Document ID: SEC-2008-0733-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: New York Stock Exchange LLC
Posted Date: 2008-05-23T04:00Z

[Federal Register: May 23, 2008 (Volume 73, Number 101)]
[Notices]               
[Page 30178-30179]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23my08-125]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57833; File No. SR-NYSE-2008-35]

 
Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Order Granting Accelerated Approval of Proposed 
Rule Change To Amend Section 703.21 of the Listed Company Manual 
Relating to Equity-Linked Debt Securities

May 19, 2008.
    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 May 2, 2008, the New York Stock Exchange LLC (``NYSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared substantially by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons and is granting 
accelerated approval to the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Section 703.21 of the Listed Company 
Manual (``Manual'') to clarify the application of Rule 19b-4(e) under 
the Act \3\ to the listing of equity-linked debt securities (``ELDS''). 
The text of the proposed rule change is available at the Exchange, the 
Commission's Public Reference Room, and http://www.nyse.com.
---------------------------------------------------------------------------

    \3\ 17 CFR 240.19b-4(e).
---------------------------------------------------------------------------

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, NYSE included statements 
concerning the purpose of, and basis for, the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item III below. NYSE 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
    Section 703.21 of the Manual provides that the Exchange will 
consider listing ELDS that meet the criteria of Section 703.21. ELDS 
are non-convertible debt of an issuer where the value of the debt is 
based, at least in part, on the value of another issuer's common stock, 
non-convertible preferred stock, common units of a master limited 
partnership, or any other common equity security of a type classified 
for trading as stocks by the Exchange.
    The Exchange proposes to make explicit that Rule 19b-4(e) under the 
Act applies to the listing of ELDS that meet the criteria of paragraphs 
(A) through (D) of Section 703.21 of the Manual. The Exchange states 
that these criteria, therefore, constitute ``generic'' listing criteria 
for ELDS, and the Exchange would file an appropriate Form 19b-4(e) with 
the Commission within five days of listing a series of ELDS under the 
generic listing criteria. The proposed rule change would also provide 
that the Exchange may submit a rule filing pursuant to Section 19(b)(2) 
of the Act \4\ to permit the listing and trading of ELDS that do not 
otherwise meet the standards set forth in paragraphs (A) through (D) of 
Section 703.21 of the Manual.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

    The Exchange also proposes to amend paragraph (D) of Section 703.21 
to refer to the Commission's Division of Trading and Markets.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) \5\ of the Act, in general, and furthers the 
objectives of Section 6(b)(5),\6\ in particular, in that it is designed 
to prevent fraudulent and manipulative acts and practices, to promote 
just and equitable principles of trade, to foster cooperation and 
coordination with persons engaged in facilitating transactions in 
securities, and to remove impediments to and perfect the mechanisms of 
a free and open market and a national market system. The Exchange 
believes that the proposed rule change clarifies the application of 
Rule 19b-4(e) under the Act to the listing of ELDS. This facilitates 
the listing and trading of such securities on the Exchange, thereby

[[Page 30179]]

enhancing competition among market participants, to the benefit of 
investors and the marketplace.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    NYSE 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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

III. 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 (www.sec.gov/
rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSE-2008-35 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-NYSE-2008-35. 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 the filing also will be available for 
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-NYSE-2008-35 and should be 
submitted on or before June 13, 2008.

IV. Commission's Findings and Order Granting Accelerated Approval of 
the Proposed Rule Change

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to a national securities 
exchange.\7\ In particular, the Commission finds that the proposed rule 
change is consistent with Section 6(b)(5) of the Act,\8\ which requires 
that the rules of an exchange be designed, among other things, 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.
---------------------------------------------------------------------------

    \7\ In approving this rule change, the Commission notes that it 
has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Commission finds good cause for approving this proposal before 
the 30th day after the publication of notice thereof in the Federal 
Register. The proposal seeks to clarify that the Exchange's listing and 
trading of ELDS under Section 703.21 of the Manual is subject to Rule 
19b-4(e) under the Act. The proposal also clarifies the process for 
listing and trading ELDS that do not meet the standards of paragraphs 
(A) through (D) of Section 703.12 of the Manual. The Commission does 
not believe that these clarifications raise any novel regulatory 
issues.
    Therefore, the Commission believes that accelerating approval of 
this proposal is appropriate and would ensure that the Exchange's rules 
clearly reflect the standards for listing and trading of ELDS and 
conform the NYSE's rules to those of other exchanges without delay.\9\
---------------------------------------------------------------------------

    \9\ See e.g., Chicago Board Options Exchange Rule 31.5(I) and 
NYSE Arca Rule 5.2(j)(2).
---------------------------------------------------------------------------

V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\10\ that the proposed rule change (SR-NYSE-2008-35), be, and it 
hereby is, approved on an accelerated basis.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-11550 Filed 5-22-08; 8:45 am]

BILLING CODE 8010-01-P