearing and settling trades should add 
transparency to trading on the NSX\SM\ and should eliminate unnecessary 
steps in clearing and settling these trades. The proposed rule requires 
that the NSX\SM\ member clearing firm accept financial responsibility 
for all transactions with non-members. It further requires non-members 
to enter into a contract consenting to the disciplinary jurisdiction of 
the NSX\SM\. This requirement should provide an adequate level of 
control by the NSX\SM\ over non-members engaging in transactions on the 
NSX\SM\.
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    \4\ In approving the proposed rule change, the Commission notes 
that it has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\6\ that the proposed rule change (SR-NSX-20004-07) be, and it 
hereby is, approved.
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    \6\ 15 U.S.C. 78s(b)(2).

    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).

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-1579 Filed 4-6-05; 8:45 am]
BILLING CODE 8010-01-P