[Federal Register Volume 70, Number 96 (Thursday, May 19, 2005)]
[Notices]
[Pages 28965-28967]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-2501]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51689; File No. SR-Amex-2005-039]


Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to Revisions to the Series 4 Examination Program

May 12, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on April 8, 2005, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by Amex. Amex has 
designated the proposed rule change as one constituting a stated 
policy, practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule of Amex pursuant to 
Section 19(b)(3)(A)(i) of the Act \3\ and Rule 19b-4(f)(1) 
thereunder,\4\ which renders the proposal effective upon filing with 
the Commission. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(i).
    \4\ 17 CFR 240.19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Amex is filing revisions to the study outline and selection 
specifications for the Limited Principal--Registered Options (Series 4) 
examination (``Series 4 Examination''). The proposed revisions update 
the material to reflect changes to the laws, rules, and regulations 
covered by the Series 4 Examination.

[[Page 28966]]

    The revised study outline is filed with the proposed rule change. 
However, Amex has omitted the Series 4 Examination selection 
specifications from this filing and has submitted the specifications 
under separate cover to the Commission with a request for confidential 
treatment pursuant to Rule 24b-2 under the Act.\5\
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    \5\ 17 CFR 240.24b-2.
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, Amex included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. Amex has prepared summaries, set forth in Sections A, B, 
and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Amex Rule 920 states that a member organization shall not transact 
any business with the public in option contracts unless those persons 
engaged in the management of the member organization's business 
pertaining to option contracts are registered with and approved by the 
Exchange as Options Principals. Additionally, no individual member 
shall transact any business directly with the public in option 
contracts unless he is registered with and approved by the Exchange as 
an Options Principal. The Series 4 Examination tests a candidate's 
knowledge of options trading generally, the Amex rules applicable to 
the trading of option contracts, and the rules of registered clearing 
agencies for options. The Series 4 Examination covers, among other 
things, equity options, foreign currency options, index options, and 
options on government and mortgage-backed securities.
    The Series 4 Examination is shared by the Amex and the following 
SROs: the National Association of Securities Dealers, Inc. (``NASD''), 
the Chicago Board Options Exchange, Incorporated (``CBOE''), the New 
York Stock Exchange, Inc. (``NYSE''), the Pacific Exchange, Inc. 
(``PCX''), and the Philadelphia Stock Exchange, Inc. (``PHLX''). NASD 
has filed with the Commission similar revisions to the study outline 
and selection specifications for the Series 4 Examination,\6\ and Amex 
understands that the other SROs will be filing similar proposals 
shortly.
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    \6\ See Securities Exchange Act Release No. 51216 (February 16, 
2005), 70 FR 8866 (February 23, 2005) (SR-NASD-2005-025).
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    A committee of industry representatives, together with the staff of 
Amex and the SROs, recently undertook a periodic review of the Series 4 
Examination and study outline and selection specifications. As a result 
of this review and as part of an ongoing effort to align the Series 4 
Examination more closely to the supervisory duties of a Series 4 
principal, Amex is proposing to modify the content of the Series 4 
Examination to track the functional workflow of a Series 4 principal. 
More specifically, Amex is proposing to revise the main section 
headings and the number of questions on each section of the Series 4 
Examination study outline as follows: Options Investment Strategies, 
decreased from 35 to 34 questions; Supervision of Sales Activities and 
Trading Practices, increased from 71 to 75 questions; and Supervision 
of Employees, Business Conduct, and Recordkeeping and Reporting 
Requirements, decreased from 19 to 16. The revised Series 4 Examination 
continues to cover the areas of knowledge required to supervise options 
activities.
    Amex is proposing similar changes to the corresponding sections of 
the Series 4 Examination selection specifications and question bank. 
The number of questions on the Series 4 Examination will remain at 125 
and candidates will have three hours to complete the exam. Also, each 
candidate must correctly answer 70 percent of the questions to receive 
a passing grade.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6 of the Act \7\ in general and furthers the objectives of 
Section 6(c)(3) \8\ which authorize Amex to prescribe standards of 
training, experience and competence for persons associated with Amex 
members.
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    \7\ 15 U.S.C. 78f.
    \8\ 15 U.S.C. 78f(c)(3).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change will impose no 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act, as amended.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received by the 
Exchange on this proposal.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The proposed rule change has become effective pursuant to Section 
19(b)(3)(A)(i) of the Act \9\ and Rule 19b-4(f)(1) thereunder,\10\ in 
that the proposed rule change constitutes a stated policy, practice, or 
interpretation with respect to the meaning, administration, or 
enforcement of an existing rule of the Amex. NASD proposes to implement 
its revisions to the study outline and selection specifications with 
respect to the Series 4 Examination by no later than April 29, 2005. 
Amex will announce the revisions to the study outline and selection 
specifications for the Series 4 Examination and the implementation date 
in a Notice to Members prior to the implementation date.\11\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(i).
    \10\ 17 CFR 240.19b-4(f)(1).
    \11\ See Securities Exchange Act Release No. 51690 (May 12, 
2005) (SR-Amex-2005-045) (delaying implementation of this change).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-Amex-2005-039 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.

[[Page 28967]]

    All submissions should refer to File Number SR-Amex-2005-039. This 
filenumber should be included on the subject line if e-mail is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for inspection and 
copying at the principal office of the Amex. All comments received will 
be posted without change; the Commission does not edit personal 
identifying information from submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to the File Number SR-Amex-2005-039 and should be 
submitted on or before June 9, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E5-2501 Filed 5-18-05; 8:45 am]
BILLING CODE 8010-01-P