Document ID: SEC-2009-0079-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Alternext US LLC
Posted Date: 2009-01-16T05:00Z

[Federal Register: January 16, 2009 (Volume 74, Number 11)]
[Notices]               
[Page 3123-3125]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr16ja09-147]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59233; File No. SR-NYSEALTR-2008-21]

 
Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NYSE Alternext US LLC Amending 
NYSE Alternext Equities Rule 103B To Conform to Amendments Filed by the 
New York Stock Exchange To: (1) Prohibit DMM Units From Communicating 
With Issuers After Receipt of Notice From the Exchange of the Issuer's 
Impending Listing; and (2) Provide DMM Unit Marketing Materials to the 
Issuer Prior to the Scheduled Interview Rather Than the Day Before

January 12, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on December 31, 2008, NYSE Alternext US LLC (the 
``Exchange'' or ``NYSE Alternext'') 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 self-regulatory organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend NYSE Alternext Equities Rule 103B 
(``Security Allocation and Reallocation'') to conform to amendments 
filed by the New York Stock Exchange to: (1) Prohibit DMM units from 
communicating with issuers after receipt of notice from the Exchange of 
the issuer's impending listing; and (2) provide DMM unit marketing 
materials to the issuer prior to the scheduled interview rather than 
the day before.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://www.nyse.com, at the Exchange's principal office, 
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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend NYSE Alternext Equities Rule 103B 
(``Security Allocation and Reallocation'') to conform with amendments 
filed by the New York Stock Exchange \4\ to: (1) Prohibit DMM units 
from communicating with issuers after receipt of notice from the 
Exchange of the issuer's impending listing; and (2) provide DMM unit 
marketing materials to the issuer prior to the scheduled interview 
rather than the day before.
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    \4\ See Securities Exchange Act Release No. 59231 (January 12, 
2009) (SR-NYSE-2008-143).
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I. Background
    As described more fully in a related rule filing,\5\ NYSE Euronext 
acquired The Amex Membership Corporation (``AMC'') pursuant to an 
Agreement and Plan of Merger, dated January 17, 2008 (the ``Merger''). 
In connection with the Merger, the Exchange's predecessor, the American 
Stock Exchange LLC (``Amex''), a subsidiary of AMC, became a subsidiary 
of NYSE Euronext called NYSE Alternext US LLC, and continues to operate 
as a national securities exchange registered under Section 6 of the 
Securities Exchange Act of 1934, as amended (the ``Act'').\6\ The 
effective date of the Merger was October 1, 2008.
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    \5\ See Securities Exchange Act Release No. 58673 (September 29, 
2008), 73 FR 57707 (October 3, 2008) (SR-NYSE-2008-60 and SR-Amex 
2008-62) (approving the Merger).
    \6\ 15 U.S.C. 78f.
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    In connection with the Merger, on December 1, 2008, the Exchange 
relocated all equities trading conducted on the Exchange legacy trading 
systems and facilities located at 86 Trinity Place, New York, New York, 
to trading systems and facilities located at 11 Wall Street, New York, 
New York (the ``Equities Relocation''). The Exchange's equity trading 
systems and facilities at 11 Wall Street (the ``NYSE Alternext Trading 
Systems'') are operated by the NYSE on behalf of the Exchange.\7\
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    \7\ See Securities Exchange Act Release No. 58705 (October 1, 
2008), 73 FR 58995 (October 8, 2008) (SR-Amex 2008-63) (approving 
the Equities Relocation).
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    As part of the Equities Relocation, NYSE Alternext adopted NYSE 
Rules 1-1004, subject to such changes as necessary to apply the Rules 
to the Exchange, as the NYSE Alternext Equities Rules to govern trading 
on the NYSE Alternext Trading Systems.\8\ The NYSE Alternext Equities 
Rules, which became operative on December 1, 2008, are substantially 
identical to the current NYSE Rules 1-1004 and the Exchange continues 
to update the NYSE Alternext Equities Rules as necessary to conform 
with rule changes to corresponding NYSE Rules filed by the NYSE.
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    \8\ See Securities Exchange Act Release No. 58705 (October 1, 
2008), 73 FR 58995 (October 8, 2008) (SR-Amex 2008-63) (approving 
the Equities Relocation); Securities Exchange Act Release No. 58833 
(October 22, 2008), 73 FR 64642 (October 30, 2008) (SR-NYSE-2008-
106) and Securities Exchange Act Release No. 58839 (October 23, 
2008), 73 FR 64645 (October 30, 2008) (SR-NYSEALTR-2008-03) 
(together, approving the Bonds Relocation); Securities Exchange Act 
Release No. 59022 (November 26, 2008), 73 FR 73683 (December 3, 
2008) (SR-NYSEALTR-2008-10) (adopting amendments to NYSE Alternext 
Equities Rules to track changes to corresponding NYSE Rules); 
Securities Exchange Act Release No. 59027 (November 28, 2008), 73 FR 
73681 (December 3, 2008) (SR-NYSEALTR-2008-11) (adopting amendments 
to Rule 62--NYSE Alternext Equities to track changes to 
corresponding NYSE Rule 62).
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II. Proposed Amendments
    The Exchange proposes to amend Section III (A) of NYSE Alternext 
Equities Rule 103B to prohibit DMM units from having contact with an 
issuer after the Exchange provides notice to DMM units about the 
issuer's impending listing on the Exchange.

[[Page 3124]]

    Currently NYSE Alternext Equities Rule 103B prohibits communication 
between DMM units and issuers following their interview. The Exchange 
believes that prohibiting communication between DMM units and issuers 
just prior to the interview is appropriate in order to promote fairness 
and objectivity in the interview process. The Exchange therefore 
proposes to amend NYSE Alternext Equities Rule 103B, Section III to add 
a section prohibiting DMM units, or any individuals acting on their 
behalf, from having any contact with any listing company once the 
Exchange provides written notice to the DMM units that the listing 
company is listing on the Exchange.
    In addition to the above modification related to the interview 
process, the Exchange further seeks to allow more flexibility in the 
delivery of DMM marketing materials to an issuer based on the 
availability of the issuer. Currently, the rule provides that DMM 
marketing materials are to be provided the day before the interview. 
The Exchange proposes to amend the language to allow for the marketing 
materials to be provided prior to the interview. Some issuers that 
interview at the Exchange may be in transit the day prior to the 
interview or participating in road shows and business trips and are 
therefore unavailable to receive the materials the day before the 
scheduled interview. In those instances the Exchange provides the 
issuer with the materials the day of the interview. In instances where 
an issuer is available to receive the marketing materials in advance of 
the scheduled interview the Exchange would like to be able to provide 
the materials to the issuer. Accordingly, the Exchange proposes to 
amend the rule to simply state that the Exchange will provide the 
issuer with the DMM units' marketing materials prior to the interview.
    The Exchange proposes these amendments to conform the allocation 
process of NYSE Alternext to the allocation process of its affiliated 
Exchange, the New York Stock Exchange LLC.
2. Statutory Basis
    The basis under the Act for the proposed rule change is the 
requirement under Section 6(b)(5),\9\ which requires that an exchange 
have rules that are designed to foster cooperation and coordination 
with persons engaged in regulating, clearing, settling, processing 
information with respect to, and facilitating transactions in 
securities, 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 amendments are consistent with these objectives. The 
amendments sought herein seek to alleviate impediments in the 
administrative process of assigning securities to DMM units which 
ultimately facilitates the fair and orderly trading in the subject 
security.
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    \9\ 15 U.S.C. 78f(b)(5).
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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

    Because the proposed rule change: (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 for 30 days after the date of the filing, or such shorter 
time as the Commission may designate if consistent with the protection 
of investors and the public interest, the proposed rule change has 
become effective pursuant to Section 19(b)(3)(A) of the Act \10\ and 
Rule 19b-4(f)(6) thereunder.\11\
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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6). Pursuant to Rule 19b-4(f)(6)(iii) 
under the Act, the Exchange is required 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 as designated by the Commission. 
The Exchange has satisfied this requirement.
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    The Exchange has requested that the Commission waive the 30-day 
operative delay in this case. The Commission believes that waiving the 
30-day operative delay is consistent with the protection of investors 
and the public interest because it will immediately establish the 
specific point in time when DMM units must cease communication with 
issuers prior to interviews. In addition, this proposed rule change is 
substantially similar to an NYSE proposal.\12\ For these reasons, the 
Commission designates that the proposed rule change become operative 
immediately upon filing.\13\
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    \12\ See supra note 4.
    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate the 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:

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-NYSEALTR-2008-21 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-NYSEALTR-2008-21. 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, on official 
business days between the hours of 10 a.m. and 3 p.m. Copies of the 
filing also will be available for

[[Page 3125]]

inspection and copying at the principal office of the Exchange. 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-NYSEALTR-2008-21 and should 
be submitted on or before February 6, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-930 Filed 1-15-09; 8:45 am]

BILLING CODE 8011-01-P