9976 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

15See supra note 13 (citing to Securities 

Exchange Act Release No. 58765). 

16 15 U.S.C. 78q(d). 

17 17 CFR 200.30–3(a)(34). 

1 15 U.S.C. 78q(d). 

2 17 CFR 240.17d–2. 

3 15 U.S.C. 78s(g)(1). 

4 15 U.S.C. 78q(d). 

5 15 U.S.C. 78s(g)(2). 

* * * * * 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing. 

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 rulecomments@sec.gov. Please include File 

Number 4–551 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 4–551. 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 

plan that are filed with the Commission, 

and all written communications relating 

to the proposed plan 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 Web site viewing and 

printing 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 plan also 

will be available for inspection and 

copying at the principal offices of 

Amex, BATS, C2, CBOE, ISE, FINRA, 

Arca, NASDAQ, BX and Phlx. 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 4–551 and should be submitted 

on or before March 25, 2010. 

V. Discussion 

The Commission continues to believe 

that the Plan, as proposed to be 

amended, is an achievement in 

cooperation among the SRO 

participants, and will reduce 

unnecessary regulatory duplication by 

allocating to the designated SRO the 

responsibility for certain options-related 

market surveillance matters that would 

otherwise be performed by multiple 

SROs. The Plan promotes efficiency by 

reducing costs to firms that are members 

of more than one of the SRO 

participants. In addition, because the 

SRO participants coordinate their 

regulatory functions in accordance with 

the Plan, the Plan promotes, and will 

continue to promote, investor 

protection. 

Under paragraph (c) of Rule 17d–2, 

the Commission may, after appropriate 

notice and comment, declare a plan, or 

any part of a plan, effective. In this 

instance, the Commission believes that 

appropriate notice and comment can 

take place after the proposed 

amendment is effective. The purpose of 

the amendment is to add BATS 

Exchange, Inc. and C2 Options 

Exchange, Incorporated as SRO 

participants and to reflect the name 

changes of Amex and BX. By declaring 

it effective today, the amended Plan can 

become effective and be implemented 

without undue delay. In addition, the 

Commission notes that the prior version 

of this Plan was published for comment, 

and the Commission did not receive any 

comments thereon.15 Finally, the 

Commission does not believe that the 

amendment to the Plan raises any new 

regulatory issues that the Commission 

has not previously considered. 

VI. Conclusion 

This order gives effect to the amended 

Plan submitted to the Commission that 

is contained in File No. 4–551. 

It is therefore ordered, pursuant to 

Section 17(d) of the Act,16 that the Plan, 

as amended by and between the Amex, 

BATS, C2, CBOE, ISE, FINRA, Arca, 

NASDAQ, BX and Phlx filed with the 

Commission pursuant to Rule 17d–2 on 

February 4, 2010 is hereby approved 

and declared effective. 

It is further ordered that those SRO 

participants that are not the DOSR as to 

a particular common member are 

relieved of those regulatory 

responsibilities allocated to the common 

member’s DOSR under the amended 

Plan to the extent of such allocation. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–4455 Filed 3–3–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61589; File No. S7–966] 

Program for Allocation of Regulatory 

Responsibilities Pursuant to Rule 17d– 

2; Notice of Filing and Order 

Approving and Declaring Effective an 

Amendment to the Plan for the 

Allocation of Regulatory 

Responsibilities Among the BATS 

Exchange, Inc., the Chicago Board 

Options Exchange, Incorporated, C2 

Options Exchange, Incorporated, the 

International Securities Exchange, 

LLC, Financial Industry Regulatory 

Authority, Inc., the New York Stock 

Exchange LLC, NYSE Amex LLC, 

NYSE Arca, Inc., The NASDAQ Stock 

Market LLC, NASDAQ OMX BX, Inc., 

and NASDAQ OMX PHLX, Inc. 

Concerning Options-Related Sales 

Practice Matters 

February 25, 2010. 

Notice is hereby given that the 

Securities and Exchange Commission 

(‘‘Commission’’) has issued an Order, 

pursuant to Section 17(d) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 approving and declaring 

effective an amendment to the plan for 

allocating regulatory responsibility filed 

pursuant to Rule 17d–2 of the Act,2 by 

the BATS Exchange, Inc. (‘‘BATS’’), the 

Chicago Board Options Exchange, 

Incorporated (‘‘CBOE’’), C2 Options 

Exchange, Incorporated (‘‘C2’’), the 

International Securities Exchange, LLC 

(‘‘ISE’’), Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’), the New York 

Stock Exchange LLC (‘‘NYSE’’), NYSE 

Amex LLC (‘‘Amex’’), NYSE Arca, 

Inc.(‘‘Arca’’), The NASDAQ Stock 

Market LLC (‘‘NASDAQ’’), NASDAQ 

OMX BX, Inc. (‘‘BX’’), and NASDAQ 

OMX PHLX, Inc. (‘‘Phlx’’) (collectively, 

‘‘SRO participants’’). 

I. Introduction 

Section 19(g)(1) of the Act,3 among 

other things, requires every selfregulatory organization (‘‘SRO’’) 

registered as either a national securities 

exchange or national securities 

association to examine for, and enforce 

compliance by, its members and persons 

associated with its members with the 

Act, the rules and regulations 

thereunder, and the SRO’s own rules, 

unless the SRO is relieved of this 

responsibility pursuant to Section 

17(d) 4 or Section 19(g)(2) 5 of the Act. 

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Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 9977 

6 15 U.S.C. 78q(d)(1). 

7See Securities Act Amendments of 1975, Report 

of the Senate Committee on Banking, Housing, and 

Urban Affairs to Accompany S. 249, S. Rep. No. 94– 

75, 94th Cong., 1st Session 32 (1975). 8 17 CFR 240.17d–1 and 17 CFR 240.17d–2, 

respectively. 

9See Securities Exchange Act Release No. 12352 

(April 20, 1976), 41 FR 18808 (May 7, 1976). 

10See Securities Exchange Act Release No. 12935 

(October 28, 1976), 41 FR 49091 (November 8, 

1976). 

11See Securities Exchange Act Release No. 20158 

(September 8, 1983), 48 FR 41256 (September 14, 

1983). 

12See Securities Exchange Act Release No. 42816 

(May 23, 2000), 65 FR 34759 (May 31, 2000). 

13See Securities Exchange Act Release No. 46800 

(November 8, 2002), 67 FR 69774 (November 19, 

2002). 

14See Securities Exchange Act Release No. 49197 

(February 5, 2004), 69 FR 7046 (February 12, 2004). 

15See Securities Exchange Act Release No. 55532 

(March 26, 2007), 72 FR 15729 (April 2, 2007). 

16See Securities Exchange Act Release No. 57987 

(June 18, 2008), 73 FR 36156 (June 25, 2008). 

Without this relief, the statutory 

obligation of each individual SRO could 

result in a pattern of multiple 

examinations of broker-dealers that 

maintain memberships in more than one 

SRO (‘‘common members’’). Such 

regulatory duplication would add 

unnecessary expenses for common 

members and their SROs. 

Section 17(d)(1) of the Act 6 was 

intended, in part, to eliminate 

unnecessary multiple examinations and 

regulatory duplication.7 With respect to 

a common member, Section 17(d)(1) 

authorizes the Commission, by rule or 

order, to relieve an SRO of the 

responsibility to receive regulatory 

reports, to examine for and enforce 

compliance with applicable statutes, 

rules, and regulations, or to perform 

other specified regulatory functions. 

To implement Section 17(d)(1), the 

Commission adopted two rules: Rule 

17d–1 and Rule 17d–2 under the Act.8

Rule 17d–1 authorizes the Commission 

to name a single SRO as the designated 

examining authority (‘‘DEA’’) to examine 

common members for compliance with 

the financial responsibility 

requirements imposed by the Act, or by 

Commission or SRO rules.9 When an 

SRO has been named as a common 

member’s DEA, all other SROs to which 

the common member belongs are 

relieved of the responsibility to examine 

the firm for compliance with the 

applicable financial responsibility rules. 

On its face, Rule 17d–1 deals only with 

an SRO’s obligations to enforce member 

compliance with financial responsibility 

requirements. Rule 17d–1 does not 

relieve an SRO from its obligation to 

examine a common member for 

compliance with its own rules and 

provisions of the Federal securities laws 

governing matters other than financial 

responsibility, including sales practices 

and trading activities and practices. 

To address regulatory duplication in 

these and other areas, the Commission 

adopted Rule 17d–2 under the Act.10

Rule 17d–2 permits SROs to propose 

joint plans for the allocation of 

regulatory responsibilities with respect 

to their common members. Under 

paragraph (c) of Rule 17d–2, the 

Commission may declare such a plan 

effective if, after providing for notice 

and comment, it determines that the 

plan is necessary or appropriate in the 

public interest and for the protection of 

investors, to foster cooperation and 

coordination among the SROs, to 

remove impediments to, and foster the 

development of, a national market 

system and a national clearance and 

settlement system, and is in conformity 

with the factors set forth in Section 

17(d) of the Act. Commission approval 

of a plan filed pursuant to Rule 17d–2 

relieves an SRO of those regulatory 

responsibilities allocated by the plan to 

another SRO. 

II. The Plan 

On September 8, 1983, the 

Commission approved the SRO 

participants’ plan for allocating 

regulatory responsibilities pursuant to 

Rule 17d–2.11 On May 23, 2000, the 

Commission approved an amendment to 

the plan that added the ISE as a 

participant.12 On November 8, 2002, the 

Commission approved another 

amendment that replaced the original 

plan in its entirety and, among other 

things, allocated regulatory 

responsibilities among all the 

participants in a more equitable 

manner.13 On February 5, 2004, the 

parties submitted an amendment to the 

plan, primarily to include the BSE, 

which was establishing a new options 

trading facility to be known as the 

Boston Options Exchange (‘‘BOX’’), as an 

SRO participant.14 On December 5, 

2007, the parties submitted an 

amendment to the plan to, among other 

things, provide that the National 

Association of Securities Dealers 

(‘‘NASD’’) (n/k/a the Financial Industry 

Regulatory Authority, Inc. or ‘‘FINRA’’) 

and NYSE are Designated Options 

Examining Authorities under the plan.15

On June 5, 2008, the parties submitted 

an amendment to the plan primarily to 

remove the NYSE as a Designated 

Options Examining Authority, leaving 

FINRA as the sole Designated Options 

Examining Authority for all common 

members that are members of FINRA.16

The plan reduces regulatory 

duplication for a large number of firms 

currently members of two or more of the 

SRO participants by allocating 

regulatory responsibility for certain 

options-related sales practice matters to 

one of the SRO participants. Generally, 

under the current plan, the SRO 

participant responsible for conducting 

options-related sales practice 

examinations of a firm, and 

investigating options-related customer 

complaints and terminations for cause 

of associated persons of that firm, is 

known as the firm’s ‘‘Designated 

Options Examining Authority’’ 

(‘‘DOEA’’). Pursuant to the current plan, 

any other SRO of which the firm is a 

member is relieved of these 

responsibilities during the period in 

which the firm is assigned to another 

SRO acting as that firm’s DOEA. 

III. Proposed Amendment to the Plan 

On February 9, 2010, the parties 

submitted a proposed amendment to the 

plan. The primary purpose of the 

amendment is to add BATS Exchange, 

Inc. and C2 Options Exchange, 

Incorporated as an SRO participant and 

to reflect the name changes of the 

American Stock Exchange LLC to the 

NYSE Amex LLC, the Boston Stock 

Exchanges, Inc., to the NASDAQ OMX 

BX, Inc. and the Philadelphia Stock 

Exchange, Inc. to the NASDAQ OMX 

PHLX, Inc. The amended agreement 

replaces the previous agreement in its 

entirety. The text of the proposed 

amended 17d–2 plan is as follows 

(additions are italicized; deletions are 

[bracketed]): 

* * * * * 

Agreement by and among [the American 

Stock Exchange, LLC, the Boston Stock] 

BATS Exchange, Inc., the Chicago Board 

Options Exchange, [Inc.] Incorporated, 

C2 Options Exchange, Incorporated, the 

International Securities Exchange, LLC, 

Financial Industry Regulatory 

Authority, Inc., the New York Stock 

Exchange[,] LLC, the NYSE Amex LLC, 

the NYSE Arca, Inc., The NASDAQ 

Stock Market LLC, NASDAQ OMX BX, 

Inc. and the [Philadelphia Stock 

Exchange] NASDAQ OMX PHLX, Inc. 

Pursuant to Rule 17d–2 under the 

Securities Exchange Act of 1934. 

This agreement (‘‘Agreement’’), by and 

among [the American Stock Exchange, 

LLC, the Boston Stock]BATS Exchange, 

Inc., the Chicago Board Options 

Exchange, [Inc.]Incorporated, C2 

Options Exchange, Incorporated, the 

International Securities Exchange, LLC, 

Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’), The 

NASDAQ Stock Market LLC 

(‘‘NASDAQ’’), NASDAQ OMX BX, Inc., 

the New York Stock Exchange LLC 

(‘‘NYSE’’), the NYSE Amex LLC, the 

NYSE Arca, Inc., and the [Philadelphia 

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9978 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

1 In the case of [the Boston Stock 

Exchange]NASDAQ OMX BX, Inc.[,] and NASDAQ 

members are those persons who are options 

participants (as defined in the BOX and NASDAQ 

Options Market Rules). 

Stock Exchange]NASDAQ OMX PHLX, 

Inc., hereinafter collectively referred to 

as the Participants, is made this 

[27th]5th day of [December, 

2008]February, 2010, pursuant to the 

provisions of Rule 17d–2 under the 

Securities Exchange Act of 1934 (the 

‘‘Exchange Act’’), which allows for plans 

among self-regulatory organizations to 

allocate regulatory responsibility. This 

Agreement shall be administered by a 

committee known as the Options SelfRegulatory Council (the ‘‘Council’’). 

This Agreement amends and restates 

the agreement entered into among the 

Participants on [December 27, 2007]June 

5, 2008, entitled ‘‘Agreement by and 

among the American Stock Exchange, 

LLC, the Boston Stock Exchange, Inc., 

the Chicago Board Options Exchange, 

[Inc.] Incorporated, the International 

Securities Exchange, LLC, Financial 

Industry Regulatory Authority, Inc., the 

New York Stock Exchange[,] LLC, the 

NYSE Arca, Inc., the NASDAQ Stock 

Market LLC, and the Philadelphia Stock 

Exchange, Inc., Pursuant to Rule 17d–2 

under the Securities Exchange Act of 

1934.’’ 

Whereas, the Participants are desirous 

of allocating regulatory responsibilities 

with respect to broker-dealers, and 

persons associated therewith, that are 

members 1 of more than one Participant 

(the ‘‘Common Members’’) and conduct 

a public business for compliance with 

Common Rules (as hereinafter defined) 

relating to the conduct by broker-dealers 

of accounts for listed options, index 

warrants, currency index warrants and 

currency warrants (collectively, 

‘‘Covered Securities’’); and 

Whereas, the Participants are desirous 

of executing a plan for this purpose 

pursuant to the provisions of Rule 17d– 

2 and filing such plan with the 

Securities and Exchange Commission 

(‘‘SEC’’ or the ‘‘Commission’’) for its 

approval; 

Now, therefore, in consideration of 

the mutual covenants contained 

hereafter, the Participants agree as 

follows: 

I. As used herein the term Designated 

Options Examining Authority (‘‘DOEA’’) 

shall mean: (1) FINRA insofar as it shall 

perform Regulatory Responsibility (as 

hereinafter defined) for its broker-dealer 

members that also are members of 

another Participant or (2) the Designated 

Examination Authority (‘‘DEA’’) 

pursuant to SEC Rule 17d–1 under the 

Securities Exchange Act (‘‘Rule 17d–1’’) 

for a broker-dealer that is a member of 

a more than one Participant (but not a 

member of FINRA). 

II. As used herein, the term 

‘‘Regulatory Responsibility’’ shall mean 

the examination and enforcement 

responsibilities relating to compliance 

by Common Members with the rules of 

the applicable Participant that are 

substantially similar to the rules of the 

other Participants (the ‘‘Common 

Rules’’), insofar as they apply to the 

conduct of accounts for Covered 

Securities. A list of the current Common 

Rules of each Participant applicable to 

the conduct of accounts for Covered 

Securities is attached hereto as Exhibit 

A. Each year within 30 days of the 

anniversary date of the commencement 

of operation of this Agreement, each 

Participant shall submit in writing to 

FINRA and each DEA performing as a 

DOEA for any members of such 

Participant any revisions to Exhibit A 

reflecting changes in the rules of the 

Participant, and confirm that all other 

rules of the Participant listed in Exhibit 

A continue to meet the definition of 

Common Rules as defined in this 

Agreement. Within 30 days from the 

date that FINRA and each DEA 

performing as a DOEA has received 

revisions and/or confirmation that no 

change has been made to Exhibit A from 

all Participants, FINRA and each DEA 

performing as a DOEA shall confirm in 

writing to each Participant whether the 

rules listed in any updated Exhibit A are 

Common Rules as defined in this 

Agreement. Notwithstanding anything 

herein to the contrary, it is explicitly 

understood that the term ‘‘Regulatory 

Responsibility’’ does not include, and 

each of the Participants shall (unless 

allocated pursuant to Rule 17d–2 

otherwise than under this Agreement) 

retain full responsibility for, each of the 

following: 

(a) Surveillance and enforcement with 

respect to trading activities or practices 

involving its own marketplace, 

including without limitation its rules 

relating to the rights and obligations of 

specialists and other market makers; 

(b) Registration pursuant to its 

applicable rules of associated persons; 

(c) Discharge of its duties and 

obligations as a DEA; and 

(d) Evaluation of advertising, 

responsibility for which shall remain 

with the Participant to which a 

Common Member submits same for 

approval. 

III. Apparent violations of another 

Participant’s rules discovered by a 

DOEA, but which rules are not within 

the scope of the discovering DOEA’s 

Regulatory Responsibility, shall be 

referred to the relevant Participant for 

such action as the Participant to which 

such matter has been referred deems 

appropriate. Notwithstanding the 

foregoing, nothing contained herein 

shall preclude a DOEA in its discretion 

from requesting that another Participant 

conduct an enforcement proceeding on 

a matter for which the requesting DOEA 

has Regulatory Responsibility. If such 

other Participants agree, the Regulatory 

Responsibility in such case shall be 

deemed transferred to the accepting 

Participant and confirmed in writing by 

the Participants involved. Each 

Participant agrees, upon request, to 

make available promptly all relevant 

files, records and/or witnesses necessary 

to assist another Participant in an 

investigation or enforcement 

proceeding. 

IV. The Council shall be composed of 

one representative designated by each of 

the Participants. Each Participant shall 

also designate one or more persons as its 

alternate representative(s). In the 

absence of the representative of a 

Participant, such alternate 

representative shall have the same 

powers, duties and responsibilities as 

the representative. Each Participant 

may, at any time, by notice to the then 

Chair of the Council, replace its 

representative and/or its alternate 

representative on such Council. A 

majority of the Council shall constitute 

a quorum and, unless specifically 

otherwise required, the affirmative vote 

of a majority of the Council members 

present (in person, by telephone or by 

written consent) shall be necessary to 

constitute action by the Council. The 

representative from FINRA shall serve 

as Chair of the Council. All notices and 

other communications for the Council 

shall be sent to it in care of the Chair 

or to each of the representatives. 

V. The Council shall determine the 

times and locations of Council meetings, 

provided that the Chair, acting alone, 

may also call a meeting of the Council 

in the event the Chair determines that 

there is good cause to do so. To the 

extent reasonably possible, notice of any 

meeting shall be given at least tenbusiness days prior thereto. 

Notwithstanding anything herein to the 

contrary, representatives shall always be 

given the option of participating in any 

meeting telephonically at their own 

expense rather than in person. 

VI. FINRA shall have Regulatory 

Responsibility for all Common Members 

that are members of FINRA. For the 

purpose of fulfilling the Participants’ 

Regulatory Responsibilities for Common 

Members that are not members of 

FINRA, the Participant that is the DEA 

shall serve as the DOEA. All 

Participants shall promptly notify the 

DOEAs no later than the next scheduled 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 9979 

2For purposes of complaints, they can be 

reported pursuant to Form U4, Form U5 or RE–3 

and any amendments thereto. 

meeting of any change in membership of 

Common Members. A DOEA may 

request that a Common Member that is 

allocated to it be reallocated to another 

DOEA by giving thirty days written 

notice thereof. The DOEAs in their 

discretion may approve such request 

and reallocate such Common Member to 

another DOEA. 

VII. Each DOEA shall conduct an 

examination of each Common Member. 

The Participants agree that, upon 

request, relevant information in their 

respective files relative to a Common 

Member will be made available to the 

applicable DOEA. At each meeting of 

the Council, each DOEA shall be 

prepared to report on the status of its 

examination program for the previous 

quarter and any period prior thereto that 

has not previously been reported to the 

Council. 

VIII. Each DOEA will promptly 

furnish a copy of the Examination 

report, relating to Covered Securities, of 

any examination made pursuant to the 

provisions of this Agreement to each 

other Participant of which the Common 

Member examined is a member. 

IX. Each DOEA’s Regulatory 

Responsibility shall for each Common 

Member allocated to it include 

investigations into terminations ‘‘for 

cause’’ of associated persons relating to 

Covered Securities, unless such 

termination is related solely to another 

Participant’s market. In the latter 

instance, that Participant to whose 

market the termination for cause relates 

shall discharge Regulatory 

Responsibility with respect to such 

termination for cause. In connection 

with a DOEA’s examination, 

investigation and/or enforcement 

proceeding regarding a Covered 

Security-related termination for cause, 

the other Participants of which the 

Common Member is a member shall 

furnish, upon request, copies of all 

pertinent materials related thereto in 

their possession. As used in this 

Section, ‘‘for cause’’ shall include, 

without limitation, terminations 

characterized on Form U5 under the 

label ‘‘Permitted to Resign,’’ ‘‘Discharge’’ 

or ‘‘Other.’’ 

X. Each DOEA shall discharge the 

Regulatory Responsibility for each 

Common Member allocated to it relative 

to a Covered Securities-related customer 

complaint 2 unless such complaint is 

uniquely related to another Participant’s 

market. In the latter instance, the DOEA 

shall forward the matter to that 

Participant to whose market the matter 

relates, and the latter shall discharge 

Regulatory Responsibility with respect 

thereto. If a Participant receives a 

customer complaint for a Common 

Member related to a Covered Security 

for which the Participant is not the 

DOEA, the Participant shall promptly 

forward a copy of such complaint to the 

DOEA. 

XI. Any written notice required or 

permitted to be given under this 

Agreement shall be deemed given if sent 

by certified mail, return receipt 

requested, or by a comparable means of 

electronic communication to each 

Participant entitled to receipt thereof, to 

the attention of the Participant’s 

representative on the Council at the 

Participant’s then principal office or by 

e-mail at such address as the 

representative shall have filed in writing 

with the Chair. 

XII. The Participants shall notify the 

Common Members of this Agreement by 

means of a uniform joint notice 

approved by the Council. 

XIII. This Agreement may be amended 

in writing duly approved by each 

Participant. 

XIV. Any of the Participants may 

manifest its intention to cancel its 

participation in this Agreement at any 

time by giving the Council written 

notice thereof at least 90 days prior to 

the effective date of such cancellation. 

Upon receipt of such notice the Council 

shall allocate, in accordance with the 

provisions of this Agreement, any 

Common Members for which the 

petitioning party was the DOEA. Until 

such time as the Council has completed 

the reallocation described above; the 

petitioning Participant shall retain all its 

rights, privileges, duties and obligations 

hereunder. 

XV. The cancellation of its 

participation in this Agreement by any 

Participant shall not terminate this 

Agreement as to the remaining 

Participants. This Agreement will only 

terminate following notice to the 

Commission, in writing, by the then 

Participants that they intend to 

terminate the Agreement and the 

expiration of the applicable notice 

period. Such notice shall be given at 

least six months prior to the intended 

date of termination, provided that in the 

event a notice of cancellation is received 

from a Participant that, assuming the 

effectiveness thereof, would result in 

there being just one remaining member 

of the Council, notice to the 

Commission of termination of this 

Agreement shall be given promptly 

upon the receipt of such notice of 

cancellation, which termination shall be 

effective upon the effectiveness of the 

cancellation that triggered the notice of 

termination to the Commission. 

XVI. No Participant nor the Council 

nor any of their respective directors, 

governors, officers, employees or 

representatives shall be liable to any 

other Participant in this Agreement for 

any liability, loss or damage resulting 

from or claimed to have resulted from 

any delays, inaccuracies, errors or 

omissions with respect to the provision 

of Regulatory Responsibility as provided 

hereby or for the failure to provide any 

such Responsibility, except with respect 

to such liability, loss or damages as 

shall have been suffered by one or more 

of the Participants and caused by the 

willful misconduct of one or more of the 

other participants or their respective 

directors, governors, officers, employees 

or representatives. No warranties, 

express or implied, are made by any or 

all of the Participants or the Council 

with respect to any Regulatory 

Responsibility to be performed by each 

of them hereunder. 

XVII. Pursuant to Section 17(d)(1)(A) 

of the Securities Exchange Act of 1934 

and Rule 17d–2 promulgated pursuant 

thereto, the Participants join in 

requesting the Securities and Exchange 

Commission, upon its approval of this 

Agreement or any part thereof, to relieve 

those Participants which are from time 

to time participants in this Agreement 

which are not the DOEA as to a 

Common Member of any and all 

Regulatory Responsibility with respect 

to the matters allocated to the DOEA. 

COMMON RULES

Opening of Accounts 

AMEX ........... Rules 411, 921 and 1101. 

BATS ............ Rule 26.2. 

CBOE ........... Rule 9.7. 

C2* ............... CBOE Rule 9.7. 

ISE ............... Rule 608. 

FINRA .......... Rules 2360(b)(16) and 2352. 

NYSE ........... Rule 721.1

PHLX ............ Rule 1024(b) and (c).2

NYSE ARCA Rule 9.2(a) and Rule 9.18(b). 

BX/BOX ........ Chapter XI, Section 9. 

NASDAQ ...... Chapter XI, Section 7. 

Supervision 

AMEX ........... Rules 411, 922 and 1104. 

BATS ............ Rule 26.3. 

CBOE ........... Rule 9.8. 

C2 ................. CBOE Rule 9.8. 

ISE ............... Rule 609. 

FINRA .......... Rules 2360(b)(20), 

2360(b)(17)(B), 2355 and 

2358. 

NYSE ........... N/A. 

PHLX ............ Rule 1025. 

NYSE ARCA Rules 9.2(b) and 

9.18(d)(2)(G). 

BX/BOX ........ Chapter XI, Section 10. 

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9980 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

COMMON RULES—Continued 

NASDAQ ...... Chapter XI, Section 8. 

Suitability 

AMEX ........... Rules 923 and 1102. 

BATS ............ Rule 26.4. 

CBOE ........... Rule 9.9. 

C2 ................. CBOE Rule 9.9. 

ISE ............... Rule 610. 

FINRA .......... Rule 2360(b)(19) and 2353. 

NYSE ........... Rule 723. 

PHLX ............ Rule 1026. 

NYSE ARCA Rule 9.18(c). 

BX/BOX ........ Chapter XI, Section 11. 

NASDAQ ...... Chapter XI, Section 9. 

Discretionary Accounts 

AMEX ........... Rules 421, 924 and 1103. 

BATS ............ Rule 26.5.3

CBOE ........... Rule 9.10. 

C2 ................. CBOE Rule 9.10. 

ISE ............... Rule 611. 

FINRA .......... Rules 2360(b)(18) and 2354. 

NYSE ........... N/A. 

PHLX ............ Rule 1027. 

NYSE ARCA Rule 9.18(e). 

BX/BOX ........ Chapter XI, Section 12. 

NASDAQ ...... Chapter XI, Section 10. 

Customer Communications (Advertising) 

AMEX ........... Rules 991 and 1106. 

BATS ............ Rule 26.16. 

CBOE ........... Rule 9.21.4

C2 ................. CBOE Rule 9.21.4

ISE ............... Rule 623.4

FINRA .......... Rules 2220 and 2357. 

NYSE ........... N/A. 

PHLX ............ N/A. 

NYSE ARCA N/A. 

BX/BOX ........ Chapter XI, Section 24.4

NASDAQ ...... Chapter XI, Section 22. 

Customer Complaints 

AMEX ........... Rules 932 and 1105. 

BATS ............ Rule 26.17. 

CBOE ........... Rule 9.23. 

C2 ................. CBOE Rule 9.23. 

ISE ............... Rule 625. 

FINRA .......... FINRA Rules 2360(b)(17)(A) 

and 2356 and NASD Rule 

3070(a) and (c). 

NYSE ........... Rules 732 & 351(a) and (d). 

PHLX ............ Rule 1070. 

NYSE ARCA Rule 9.18(I). 

BX/BOX ........ Chapter XI, Section 26. 

NASDAQ ...... Chapter XI, Section 24. 

Customer Statements 

AMEX ........... Rules 419 and 930. 

BATS ............ Rule 26.7. 

CBOE ........... Rule 9.12. 

C2 ................. CBOE Rule 9.12. 

ISE ............... Rule 613. 

FINRA .......... Rule 2360(b)(15). 

NYSE ........... Rule 730. 

PHLX ............ Rule 1032. 

NYSE ARCA Rule 9.18(j). 

BX/BOX ........ Chapter XI, Sections 14. 

NASDAQ ...... Chapter XI, Sections 12. 

COMMON RULES—Continued 

Confirmations 

AMEX ........... Rule 925. 

BATS ............ Rule 26.6. 

CBOE ........... Rule 9.11. 

C2 ................. CBOE Rule 9.11. 

ISE ............... Rule 612. 

FINRA .......... Rule 2360(b)(12). 

NYSE ........... Rule 725.5

PHLX ............ Rule 1028. 

NYSE ARCA Rule 9.18(f). 

BX/BOX ........ Chapter XI, Section 13. 

NASDAQ ...... Chapter XI, Section 11. 

Allocation of Exercise Assignment Notices 

AMEX ........... Rule 981. 

BATS ............ Rule 23.2. 

CBOE ........... Rule 11.2. 

C2 ................. CBOE Rule 11.2. 

ISE ............... Rule 1101. 

FINRA .......... Rule 2360(b)(23)(C). 

NYSE ........... Rule 781. 

PHLX ............ Rule 1043. 

NYSE ARCA Rule 6.25(a). 

BX/BOX ........ Chapter VII, Section 2. 

NASDAQ ...... Chapter VIII, Section 2. 

Disclosure Documents 

AMEX ........... Rules 921 and 926. 

BATS ............ Rule 26.10. 

CBOE ........... Rule 9.15. 

C2 ................. CBOE Rule 9.15. 

ISE ............... Rule 616. 

FINRA .......... Rule 2360(b)(11). 

NYSE ........... Rule 726(a) and (c). 

PHLX ............ Rule 1024(b)(v), 1029. 

NYSE ARCA Rule 9.18(g). 

BX/BOX ........ Chapter XI, Section 17. 

NASDAQ ...... Chapter XI, Section 15. 

Branch Offices of Member Organizations 

AMEX ........... Rule 922(d).6

CBOE ........... Rule 9.6. 

C2 ................. CBOE Rule 9.6. 

ISE ............... Rule 607. 

FINRA .......... Rules 2360(b)(20)(B) and 

2355. 

NYSE ........... N/A. 

PHLX ............ N/A. 

NYSE ARCA Rule 9.18(m). 

BX/BOX ........ Chapter XI, Section 8. 

NASDAQ ...... Chapter XI, Section 6. 

Prohibition Against Guarantees 

AMEX ........... Rule 390. 

BATS ............ Rule 26.13. 

CBOE ........... Rule 9.18. 

C2 ................. CBOE Rule 9.18. 

ISE ............... Rules 619 and 620. 

FINRA .......... Rule 2150(b). 

NYSE ........... Rule 2150(b). 

PHLX ............ Rule 777. 

NYSE ARCA Rule 9.1(e). 

BX/BOX ........ Chapter XI, Sections 20 and 

21. 

NASDAQ ...... Chapter XI, Sections 18 and 

19. 

COMMON RULES—Continued 

Sharing in Accounts 

AMEX ........... Rule 390.7

BATS ............ Rule 26.14. 

CBOE ........... Rule 9.18(b).8

C2 ................. CBOE Rule 9.18(b).8

ISE ............... Rule 620.7

FINRA .......... Rule 2150(c). 

NYSE ........... Rule 2150(c). 

PHLX ............ N/A. 

NYSE ARCA Rule 9.1(f). 

BX/BOX ........ Chapter XI, Section 21.8

NASDAQ ...... Chapter XI, Section 19.8

Registration of ROP 

AMEX ........... Rule 920. 

BATS ............ 17.2(g)(1), (2), (6) and (7). 

CBOE ........... Rule 9.2. 

C2 ................. CBOE Rule 9.2. 

ISE ............... Rule 601. 

FINRA .......... NASD Rules 1022(f) & IM– 

1022–1. 

NYSE ........... N/A. 

PHLX ............ Rule 1024(a)(i). 

NYSE ARCA Rule 9.26. 

BX/BOX ........ Chapter XI, Section 2. 

NASDAQ ...... Chapter XI, Section 2. 

Certification of Registered Personnel 

AMEX ........... Rule 920. 

BATS ............ Rule 2.5 Interpretation .01(c) 

and 11.4(e). 

CBOE ........... Rule 9.3. 

C2 ................. CBOE Rule 9.3. 

ISE ............... Rule 602. 

FINRA .......... NASD Rule 1032(d). 

NYSE ........... N/A. 

PHLX ............ Rule 1024. 

NYSE ARCA Rule 9.27(a). 

BX/BOX ........ Chapter XI, Section 3. 

NASDAQ ...... Chapter XI, Section 3. 

*Pursuant to C2 Chapters 9 and 11, the 

rules contained in CBOE Chapters IX and XI 

and referenced herein shall apply to C2. 1FINRA shall not have any Regulatory Responsibility regarding opening short uncovered 

option accounts requirements. 2FINRA shall not have any Regulatory Responsibility regarding foreign currency option 

requirements specified in any of the PHLX 

rules in this Exhibit A. 3FINRA shall not have any Regulatory Responsibility to enforce this rule as to time and 

price discretion in institutional accounts. 4FINRA shall not have any Regulatory Responsibility regarding the self regulatory organization’s (‘‘SRO’’) requirements to the extent 

that a customer would meet FINRA’s definition 

of Institutional Investor and Institutional Sales 

Material but would not meet the requirements 

for such definitions in under the SRO’s rule. In 

addition, FINRA shall not have any Regulatory 

Responsibility regarding the SRO’s requirements regarding approval of all market letters. 5FINRA shall not have any Regulatory Responsibility regarding the requirement in confirmations to distinguish between NYSE option 

transactions and other transactions in option 

contracts. 6FINRA shall only have Regulatory Responsibility for the first paragraph and shall not 

have any Regulatory Responsibility regarding 

the requirements for debt options. 

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Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 9981 

17See supra note 16 (citing to Securities 

Exchange Act Release No. 57987). 

18 15 U.S.C. 78q(d). 

19 17 CFR 200.30–3(a)(34). 

1 15 U.S.C. 78s(b)(1). 

2Securities Exchange Act Release No. 61254 (Dec. 

29, 2009), 75 FR 1093. 

3The Commission recently approved rule 

changes permitting NYSE Amex, NYSE Arca, 

International Securities Exchange, and the Chicago 

Board Options Exchange to each list and trade 

options based on the EFTS Gold Trust and EFTS 

Silver Trust shares. Securities Exchange Act Release 

Continued 

7FINRA shall not have any Regulatory Responsibility regarding the self regulatory organization’s requirements to the extent such 

rules do not contain an exception to permit 

sharing in the profits and losses of an account. 8FINRA shall not have any Regulatory Responsibility regarding the self regulatory organization’s requirements to the extent such 

rules do not contain an exception addressing 

immediate family. 

IV. Solicitation of Comments 

In order to assist the Commission in 

determining whether to approve the 

17d–2 plan, interested persons are 

invited to submit written data, views, 

and arguments concerning the 

foregoing. Comments may be submitted 

by any of the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/other.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number S7–966 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number S7–966. 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/other.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed plan that 

are filed with the Commission, and all 

written communications relating to the 

proposed plan 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 Web 

site viewing and printing in the 

Commission’s Public Reference Room, 

on official business days between the 

hours of 10 a.m. and 3 p.m. Copies of 

the plan also will be available for 

inspection and copying at the principal 

offices of BATS, CBOE, C2, ISE, FINRA, 

NYSE, Amex, Arca, NASDAQ, BX and 

the Phlx. 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 S7–966 and should be 

submitted on or before March 25, 2010. 

V. Discussion 

The Commission continues to believe 

that the proposed plan is an 

achievement in cooperation among the 

SRO participants, and will reduce 

unnecessary regulatory duplication by 

allocating to the designated SRO the 

responsibility for certain options-related 

sales practice matters that would 

otherwise be performed by multiple 

SROs. The plan promotes efficiency by 

reducing costs to firms that are members 

of more than one of the SRO 

participants. In addition, because the 

SRO participants coordinate their 

regulatory functions in accordance with 

the plan, the plan promotes, and will 

continue to promote, investor 

protection. 

Under paragraph (c) of Rule 17d–2, 

the Commission may, after appropriate 

notice and comment, declare a plan, or 

any part of a plan, effective. In this 

instance, the Commission believes that 

appropriate notice and comment can 

take place after the proposed 

amendment is effective. The primary 

purpose of the amendment is to add 

BATS Exchange, Inc. and C2 Options 

Exchange, Incorporated as SRO 

participants and to reflect the name 

changes of the American Stock 

Exchange, LLC to the NYSE Amex LLC, 

the Boston Stock Exchange, Inc. to the 

NASDAQ OMX BX, Inc., and the 

Philadelphia Stock Exchange, Inc. to the 

NASDAQ OMX PHLX, Inc. The 

Commission notes that the prior version 

of this plan immediately prior to this 

proposed amendment was published for 

comment and the Commission did not 

receive any comments thereon.17

Furthermore, the Commission does not 

believe that the amendment to the plan 

raises any new regulatory issues that the 

Commission has not previously 

considered. 

VI. Conclusion 

This order gives effect to the amended 

plan submitted to the Commission that 

is contained in File No. S7–966. 

It is therefore ordered, pursuant to 

Section 17(d) of the Act,18 that the 

amended plan dated February 5, 2010 

by and between the BATS, CBOE, C2, 

ISE, FINRA, NYSE, Amex, Arca, 

NASDAQ, BX and the Phlx filed 

pursuant to Rule 17d–2 is hereby 

approved and declared effective. 

It is further ordered that those SRO 

participants that are not the DOEA as to 

a particular common member are 

relieved of those regulatory 

responsibilities allocated to the common 

member’s DOEA under the amended 

plan to the extent of such allocation. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–4456 Filed 3–3–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61591; File No. SR–OCC– 

2009–20] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Order 

Approving Proposed Rule Change 

Relating to ETFS Physical Swiss Gold 

Shares and ETFS Physical Silver 

Shares 

February 25, 2010. 

I. Introduction 

On December 14, 2009, The Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission the proposed rule change 

pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934.1 On 

January 8, 2010, the Commission 

published notice of the proposed rule 

change in the Federal Register to solicit 

comments from interested persons.2 For 

the reasons discussed below, the 

Commission is approving the proposed 

rule change. 

II. Description 

The proposed rule change will amend 

the interpretation following the 

definition of ‘‘fund share’’ in Article I, 

Section 1, of OCC’s By-Laws. This 

amendment will enable OCC to (i) clear 

and treat as securities options any 

option contracts on ETFS Physical 

Swiss Gold Shares or on ETFS Physical 

Silver Shares that are traded on 

securities exchanges and (ii) clear and 

treat as security futures any futures 

contracts on ETFS Physical Swiss Gold 

Shares and ETFS Physical Silver 

Shares.3 In addition, in its capacity as a 

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