11792 Federal Register / Vol. 74, No. 52 / Thursday, March 19, 2009 / Notices 

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

2 17 CFR 240.19b–4. 

3The current FINRA rulebook consists of (1) 

FINRA Rules; (2) NASD Rules; and (3) rules 

incorporated from NYSE (‘‘Incorporated NYSE 

Rules’’) (together, the NASD Rules and Incorporated 

NYSE Rules are referred to as the ‘‘Transitional 

Rulebook’’). While the NASD Rules generally apply 

to all FINRA members, the Incorporated NYSE 

Rules apply only to those members of FINRA that 

are also members of the NYSE (‘‘Dual Members’’). 

The FINRA Rules apply to all FINRA members, 

unless such rules have a more limited application 

by their terms. For more information about the 

rulebook consolidation process, see FINRA 

Information Notice, March 12, 2008 (Rulebook 

Consolidation Process). 4 15 U.S.C. 78o–3(b)(6). 

(v) an asset-backed security issued or 

guaranteed by Fannie Mae, Freddie Mac 

or Ginnie Mae; or 

(2) the reference index is an index in 

which 80 percent or more of the index’s 

weighting is comprised of the entities or 

securities described in subparagraph (1). 

By the Commission. 

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–5927 Filed 3–18–09; 8:45 am] 

BILLING CODE 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59563; File No. SR–FINRA– 

2009–009] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing of 

Proposed Rule Change To Adopt 

FINRA Rule 1122 (Filing of Misleading 

Information as to Membership or 

Registration) in the Consolidated 

FINRA Rulebook 

March 12, 2009. 

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 3, 

2009, Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) (f/k/a 

National Association of Securities 

Dealers, Inc. (‘‘NASD’’)) 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. 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 

FINRA is proposing to adopt NASD 

Interpretative Material 1000–1 (‘‘IM– 

1000–1’’) (Filing of Misleading 

Information as to Membership or 

Registration) as a FINRA rule in the 

consolidated FINRA rulebook with 

minor changes. The proposed rule 

change would renumber NASD IM– 

1000–1 as FINRA Rule 1122 in the 

consolidated FINRA rulebook. 

The text of the proposed rule change 

is available on FINRA’s Web site at 

http://www.finra.org, at the principal 

office of FINRA 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, 

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 

As part of the process of developing 

a new consolidated rulebook 

(‘‘Consolidated FINRA Rulebook’’),3

FINRA is proposing to adopt NASD 

Interpretative Material 1000–1 (‘‘IM– 

1000–1’’) (Filing of Misleading 

Information as to Membership or 

Registration) as a FINRA rule in the 

consolidated FINRA rulebook with 

minor changes discussed below. 

NASD IM–1000–1 provides that the 

filing of membership or registration 

information as a Registered 

Representative with FINRA which is 

incomplete or inaccurate so as to be 

misleading, or which could in any way 

tend to mislead, or the failure to correct 

such filing after notice thereof, may be 

deemed conduct inconsistent with just 

and equitable principles of trade and 

may be subject to disciplinary action. 

FINRA proposes to adopt NASD IM– 

1000–1 as FINRA Rule 1122 as it 

believes that this rule continues to be an 

important tool in ensuring that members 

and persons associated with members 

provide complete and accurate 

membership and registration 

information. FINRA proposes to clarify 

its applicability to members and persons 

associated with members by specifying 

that ‘‘no member or person associated 

with a member’’ shall file incomplete or 

misleading membership or registration 

information. FINRA also proposes to 

eliminate the reference to the filing of 

registration information ‘‘as a Registered 

Representative’’ to clarify that the rule 

applies to the filing of registration 

information regarding any category of 

registration. In addition, FINRA 

proposes to delete the reference that the 

prohibited conduct may be deemed 

inconsistent with just and equitable 

principles of trade and subject to 

disciplinary action as unnecessary and 

to better reflect the proposed adoption 

of the NASD IM as a stand-alone FINRA 

rule. 

FINRA will announce the 

implementation date of the proposed 

rule change in a Regulatory Notice to be 

published no later than 90 days 

following Commission approval. 

2. Statutory Basis 

FINRA believes that the proposed rule 

change is consistent with the provisions 

of Section 15A(b)(6) of the Act,4 which 

requires, among other things, that 

FINRA rules must 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. FINRA believes that the 

proposed rule change helps to ensure 

the accuracy and completeness of 

membership and registration 

information filed with FINRA. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA 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 

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 such proposed 

rule change, or 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 74, No. 52 / Thursday, March 19, 2009 / Notices 11793 

5 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3For purposes of this proposal, the Exchange 

defines a ‘‘dividend strategy’’ as transactions done 

to achieve a dividend arbitrage involving the 

purchase, sale and exercise of in-the-money options 

of the same class, executed prior to the date on 

which the underlying stock goes ex-dividend. See 

e.g., Securities Exchange Act Release No. 54174 

(July 19, 2006), 71 FR 42156 (July 25, 2006) (SR– 

Phlx–2006–40). 

4For purposes of this proposal, the Exchange 

defines a ‘‘merger strategy’’ as transactions done to 

achieve a merger arbitrage involving the purchase, 

sale and exercise of options of the same class and 

expiration date, executed prior to the date on which 

shareholders of record are required to elect their 

respective form of consideration, i.e., cash or stock. 

Id. 

5For purposes of this proposal, the Exchange 

defines a ‘‘short stock interest strategy’’ as 

transactions done to achieve a short stock interest 

arbitrage involving the purchase, sale and exercise 

of in-the-money options of the same class. Id. 

6The current fee caps are in effect as a pilot 

program that is scheduled to expire on March 1, 

2009. See Securities Exchange Act Release No. 

57420 (March 3, 2008), 73 FR 12790 (March 10, 

2008) (SR–Phlx–2008–16). 

7See Securities Exchange Act Release Nos. 59243 

(January 13, 2009), 74 FR 4272, (January 23, 2009) 

(SR–Phlx–2008–86) (eliminating the comparison 

charge); 58772 (October 10, 2008), 73 FR 63037 

(October 22, 2008) (SR–Phlx–2008–72) (eliminating 

reference to the $ 0.05 per contract side license fee 

for dividend strategies and short stock interest 

strategies). 

(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–FINRA–2009–009 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–2009–009. 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 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 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 available publicly. All 

submissions should refer to File 

Number SR–FINRA–2009–009 and 

should be submitted on or before April 

9, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.5

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–5929 Filed 3–18–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59566; File No. SR–Phlx– 

2009–18] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX, Inc.; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to Fee 

Caps on Equity Option Transaction 

Charges on Dividend, Merger and 

Short Stock Interest Strategies 

March 12, 2009. 

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 February 

24, 2009, NASDAQ OMX PHLX, Inc. 

(‘‘Phlx’’ or ‘‘Exchange’’) 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 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 Exchange proposes to make 

permanent the pilot program for the 

$1,000 and $25,000 fee caps on equity 

option transaction charges on 

dividend,3 merger,4 and short stock 

interest 5 strategies (‘‘Pilot’’) 6. This Pilot 

previously included $1,000 and $25,000 

fee caps on transaction and comparison 

charges on dividend, merger and short 

stock interest strategies as well as a 

license fee of $0.05 per contract side 

imposed on dividend and short stock 

interest strategies. The comparison 

charges as well as a license fee of $0.05 

per contract side were subsequently 

eliminated.7 Other than requesting to 

make the Pilot permanent, no other 

changes to the Exchange’s current 

dividend, merger and short stock 

interest strategy program are being 

proposed at this time. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.nasdaqtrader.com/ 

micro.aspx?id=PHLXRulefilings, at the 

principal office of the Exchange, 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 

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 these 

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 aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Currently, the Exchange imposes a fee 

cap on equity option transaction charges 

on dividend, merger and short stock 

interest strategies executed on the same 

trading day in the same options class. 

Specifically, Registered Options Trader 

(‘‘ROT’’) and specialist net equity option 


sroberts on PROD1PC70 with NOTICES