[Federal Register Volume 75, Number 5 (Friday, January 8, 2010)]
[Notices]
[Pages 1099-1101]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-79]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61272; File No. SR-NYSEAmex-2009-99]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NYSE Amex LLC Deleting Rule 
445--NYSE Amex Equities and Adopting New Rule 3310--NYSE Amex Equities 
To Correspond With Rule Changes Filed by the Financial Industry 
Regulatory Authority, Inc.

December 31, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on December 31, 2009, NYSE Amex LLC (the ``Exchange'' or 
``NYSE Amex'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been substantially prepared by the Exchange. 
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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to delete Rule 445--NYSE Amex Equities and 
adopt new Rule 3310--NYSE Amex Equities to correspond with rule changes 
filed by the Financial Industry Regulatory Authority, Inc. (``FINRA'') 
and approved by the Commission.\4\ The text of the proposed rule change 
is available at the Exchange, the Commission's Public Reference Room, 
and http://www.nyse.com.
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    \4\ See Securities Exchange Act Release No. 60645 (September 10, 
2009), 74 FR 47630 (September 16, 2009) (order approving SR-FINRA-
2009-039).
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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, the Exchange 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 those statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant parts of such 
statements.

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

1. Purpose
    The purpose of the proposed rule changes is to delete Rule 445--
NYSE Amex Equities (Anti-Money Laundering Compliance Program) and adopt 
new Rule 3310--NYSE Amex Equities (Anti-Money Laundering Compliance 
Program) to correspond with rule changes filed by FINRA and approved by 
the Commission.

Background

    On July 30, 2007, FINRA's predecessor, the National Association of 
Securities Dealers, Inc. (``NASD''), and NYSE Regulation, Inc. 
(``NYSER'') consolidated their member firm regulation operations into a 
combined organization, FINRA. Pursuant to Rule 17d-2 under the Act, the 
New York Stock Exchange LLC (``NYSE''), NYSER and FINRA entered into an 
agreement (the ``Agreement'') to reduce regulatory duplication for 
their members by allocating to FINRA certain regulatory 
responsibilities for certain NYSE rules and rule interpretations 
(``FINRA Incorporated NYSE Rules''). The Exchange became a party to the 
Agreement effective December 15, 2008.\5\
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    \5\ See Securities Exchange Act Release Nos. 56148 (July 26, 
2007), 72 FR 42146 (August 1, 2007) (order approving the Agreement); 
56147 (July 26, 2007), 72 FR 42166 (August 1, 2007) (SR-NASD-2007-
054) (order approving the incorporation of certain NYSE Rules as 
``Common Rules''); and 60409 (July 30, 2009), 74 FR 39353 (August 6, 
2009) (order approving the amended and restated Agreement, adding 
NYSE Amex LLC as a party). Paragraph 2(b) of the Agreement sets 
forth procedures regarding proposed changes by FINRA, NYSE or NYSE 
Amex to the substance of any of the Common Rules.

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[[Page 1100]]

    As part of its effort to reduce regulatory duplication and relieve 
firms that are members of FINRA, NYSE and NYSE Amex of conflicting or 
unnecessary regulatory burdens, FINRA is now engaged in the process of 
reviewing and amending the NASD and FINRA Incorporated NYSE Rules in 
order to create a consolidated FINRA rulebook.\6\
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    \6\ FINRA's rulebook currently has three sets of rules: (1) NASD 
Rules, (2) FINRA Incorporated NYSE Rules, and (3) consolidated FINRA 
Rules. The FINRA Incorporated NYSE Rules apply only to those members 
of FINRA that are also members of the NYSE, while the consolidated 
FINRA Rules apply to all FINRA members. For more information about 
the FINRA rulebook consolidation process, see FINRA Information 
Notice, March 12, 2008.
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Proposed Conforming Amendments to NYSE Rules

    FINRA adopted, subject to certain amendments, NASD Rule 3011 (Anti-
Money Laundering Compliance Program) and related Interpretive Material 
NASD IM-3011-1 and 3011-2 as consolidated FINRA Rule 3310 (Anti-Money 
Laundering Compliance Program), and deleted FINRA Incorporated NYSE 
Rule 445 (Anti-Money Laundering Compliance Program) as duplicative of 
the new Rule.\7\
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    \7\ See Securities Exchange Act Release No. 60645 (September 10, 
2009), 74 FR 47630 (September 16, 2009).
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    Because it is substantially similar to the provisions of FINRA Rule 
3310, FINRA deleted FINRA Incorporated NYSE Rule 445. In particular, 
FINRA Incorporated NYSE Rule 445(1)-(5) are substantially the same as 
consolidated FINRA Rule 3310(a)-(e). In addition, Supplementary 
Material .10 and .20 to FINRA Incorporated NYSE Rule 445 are 
substantially the same as Supplementary Material .01 to consolidated 
FINRA Rule 3310. Finally, read together, part (4) and Supplementary 
Material .30 to FINRA Incorporated NYSE Rule 445 are substantially the 
same as Supplementary Material .02 to consolidated FINRA Rule 3310 with 
respect to the notification of AML compliance person designations.\8\
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    \8\ Id.
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    To harmonize the NYSE Amex Equities Rules with the approved 
consolidated FINRA Rules, the Exchange correspondingly proposes to 
delete Rule 445--NYSE Amex Equities and replace it with proposed Rule 
3310--NYSE Amex Equities, which is substantially similar to the new 
FINRA Rule.\9\ As proposed, Rule 3310--NYSE Amex Equities adopts the 
same language as FINRA Rule 3310, except for substituting for or adding 
to, as needed, the term ``member organization'' for the term 
``member,'' and making corresponding technical changes that reflect the 
difference between NYSE Amex's and FINRA's membership structures. In 
addition, in Supplementary Material .02 to proposed Rule 3310, the 
Exchange added a cross-reference to Rule 416A--NYSE Amex Equities to 
ensure that those Exchange members and member organizations that are 
not FINRA members are required to update the contact information for 
anti-money laundering compliance personnel in accordance with NYSE Amex 
Equities Rules.
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    \9\ NYSE has submitted a companion rule filing amending its 
rules in accordance with FINRA's rule changes. See SR-NYSE-2009-134.
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    Finally, in order to ensure that both proposed Rule 3310--NYSE Amex 
Equities and FINRA Rule 3310 are fully harmonized, the Exchange also 
proposes to add Supplementary Material .03 to Rule 3310--NYSE Amex 
Equities to provide that, for the purposes of the rule, the term 
``associated person of the member or member organization'' shall have 
the same meaning as the terms ``person associated with a member'' or 
``associated person of a member'' as defined in Article I (rr) of the 
FINRA By-Laws.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\10\ in general, and further the 
objectives of Section 6(b)(5) of the Act,\11\ in particular, because it 
is designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, and, in general, to protect investors and the 
public interest.
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    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed rule change supports the 
objectives of the Act by providing greater harmonization between NYSE 
Amex Equities Rules and FINRA Rules of similar purpose, resulting in 
less burdensome and more efficient regulatory compliance for joint 
members. To the extent the Exchange's proposal differs from FINRA' 
version of the Rules, such changes are technical in nature and do not 
change the substance of the proposed NYSE Amex Equities Rules.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \12\ and Rule 19b-4(f)(6) thereunder.\13\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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    \12\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \13\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b4(f)(6)(iii),\15\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative immediately upon filing. The Commission notes that 
the proposed rule change is substantially identical to a rule change 
proposed by FINRA and approved by the Commission after an opportunity 
for public comment, and does not raise any new substantive issues.\16\ 
For these reasons, the Commission believes that waiver of the 30-day 
operative delay is consistent with the protection of investors and the 
public interest because it will promote

[[Page 1101]]

greater harmonization between NYSE Amex Equities Rules and FINRA Rules 
of similar purpose, resulting in less burdensome and more efficient 
regulatory compliance for joint members and greater harmonization 
between NYSE Amex Equities Rules and FINRA Rules. Therefore, the 
Commission designates the proposed rule change effective and operative 
upon filing.\17\
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    \14\ 17 CFR 240.19b-4(f)(6).
    \15\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the self-regulatory organization to submit to 
the Commission written notice of its intent to file the proposed 
rule change, along with a brief description and text of the proposed 
rule change, at least five business days prior to the date of filing 
of the proposed rule change, or such shorter time as designated by 
the Commission. The Exchange has satisfied this requirement.
    \16\ See supra note 7.
    \17\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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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-NYSEAmex-2009-99 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEAmex-2009-99. This 
file number 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 in the Commission's Public Reference Room, 100 F Street, 
NE., Washington, DC 20549, on official business days between the hours 
of 10 a.m. and 3 p.m. Copies of the filing will also be available for 
inspection and copying at the NYSE's principal office and on its 
Internet Web site at http://www.nyse.com. 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 File Number SR-NYSEAmex-2009-99 and should be submitted 
on or before January 29, 2010.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-79 Filed 1-7-10; 8:45 am]
BILLING CODE 8011-01-P