Document ID: SEC-2006-0792-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc.
Posted Date: 2006-06-21T04:00Z

[Federal Register: June 21, 2006 (Volume 71, Number 119)]
[Notices]               
[Page 35721-35723]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21jn06-157]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53994; File No. SR-NASD-2006-071]

 
Self-Regulatory Organizations: National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to Technical Amendments to Rule 3210

June 15, 2006.
    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 2, 2006, the 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 NASD. NASD has 
designated the proposed rule change as constituting a ``non-
controversial'' rule change under paragraph (f)(6) of

[[Page 35722]]

Rule 19b-4 under the Act,\3\ which renders the proposal effective upon 
receipt of this filing by 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\ 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

    NASD is proposing to amend NASD Rule 3210 to change references to 
paragraph ``(b)(1)'' in Rule 3210 to paragraph ``(b)'' in Rule 3210. 
Below is the text of the proposed rule change. Proposed deletions are 
in brackets.
* * * * *

3210. Short Sale Delivery Requirements

    (a) No Change.
    (b) The provisions of this rule shall not apply to the amount of 
the fail to deliver position that the participant of a registered 
clearing agency had at a registered clearing agency on the settlement 
day immediately preceding the day that the security became a non-
reporting threshold security; provided, however, that if the fail to 
deliver position at the clearing agency is subsequently reduced below 
the fail to deliver position on the settlement day immediately 
preceding the day that the security became a non-reporting threshold 
security, then the fail to deliver position excepted by this paragraph 
(b)[(1)] shall be the lesser amount.
    (c) through (g) No Change.
* * * * *

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
    On April 4, 2006, the SEC approved new Rule 3210, Short Sale 
Delivery Requirements, which applies a short sale delivery framework to 
those equity securities not otherwise covered by the delivery 
requirements of Regulation SHO, namely non-reporting OTC equity 
securities.\4\ There is an incorrect paragraph reference in Rule 
3210(b). Accordingly, NASD is filing this proposed rule change to amend 
Rule 3210(b) to change references to paragraph ``(b)(1)'' and replace 
it with paragraph ``(b).''
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    \4\ See Securities Exchange Act Release No. 53596 (April 4, 
2006), 71 FR 18392 (April 11, 2006) (File No. SR-NASD-2004-044).
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    NASD proposes to make the proposed rule change effective on July 3, 
2006 to coincide with the effective date of Rule 3210.
2. Statutory Basis
    NASD believes that the proposed rule change is consistent with the 
provisions of section 15A(b)(6) of the Act,\5\ which requires, among 
other things, that NASD 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. NASD believes that amending the references to the 
incorrect subparagraph in Rule 3210 will eliminate confusion when 
reading the provisions of Rule 3210.
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    \5\ 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 and Rule 
19b-4(f)(6) thereunder.\6\
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    \6\ 17 CFR 240.19b-4(f)(6).
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    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.

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-2006-071 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-2006-071. 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-2006-071 
and should be submitted on or before July 12, 2006.

[[Page 35723]]

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
Nancy M. Morris,
Secretary.
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    \7\ 17 CFR 200.30-3(a)(12).
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[FR Doc. E6-9723 Filed 6-20-06; 8:45 am]

BILLING CODE 8010-01-P