Document ID: SEC-2007-0858-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc.
Posted Date: 2007-06-22T04:00Z

[Federal Register: June 22, 2007 (Volume 72, Number 120)]
[Notices]               
[Page 34499-34500]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22jn07-95]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55916; File No. SR-NASD-2007-037]

 
Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Amend NASD Rules To Extend the Closing Time of the NASD/
NYSE Trade Reporting Facility to 8 p.m.

June 15, 2007.
    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 June 12, 2007, the National Association of Securities Dealers, Inc. 
(``NASD'') 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 substantially by NASD. 
NASD filed the proposed rule change pursuant to Section 19(b)(3)(A) of 
the Act \3\ and Rule 19b-4(f)(6) thereunder,\4\ which renders it 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASD is proposing to amend Rules 4632E and 6130E relating to the 
NASD/NYSE Trade Reporting Facility (the ``NASD/NYSE TRF'') to change 
the system closing time from 6:30 p.m. to 8 p.m. (Eastern Time), which 
conforms with the system closing time of the NASD/Nasdaq Trade 
Reporting Facility (the ``NASD/Nasdaq TRF''). In addition, NASD is 
proposing certain technical, conforming changes to Rule 4632E and Rules 
4632 and 6130 relating to the NASD/Nasdaq TRF. The text of the proposed 
rule change is available at http://www.nasd.com, NASD, and 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, NASD 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. NASD 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
Extension of Operating Hours of NASD/NYSE TRF
    The NASD/Nasdaq TRF and NASD/NYSE TRF provide NASD members with 
mechanisms for reporting locked-in transactions in exchange-listed 
securities effected otherwise than on an exchange. Currently, the NASD/
NYSE TRF trade reporting rules reflect a system closing time of 6:30 
p.m. (Eastern Time), which until recently was the system closing time 
of the NASD/Nasdaq TRF and UTP Securities Information Processor 
(``SIP''). Effective September 18, 2006, the UTP SIP system closing 
time was extended from 6:30 p.m. to 8 p.m. (Eastern Time) and, to 
accommodate the extended UTP SIP system closing time, the closing time 
of the NASD/Nasdaq TRF subsequently was extended from 6:30 p.m. to 8 
p.m. (Eastern Time).\5\
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    \5\ See Securities Exchange Act Release No. 54773 (November 17, 
2006), 71 FR 68665 (November 27, 2006) (SR-NASD-2006-120).
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    NASD is proposing to extend the system hours of the NASD/NYSE TRF 
from 6:30 p.m. to 8 p.m. (Eastern Time). Specifically, NASD is 
proposing to amend Rules 4632E(a) and (g) and 6130E(f) to reflect a 
system closing time of 8 p.m. (Eastern Time). In addition, on the 
Regulation NMS Pilot Stocks Phase Date, amendments will become 
effective pursuant to SR-NASD-2007-014 which will, among other things, 
adopt new paragraph (a)(5)(H) of Rule 4632E.\6\ NASD also is proposing 
to amend that provision to reflect a system closing time of 8 p.m. The 
proposed rule change will allow market participants to timely report 
more trades taking place after normal market hours to the NASD/NYSE 
TRF, as they can do today to the NASD/Nasdaq TRF.
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    \6\ See Securities Exchange Act Release No. 55346 (February 26, 
2007), 72 FR 9807 (March 5, 2007) (SR-NASD-2007-014).
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Technical, Non-Substantive Rule Changes
    NASD is proposing a technical, non-substantive change to Rule 
6130(g) to clarify that the system closing time for the NASD/Nasdaq TRF 
and OTC Reporting Facility is 8 p.m., not 6:30 p.m. (Eastern Time). 
Rule 6130(g) became effective after SR-NASD-2006-120 was filed and thus 
was not included in the proposed rule change to extend the system 
closing time from 6:30 to 8 p.m. (Eastern Time).
    Additionally, NASD is proposing technical, non-substantive changes 
to Rule 4632(a)(2)(B) and (D) relating to the NASD/Nasdaq TRF and Rule 
4632E(a)(2)(B) and (D) relating to the NASD/NYSE TRF for the sake of 
internal consistency and to conform to the rules relating to the other 
NASD Trade Reporting Facilities (see Rule 4632C(a)(2)(B) and (D) and 
Rule 4632D(a)(2)(B) and (D)). Specifically, the technical changes will 
clarify that reports submitted on an ``as/of'' basis pursuant to these 
provisions should be reported the following business day (T+1).
    NASD is filing the proposed rule change for immediate 
effectiveness. The proposed rule change will not become operative prior 
to the 30th day after the date of filing. NASD will announce the 
operative date on its Web site.
2. Statutory Basis
    NASD believes that the proposed rule change is consistent with the 
provisions of Section 15A(b)(6) of the Act,\7\ 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, by affording market participants 
additional time to report trades taking place after normal market 
hours, the proposed rule change will

[[Page 34500]]

result in more timely and accurate trade reporting and thus greater 
transparency.
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    \7\ 15 U.S.C. 78o-3(b)(6).
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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

    Because the foregoing proposed rule change does not:
    (i) Significantly affect the protection of investors or the public 
interest;
    (ii) Impose any significant burden on competition; and
    (iii) Become operative for 30 days from the date on which it was 
filed, or such shorter time as the Commission may designate, it has 
become effective pursuant to Section 19(b)(3)(A) of the Act \8\ and 
Rule 19b-4(f)(6) 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.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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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 rule-comments@sec.gov. Please include 

File Number SR-NASD-2007-037 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-2007-037. 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-2007-037 and should be submitted on or before July 13, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
Florence E. Harmon,
Deputy Secretary.
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    \10\ 17 CFR 200.30-3(a)(12).
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 [FR Doc. E7-12092 Filed 6-21-07; 8:45 am]

BILLING CODE 8010-01-P