14842 Federal Register / Vol. 72, No. 60 / Thursday, March 29, 2007 / Notices 

8 15 U.S.C. 78o–3(b)(6). 

9 15 U.S.C. 78s(b)(3)(A)(iii). 

10 17 CFR 240.19b–4(f)(6). 

11For purposes only of waiving the 30-day preoperative period, the Commission has considered 

the proposed rule’s impact on efficiency, 

competition and capital formation. 15 U.S.C. 78c(f). 

12See supra note 7. 

13 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

begin on April 2, 2007 and end on July 

31, 2007, unless the SEC approves an 

extension of the pilot or adoption of the 

program on a permanent basis. 

2. Statutory Basis 

NASD believes that the proposed rule 

change is consistent with the provisions 

of Section 15A(b)(6) of the Act,8 which 

requires, among other things, that NASD 

rules be designed to prevent fraudulent 

and manipulative acts and practices, to 

promote just and equitable principles of 

trade, and, in general, to protect 

investors and the public interest. NASD 

believes that this technical change is 

consistent with the protection of 

investors and the public interest in that 

it will avoid any confusion when 

reading the provisions of Rule 

2520(g)(6)(B)(i). 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

NASD does not believe that the 

proposed rule change will result in 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 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing proposed rule change is 

subject to Section 19(b)(3)(A)(iii) of the 

Act 9 and Rule 19b–4(f)(6) thereunder 10

because the proposal: (i) Does not 

significantly affect the protection of 

investors or the public interest; (ii) does 

not impose any significant burden on 

competition; and (iii) does not become 

operative prior to 30 days after the date 

of filing or such shorter time as the 

Commission may designate. At any time 

within 60 days of the filing of such 

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. 

NASD has asked the Commission to 

waive the five-day pre-filing notice 

requirement and the 30-day operative 

delay. The Commission believes such 

waivers are consistent with the 

protection of investors and the public 

interest because they would allow the 

technical corrections in the proposed 

rule change to be implemented on April 

2, 2007, when the NASD portfolio 

margin pilot program begins, pursuant 

to SR–NASD–2007–013.11 For this 

reason, the Commission designates the 

proposal to be operative upon filing 

with the Commission.12

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 rulecomments@sec.gov. Please include File 

Number SR–NASD–2007–024 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NASD–2007–024. 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. Copies of such filing also will be 

available for inspection and copying at 

the principal office of NASD. 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–NASD–2007–024 and 

should be submitted on or before April 

19, 2007. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.13

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E7–5814 Filed 3–28–07; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55517; File No. SR–NYSE–

2007–06] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing of Proposed Rule Change to 

NYSE Rule 440A (‘‘Telephone 

Solicitations’’) 

March 23, 2007. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),2 and Rule 19b-4 thereunder, 

notice is hereby given that on January 

25, 2007, the New York Stock Exchange 

LLC (‘‘NYSE’’ or ‘‘Exchange’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed amendments to its Rule 440A, 

as described in Items I, II and III below, 

which items have been prepared by the 

Exchange. 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 New York Stock Exchange LLC is 

filing with the Securities and Exchange 

Commission proposed Rule 440A 

(‘‘Telephone Solicitations’’) which 

addresses member organizations’

telephone solicitations of customers. 

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 the 

proposed rule change is available on the 


jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 72, No. 60 / Thursday, March 29, 2007 / Notices 14843 

3See Exchange Act Release No. 53382 (Feb. 27, 

2006), 71 FR 11251 (Mar. 6, 2006) (SR–NYSE–2005–

77). 

4See Exchange Act Release No. 34–52579 (Oct. 7, 

2005), 70 FR 60119 (Oct. 14, 2005) (SR–NYSE–

2004–73). 

5Rules and Regulations Implementing the 

Telephone Consumer Protection Act of 1991, FCC 

03–153 (Jun. 26, 2003), 68 FR 44144 (Jul. 25, 2003). 

6 Junk Fax Prevention Act of 2005, Pub. L. 109–

21, 119 Stat. 359 (2005). 

7FCC 06–42 (Apr. 5, 2006), 71 FR 56893 (Sept. 

28, 2006). 

8An established business relationship is defined 

as a prior existing relationship formed by voluntary 

two-way communication between a member 

organization and a person where the person has, 

generally speaking, done business with the member 

organization within the 18 months preceding the 

telephone call, the member organization is the 

broker-dealer of record for the person’s account 

within those 18 months, or the person has 

contacted the member organization to inquire about 

a product or service within the three months 

preceding the telephone call. 

9The Exchange expanded this description of the 

standards and added the definition of ‘‘established 

business relationship’’ to this notice during a 

telephone conversation between William Jannace, 

Managing Director, Rule and Interpretive Standards, 

NYSE Regulation, and Elizabeth MacDonald, 

Special Counsel, Division of Market Regulation, 

Commission, March 20, 2007. 

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

NYSE’s Web site (http:// 

www.NYSE.com), at the NYSE’s 

principal office, and at the 

Commission’s Public Reference Room. 

The Exchange 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 

NYSE Rule 440A (the ‘‘Rule’’) 

addresses member organizations’

telephone solicitations of customers. 

Rule 440A(g) provides ‘‘No member or 

member organization may use a 

telephone facsimile machine, computer 

or other device to send an unsolicited 

advertisement to a telephone facsimile 

machine, computer or other device.’’

Subsection 440A(g)(1) provides that a 

facsimile advertisement is not 

‘‘unsolicited’’ where the recipient has 

granted the member organization prior 

express invitation or permission to 

deliver the advertisement, as further 

defined in the Rule. This proposed 

amendment to NYSE Rule 440A would 

provide that such an advertisement also 

will not be considered ‘‘unsolicited’’

where there is an ‘‘established business 

relationship’’ as defined in the present 

Rule 440A(j). 

In addition, changes are proposed to 

delete the term ‘‘member’’ as used in the 

Rule to reflect the recent reorganization 

of the Exchange,3 and the term ‘‘allied 

member’’ as redundant within the 

context of the present regulation. 

Background 

The amendments to Rule 440A(g) 

were adopted by the Exchange on 

December 2, 2004 4 to incorporate 

regulations issued by the Federal 

Communications Commission (‘‘FCC’’) 

and the Federal Trade Commission 

(‘‘FTC’’) relating to the implementation 

of the National Do Not Call registry and 

the amendments to the Telephone 

Consumer Protection Act of 1991.5 The 

FCC and FTC regulations contained no 

exception for facsimiles sent to 

customers with which a broker-dealer 

had an ‘‘established business 

relationship’’ as such term was defined. 

Subsequently, Congress passed 

legislation 6 which restored an 

exemption for unsolicited faxes sent to 

a recipient with whom the sender had 

an established business relationship. 

Accordingly, the proposed amendments 

to NYSE Rule 440A(g)(1) will add an 

exception for established business 

relationships to the definition of 

‘‘unsolicited’’ and will also set forth the 

measures necessary for a customer to 

opt out of the receipt of further 

communications. These standards, 

which are taken from applicable FCC 

regulations,7 generally require that the 

member organization and the person not 

only have an established business 

relationship,8 but also that the member 

organization obtain the fax number from 

the recipient (or the recipient’s web site, 

directory, or advertisement). Further, 

the recipient must not have stated on 

those materials that they do not accept 

unsolicited advertisements at the listed 

number. The member organization must 

also take reasonable steps to verify that 

the recipient consented to have the 

number listed.9

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b)(5) 10 of the Act which 

requires NYSE to have rules that are 

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, in general, to protect 

investors and the public interest. The 

proposed amendments will move the 

Rule into conformity with revised 

federal regulatory standards and ensure 

that customers are able to opt out of the 

receipt of undesired communications. 

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 

The Exchange has neither solicited 

nor received written comments on the 

proposed rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

As the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

a. By order approve the proposed rule 

change, or 

b. Institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

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 rulecomments@sec.gov. Please include File 

Number SR–NYSE–2007–06 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NYSE–2007–06. 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 


jlentini on PROD1PC65 with NOTICES
14844 Federal Register / Vol. 72, No. 60 / Thursday, March 29, 2007 / Notices 

11 17 CFR 200.30–3(a)(12). 

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

2The Commission has modified parts of these 

statements. 

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. Copies of such filing also will be 

available for inspection and copying at 

the principal office of the NYSE. 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–NYSE–2007–06 and should 

be submitted on or before April 19, 

2007. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.11

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E7–5816 Filed 3–28–07; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–55504; File No. SR–OCC–

2006–15] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing of a Proposed Rule Change 

Relating to the Approval of Fund 

Shares Deposited as Margin 

March 21, 2007. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),1 notice is hereby given that on 

August 31, 2006, The Options Clearing 

Corporation (‘‘OCC’’) 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 primarily by OCC. 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 proposed rule change would 

eliminate the requirement that the 

Membership/Risk Committee approve 

classes of fund shares (e.g., ETFs) for 

deposit as margin. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

OCC 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. OCC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of such statements.2

(A) Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

The proposed rule change would 

delete Interpretation and Policy .11 to 

Rule 604, Forms of Margin, which 

requires that OCC’s Membership/Risk 

Committee approve classes of fund 

shares for deposit as margin. Committee 

approval was deemed to be a prudent 

safeguard when OCC began accepting 

fund shares for deposit in 1996 because 

fund shares had only been trading since 

1993, and OCC was not as familiar with 

them as it is today. In 1997, OCC began 

clearing options on fund shares. Since 

then, fund shares have become a widely 

used investment tool, and OCC has 

developed a broad understanding of the 

fund share marketplace. In light of these 

developments, OCC believes that fund 

shares should be accepted as margin 

under the same conditions that apply to 

the deposit of other equity securities 

without the need for Committee 

approval. 

The proposed change is consistent 

with Section 17A of the Act because it 

eliminates an unwarranted approval 

process for the acceptance of fund 

shares as a form of margin asset while 

employing the same safeguards that 

apply to the deposit of other equity 

securities as margin in order to assure 

the safeguarding of securities which are 

in OCC’s custody or control. The 

proposed rule change is not inconsistent 

with the existing rules of OCC, 

including any other rules proposed to be 

amended. 

(B) Self-Regulatory Organization’s 

Statement on Burden on Competition 

OCC does not believe that the 

proposed rule change would impose any 

burden on competition. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were not and are 

not intended to be solicited with respect 

to the proposed rule change, and none 

have been received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) By order approve the proposed 

rule change or 

(B) Institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

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 rulecomments@sec.gov. Please include File 

Number SR–OCC–2006–15 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–OCC–2006–15. 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 


jlentini on PROD1PC65 with NOTICES