Federal Register / Vol. 75, No. 187 / Tuesday, September 28, 2010 / Notices 59771 

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

2 17 CFR 240.19b–4. 

3Securities Exchange Act Release No. 62664 

(Aug. 9, 2010), 75 FR 49542 (Aug. 13, 2010) (SR– 

FINRA–2010–037). 

4The exception for ‘‘actively traded’’ securities in 

Rule 101 of Regulation M applies to securities with 

an ADTV value, as defined in Rule 100 of 

Regulation M, of at least $1 million and are issued 

by an issuer whose common equity securities have 

a public float value of at least $150 million, 

provided, however, that such securities are not 

issued by the distribution participant or an affiliate 

of the distribution participant. 17 CFR 

242.101(c)(1). 

5 In approving this proposal, the Commission has 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

6 15 U.S.C. 78o–3(b)(6). 

7 15 U.S.C. 78s(b)(2). 

Period beginning: 

Projected peak 5 second MPS Projected peak total daily 

transactions 

UTP Quote UTP Trade UTP Quote UTP Trade 

Approved By: llllllllllll

Date Submitted: lllllllllll

[FR Doc. 2010–24225 Filed 9–27–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62970; File No. SR–FINRA– 

2010–037] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Order Approving the 

Proposed Rule Change To Amend 

FINRA Rule 5190 (Notification 

Requirements for Offering 

Participants) 

September 22, 2010. 

I. Introduction 

On July 27, 2010, the Financial 

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’) (f/k/a National Association of 

Securities Dealers, Inc. (‘‘NASD’’)) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

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

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposal to amend 

FINRA Rule 5190 (Notification 

Requirements for Offering Participants) 

relating to the notice requirements 

applicable to distributions of ‘‘actively 

traded’’ securities, as defined under 

Regulation M. This proposal was 

published for comment in the Federal 

Register on August 13, 2010.3 The 

Commission received no comments 

regarding the proposal. This order 

approves this proposed rule change. 

II. Description of the Proposed Rule 

Change 

FINRA Rule 5190 imposes certain 

notice requirements on FINRA members 

participating in distributions of listed 

and unlisted securities and is designed 

to ensure that FINRA receives pertinent 

distribution-related information from its 

members in a timely fashion to facilitate 

its Regulation M surveillance program. 

Rule 5190(d) sets forth the notice 

requirements applicable to distributions 

of securities that are considered 

‘‘actively traded’’ and thus are not 

subject to a restricted period under Rule 

101 of Regulation M.4 In connection 

with such distributions, pursuant to 

Rule 5190(d)(1), FINRA members are 

required to provide written notice to 

FINRA of the member’s determination 

that no restricted period applies and the 

basis for such determination. FINRA 

members must provide such notice at 

least one business day prior to the 

pricing of the distribution, unless later 

notification is necessary under specific 

circumstances. Rule 5190(d)(2) requires 

that, upon pricing a distribution of an 

‘‘actively traded’’ security, FINRA 

members provide written notice to 

FINRA along with pricing-related 

information such as the offering price, 

the last sale before the distribution, and 

the pricing basis. Notice of pricing must 

be provided no later than the close of 

business the next business day 

following the pricing of the distribution, 

unless later notification is necessary 

under specific circumstances. 

FINRA proposed to amend Rule 

5190(d) to require that notice under 

subparagraphs (1) and (2) be provided at 

the same time, specifically no later than 

the close of business the next business 

day following the pricing of the 

distribution. While the timing of notice 

under subparagraph (1) would change, 

the information required would not 

change. Thus, pursuant to the proposed 

rule change, FINRA members will be 

required to provide a single notice after 

pricing of the distribution and will be 

required to provide all of the same 

information that they provide today. 

FINRA has determined that it will be 

sufficient for members to provide notice 

of their determination that no restricted 

period applies following the pricing of 

the distribution. FINRA clarified that 

the proposed rule change will not 

impact FINRA’s Regulation M 

surveillance program. 

In its filing, FINRA stated that a 

significant number of distributions of 

‘‘actively traded’’ securities evolve 

quickly after the market close and are 

priced overnight before the next trading 

session. Thus, FINRA believes that its 

members frequently do not have 

sufficient advance knowledge of their 

participation in the distribution to 

provide notice to FINRA at least one 

business day prior to pricing and in 

such instances are unable to comply 

with the express terms of Rule 

5190(d)(1). FINRA then must make a 

determination whether later notification 

was necessary under the circumstances, 

in accordance with the rule. FINRA has 

stated that the proposed rule change 

will clarify members’ notice obligations 

in the context of such distributions. 

FINRA represented that the proposed 

rule change will be effective on the date 

of Commission approval. 

III. Discussion and Findings 

After careful review, the Commission 

finds that the proposed rule change is 

consistent with the requirements of the 

Act, and the rules and regulations 

thereunder that are applicable to a 

national securities association.5 In 

particular, the Commission believes that 

the proposed rule change is consistent 

with the provisions of Section 15A(b)(6) 

of the Act,6 which requires, among other 

things, that FINRA 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. The proposed rule 

change will streamline FINRA member 

obligations and continue FINRA’s 

surveillance program regarding 

Regulation M to protect investors. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,7 that the 

proposed rule change (File No. SR– 

FINRA–2010–037) be, and hereby is, 

approved. 


srobinson on DSKHWCL6B1PROD with NOTICES
59772 Federal Register / Vol. 75, No. 187 / Tuesday, September 28, 2010 / Notices 

8 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 62479 

(July 9, 2010), 75 FR 41264 (July 15, 2010) (order 

approving SR–NYSEAmex–2010–31 and the 

adoption of the NYSE Amex Equities Rule 500 

Series). The pilot program is scheduled to run until 

September 30, 2010, the expiration date of the New 

York Stock Exchange LLC’s (‘‘NYSE’’) and the 

Exchange’s New Market Model (‘‘NMM’’) pilot 

program, on which the Nasdaq Securities program 

relies. See Securities Exchange Act Release Nos. 

61274 (March 17, 2010), 75 FR 14221 (March 24, 

2010)(SR–NYSE–2010–25) and 61275 (March 17, 

2010), 75 FR 14223 (March 24, 2010)(SR– 

NYSEAmex–2010–28) (extending operation of the 

NMM pilot program on NYSE and NYSE Amex 

until the earlier of the Commission’s approval to 

make the program permanent or September 30, 

2010). For more information on the NMM pilot 

program, see Securities Exchange Act Release 

No.58845 (October 24, 2008), 73 FR 64379 (October 

29, 2008)(SR–NYSE–2008–46). 

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

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

6 15 U.S.C. 78s(b)(3)(A)(iii). 

7 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change, along with a brief 

description and text of the proposed rule change, 

at least five business days prior to the date of filing 

of the proposed rule change, or such shorter time 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–24227 Filed 9–27–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62971; File No. SR– 

NYSEAmex–2010–95] 

Self-Regulatory Organizations; NYSE 

Amex LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Clarify the 

Requirement for Floor Official 

Approval for Certain Halts of Nasdaq 

Securities Traded via UTP 

September 22, 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 

September 16, 2010, NYSE Amex LLC 

(the ‘‘Exchange’’ or ‘‘NYSE Amex’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been 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 amend 

Rule 515—NYSE Amex Equities. The 

text of the proposed rule change is 

available at the Exchange’s principal 

office, the Commission’s Public 

Reference Room, the Commission’s Web 

site (http://www.sec.gov), and http:// 

www.nyse.com. 

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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to amend Rule 515—NYSE 

Amex Equities. 

a. Background 

On July 9, 2010, the Exchange 

received approval from the Commission 

to begin trading, as a pilot program, 

securities listed on the Nasdaq Stock 

Market pursuant to unlisted trading 

privileges (‘‘Nasdaq Securities’’). The 

Nasdaq Securities program commenced 

on July 13, 2010.3

b. Proposed Amendments to Rule 515— 

NYSE Amex Equities 

The Exchange proposes to amend 

Rule 515—NYSE Amex Equities dealing 

with trading halts. In its filing adopting 

the Nasdaq Securities program, the 

Exchange included a provision in Rule 

515(a)(1)—NYSE Amex Equities that 

DMM Units did not need to obtain Floor 

Official approval in order to halt trading 

in a Nasdaq Security pursuant to Rule 

123D—NYSE Amex Equities. Upon 

further review of the operation of this 

provision and the Nasdaq Securities 

program, the Exchange believes it 

should revise this provision to clarify 

that the DMM does not need to obtain 

Floor Official approval if a Nasdaq 

Security is halted, suspended, or paused 

pursuant to section (a)(2)–(4) of the 

Rule. Accordingly, if a Nasdaq Security 

is halted, suspended or paused from 

trading by the UTP Listing Market for 

regulatory purposes in accordance with 

its rules and/or the UTP Plan, or if the 

authority to trade the Nasdaq Security 

on the Exchange is revoked, Floor 

Official approval to halt trading on the 

Exchange is not required. However, if 

the Exchange halts trading of a Nasdaq 

Security pursuant to Rule 123D—NYSE 

Amex Equities for non-regulatory 

purposes, such as an imbalance halt or 

an equipment changeover halt, the 

DMM must obtain prior Floor Official 

approval as provided for in that rule. 

The proposed provision would be 

consistent with the manner by which 

Rule 123D—NYSE Amex Equities 

operates for listed securities when a 

non-regulatory halt is invoked on the 

Exchange. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,4 in general, and 

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

of the Act,5 in particular, in that it is 

designed to prevent fraudulent and 

manipulative acts and practices, to 

promote just and equitable principles of 

trade, to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. 

The Exchange believes that the 

proposed rule change supports the 

objectives of the Act by harmonizing the 

procedures for implementing nonregulatory trading halts under Rule 

123D—NYSE Amex Equities for both its 

listed securities and Nasdaq Securities. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The Exchange has filed the proposed 

rule change pursuant to Section 

19(b)(3)(A)(iii) of the Act 6 and Rule 

19b–4(f)(6) thereunder.7 Because the 


srobinson on DSKHWCL6B1PROD with NOTICES