Federal Register / Vol. 75, No. 47 / Thursday, March 11, 2010 / Notices 11605 

7 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). 

8 15 U.S.C. 78f(b)(4); 15 U.S.C. 78f(b)(5); 15 U.S.C. 

78f(b)(7). 

9 15 U.S.C. 78f(b)(4). 

10 15 U.S.C. 78f(b)(5). 

11 15 U.S.C. 78f(b)(7). 

12 15 U.S.C. 78f(b)(4). 

13The first such notice will be sent to member 

organizations that are two months or more in 

arrears as of the end of February 2010. See e-mail 

from John Carey, Chief Counsel—U.S. Equities, 

NYSE Euronext LLC, to David Liu, Assistant 

Director, and Leigh W. Duffy, Attorney-Adviser, 

Division of Trading and Markets, Commission, 

dated January 25, 2010. 

14 15 U.S.C. 78f. 

15 15 U.S.C. 78s(b)(2). 

16 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

licenses in 2010 or is ineligible to 

purchase trading licenses thereafter may 

purchase trading licenses (to the extent 

there are available unsold licenses) at 

such time as it is no longer three months 

in arrears in its payments. 

III. Discussion and Commission 

Findings 

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 

exchange 7 and, in particular, the 

requirements of Sections 6(b)(4), 6(b)(5) 

and 6(b)(7) of the Act.8 Section 6(b)(4) 

of the Act 9 requires that the rules of the 

exchange provide for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members and 

issuers and other persons using its 

facilities. Section 6(b)(5) of the Act 10

requires, among other things, that the 

rules of a national securities exchange 

are not designed to permit unfair 

discrimination between customers, 

issuers, brokers or dealers. Section 

6(b)(7) of the Act 11 requires, among 

other things, that the exchange’s rules 

provide fair procedures for prohibiting 

or limiting any person with respect to 

access to services offered by the 

exchange or member thereof. 

The Commission believes that the 

proposal is consistent with Section 

6(b)(4) of the Act 12 in that it provides 

for an equitable allocation of fees among 

member organizations. The Exchange 

represents that it relies in part on the 

revenues from trading license fees to 

pay for the maintenance of the trading 

floor and to fund its trading floor 

regulatory activities. The trading license 

fees and rules limiting the number of 

trading licenses that may be initially 

applied for are the same for all member 

organizations, and member 

organizations would be denied trading 

floor privileges only if they have not 

paid the trading license fee for several 

months. The Commission notes that the 

proposal may encourage member 

organizations to pay their bills more 

promptly and thereby enable the 

Exchange to avoid imposing the cost of 

the nonpayment by a small number of 

member organizations on the majority of 

other member organizations that 

routinely pay on time. 

The Commission also believes that the 

proposal is consistent with Sections 

6(b)(5) and 6(b)(7) of the Act. The 

Commission notes that the new 

procedures specify procedures to 

provide notice to member organizations 

of a pending denial or revocation. In 

addition, member organizations receive 

monthly trading license bills that reflect 

unpaid balances from previous periods. 

The Exchange has also represented that 

it would distribute an Information 

Memorandum to its member 

organizations to inform them of the 

proposed rule change.13 Thereafter, the 

procedures provide that, one calendar 

month prior to the Expiration Date, the 

Exchange will notify each applicable 

member organization that is currently 

two months or more in arrears in paying 

monthly installments of the trading 

license fee payable in respect of any 

previously purchased trading license of 

the amount of then overdue trading 

license installment payments and the 

possibility of denial of renewal or 

revocation of the trading license on the 

Expiration Date. The notice must 

include a description of the appeal 

process. 

The Commission also notes that the 

proposal clarifies the scope of the 

Exchange’s review on appeal and sets 

forth specific time frames for scheduling 

and conducting an appeal of a pending 

denial or revocation. If the member 

organization believes the Exchange’s 

records are incorrect, the member 

organization must submit a written 

appeal within five business days of 

receipt of the Exchange’s notice, 

providing an explanation as to why it 

believes the Exchange’s records are 

incorrect, and providing copies of any 

relevant documentation. In addition, the 

Exchange must provide a final 

determination in writing in response to 

any such appeal no later than 15 

calendar days prior to the effective date 

of the potential denial of renewal or 

revocation of the applicable trading 

license. If the Exchange denies the 

appeal, its written final determination 

must specifically address the arguments 

made by the member organization in its 

submission. The written determination 

shall be final and conclusive action by 

the Exchange. In addition, the Exchange 

has required a written record of any 

proceedings. 

For these reasons, the Commission 

finds that the proposed rule change is 

consistent with the requirements of the 

Act.14

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,15 that the 

proposed rule change (SR–NYSE–2010– 

03) is hereby approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–5214 Filed 3–10–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61648; File No. SR–FINRA– 

2010–009] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Provide Additional 

Relief Relating to Certain FINRA/ 

Nasdaq Trade Reporting Facility and 

OTC Reporting Facility Fees 

March 4, 2010. 

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 March 1, 

2010, Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II 

and III below, which Items have been 

prepared by FINRA. FINRA has 

designated the proposed rule change as 

‘‘establishing or changing a due, fee or 

other charge’’ under Section 

19(b)(3)(A)(ii) of the Act 3 and Rule 19b– 

4(f)(2) thereunder,4 which renders the 

proposal effective upon receipt of this 

filing by the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 


jlentini on DSKJ8SOYB1PROD with NOTICES
11606 Federal Register / Vol. 75, No. 47 / Thursday, March 11, 2010 / Notices 

5See Securities Exchange Act Release No. 61160 

(December 14, 2009), 74 FR 67284 (December 18, 

2009) (Notice of Filing and Immediate Effectiveness 

of SR–FINRA–2009–088). 

6FINRA notes that a similar proposal to waive 

and issue a credit for certain cancel fees was the 

subject of a filing by NASDAQ OMX PHLX, Inc. See 

Securities Exchange Act Release No. 60853 (October 

21, 2009), 74 FR 55594 (October 28, 2009) (Notice 

of Filing and Immediate Effectiveness of File No. 

SR–PHLX–2009–89). 

7 15 U.S.C. 78o–3(b)(5). 

8 15 U.S.C. 78s(b)(3)(A)(ii). 

9 17 CFR 240.19b–4(f)(2). 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

FINRA is proposing to waive and 

issue a credit for fees that were charged 

to FINRA members under FINRA Rules 

7620A and 7710 for the submission of 

‘‘as/of’’ trade reports to the FINRA/ 

Nasdaq Trade Reporting Facility 

(‘‘FINRA/Nasdaq TRF’’) and the OTC 

Reporting Facility (‘‘ORF’’), respectively, 

for trades executed on eight days in the 

months of August and September 2009. 

The relief proposed herein is in addition 

to the fee relief provided under SR– 

FINRA–2009–088. The proposed rule 

change does not require amendments to 

any FINRA rules. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

FINRA 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. FINRA 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 

Pursuant to FINRA Rules 7620A and 

7710, members are charged fees for 

trade reporting to the FINRA/Nasdaq 

TRF and ORF, respectively, and the fee 

for the submission of late trade reports, 

including ‘‘as/of’’ reports, is higher than 

the fee for the submission of timely 

trade reports. ‘‘As/of’’ reports are reports 

of trades that were executed on a date 

prior to the date they were reported. 

During the months of August and 

September 2009, various Automated 

Confirmation Transaction Service 

(‘‘ACT’’) technology issues impacted 

trade reporting to the FINRA/Nasdaq 

TRF and the ORF for a period of eight 

days: August 3, August 4, August 5, 

August 17, August 21, September 16, 

September 25 and September 28. Due to 

the ACT technology issues, members 

were unable to report trades on trade 

date and thus incurred higher than 

normal reporting charges due to the 

higher number of ‘‘as/of’’ reports that 

they were compelled to submit. 

On December 7, 2009, FINRA filed 

proposed rule change SR–FINRA–2009– 

088, and on December 17, 2009, the SEC 

published notice of filing and 

immediate effectiveness of SR–FINRA– 

2009–088 in the Federal Register.5 In 

that filing, FINRA proposed to waive the 

fees for ‘‘as/of’’ trade reports submitted 

on the following days in 2009: August 

4, August 5, August 6, August 18, 

August 24, September 17, September 28 

and September 29. These dates are the 

next business day (T+1) following the 

days on which the ACT technology 

issues occurred. The relief proposed in 

SR–FINRA–2009–088 was based on the 

assumption that members that were 

unable to report on trade date due to 

ACT technology issues reported the 

trades on the following business day 

(T+1). 

Subsequent to publication of notice in 

the Federal Register, however, FINRA 

obtained additional information from 

Nasdaq, the FINRA/Nasdaq TRF 

‘‘Business Member’’ and ACT technology 

provider, and it was determined that the 

scope of the relief provided under SR– 

FINRA–2009–088 is too narrow. Some 

members that were unable to report on 

trade date did not, in fact, report on the 

following business day (T+1), but 

reported two (or perhaps more) days 

after trade date (T+2 or later). The relief 

provided under SR–FINRA–2009–088 

does not reach these members. 

Accordingly, FINRA is proposing to 

waive the fees for all ‘‘as/of’’ trade 

reports submitted on T+2 or later to the 

FINRA/Nasdaq TRF and ORF that have 

a trade execution date of August 3, 

August 4, August 5, August 17, August 

21, September 16, September 25 and 

September 28, 2009 (i.e., the dates on 

which the ACT technology issues 

occurred). The proposed relief will 

apply to fees for ‘‘as/of’’ trade reports 

submitted through December 31, 2009. 

Members will be issued a credit for the 

fees on a future invoice.6

The proposed relief is in addition to 

the relief provided in SR–FINRA–2009– 

088 for fees charged on ‘‘as/of’’ trade 

reports submitted on T+1. FINRA 

believes that such additional relief is 

appropriate in order to make all 

members whole, since the higher 

charges were the result of an ACT 

technology issue and not the fault of the 

member. 

FINRA has filed the proposed rule 

change for immediate effectiveness. The 

operative date will be the date of filing. 

2. Statutory Basis 

FINRA believes that the proposed rule 

change is consistent with the provisions 

of Section 15A(b)(5) of the Act,7 which 

requires, among other things, that 

FINRA rules provide for the equitable 

allocation of reasonable dues, fees and 

other charges among members and 

issuers and other persons using any 

facility or system that FINRA operates 

or controls. FINRA believes that the 

proposed waiver and credit of the ‘‘as/ 

of’’ reporting fees is fair and equitable in 

that it will apply uniformly to all FINRA 

members that submitted ‘‘as/of’’ trade 

reports to the FINRA/Nasdaq TRF and 

ORF for trades with the designated trade 

dates. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA does not believe that the 

proposed rule change will impose any 

burden on competition 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 either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act 8 and paragraph 

(f)(2) of Rule 19b–4 thereunder.9 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: 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 75, No. 47 / Thursday, March 11, 2010 / Notices 11607 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Exchange Act Release No. 60526 (August 18, 

2009) (NYSEAmex–2009–19) 74 FR 43185 (August 

26, 2009). 

4 15 U.S.C. 78f(b). 

5 15 U.S.C. 78f(b)(5). 

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 SR–FINRA–2010–009 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–FINRA–2010–009. 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 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 such filing 

also will be available for inspection and 

copying at the principal office of 

FINRA. 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 publicly available. All 

submissions should refer to File 

Number SR–FINRA–2010–009 and 

should be submitted on or before April 

1, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–5217 Filed 3–10–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61643; File No. SR– 

NYSEAmex–2010–16] 

Self-Regulatory Organizations; NYSE 

Amex LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Deleting Rules 993NY 

and 945 

March 3, 2010. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that, on February 

24, 2010, NYSE Amex LLC (‘‘NYSE 

Amex’’ or the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to delete 

Rules 993NY and 945, which governed 

processing of orders received through 

the OCC Hub. The text of the proposed 

rule change is available on NYSE 

Amex’s Web site at http:// 

www.nyse.com, on the Commission’s 

Web site at http://www.sec.gov, at NYSE 

Amex, and at the Commission’s Public 

Reference Room. 

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 

self-regulatory organization 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 this filing is to delete 

outdated rules related to the receipt, 

execution, and reporting of Principal 

(‘‘P’’) and Principal Acting as Agent (‘‘P/ 

A’’) entered to the Exchange through the 

order routing hub developed by the 

Options Clearing Corporation (‘‘OCC 

Hub’’). The affected Rules are NYSE 

Amex Rule 993NY—Temporary Rule 

Governing P and P/A orders, and Rule 

945 Liability for the Options Intermarket 

Linkage. 

At the time of approval of the Options 

Order Protection and Locked/Crossed 

Market Plan (‘‘New Plan’’) and the 

simultaneous withdrawal of the 

Exchange from the Plan for the Purpose 

of Creating and Operating an 

Intermarket Options Linkage (‘‘Old 

Plan’’), the Exchange also filed and 

received approval for rules 

implementing the New Plan.3 Certain 

Participants to the New Plan did not 

have technology in place to take full 

advantage of the New Plan, and 

remained dependent on the OCC Hub to 

route orders to markets at the NBBO. 

The Exchange was aware that such 

dependence might occur, and included 

a Temporary Rule Governing P and P/ 

A Orders as part of the implementing 

rules for the New Plan. 

Additionally, because the OCC Hub 

remained connected to the Exchange, 

Rule 945, Liability for the Options 

Intermarket Linkage, was not eliminated 

with the other rules related to the Old 

Plan. 

All of the Participant Exchanges have 

now migrated off the OCC Hub; 

consequently the rules related to the 

OCC Hub and the Old Plan are no longer 

necessary. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with Section 

6(b) 4 of the Securities Exchange Act of 

1934 (the ‘‘Act’’), in general, and furthers 

the objectives of Section 6(b)(5) 5 in 

particular in that it is designed to 

promote just and equitable principles of 

trade, to prevent fraudulent and 

manipulative acts, to remove 

impediments to and to perfect the 

mechanism for a free and open market 

and a national market system and, in 

general, to protect investors and the 

public interest, as the rules are now 

obsolete and should be removed from 

the rule set. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 


jlentini on DSKJ8SOYB1PROD with NOTICES