Document ID: SEC-2010-0218-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Financial Industry Regulatory Authority, Inc.
Posted Date: 2010-02-09T05:00Z

[Federal Register: February 9, 2010 (Volume 75, Number 26)]
[Notices]               
[Page 6422-6423]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09fe10-107]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61473; File No. SR-FINRA-2009-087]

 
Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Order Approving Proposed Rule Change To Repeal NASD 
Rules 2760 and 2780, Incorporated NYSE Rules 2B and 411, and the 
Interpretation to Incorporated NYSE Rule 411(a)(ii)(5) as Part of the 
Process of Developing the Consolidated FINRA Rulebook

February 2, 2010.
    On December 4, 2009, 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 
proposed rule change to repeal NASD Rule 2760 (Offerings ``At the 
Market''), NASD Rule 2780 (Solicitation of Purchases on an Exchange to 
Facilitate a Distribution of Securities), Incorporated NYSE Rule 2B (No 
Affiliation between Exchange and any Member Organization), Incorporated 
NYSE Rule 411 (Erroneous Reports) and the Interpretation to 
Incorporated NYSE Rule 411(a)(ii)(5) as part of the process of 
developing a consolidated FINRA rulebook. The proposed rule change was 
published for comment in the Federal Register on December 29, 2009.\3\ 
The Commission received no comments on the proposal. This order 
approves the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 61211 (December 18, 
2009), 74 FR 68889. (``Notice'').
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    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 association.\4\ In 
particular, the Commission finds 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 FINRA rules be designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade, and, in

[[Page 6423]]

general, to protect investors and the public interest.
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    \4\ 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).
    \5\ 15 U.S.C. 78o-3(b)(6).
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    The Commission believes that the proposed rule change is 
appropriate to eliminate confusion and reduce regulatory overlap by 
repealing rules that are similar to federal rules and regulations or 
are specific to the NYSE and its marketplace. As further described in 
the Notice, FINRA stated that NASD Rule 2760 is similar to the 
Commission's Rule 15c1-8 under the Act,\6\ which FINRA believes 
appropriately protects investors without duplication by NASD Rule 2760. 
FINRA also stated that NASD Rule 2780 duplicates the Commission's Rule 
10b-2, which was rescinded by the Commission in 1993 because it was 
duplicative of other provisions of the federal securities laws, 
including the Commission's Regulation M.\7\ Therefore, FINRA believes 
that NASD Rule 2780 should be deleted. In addition, FINRA stated that 
NYSE Rules 2B and 411 and the Interpretation to Incorporated NYSE Rule 
411(a)(ii)(5) relate to activity that concerns solely the NYSE 
marketplace and, in the case of Rule 411(b)(2), is duplicative of 
existing Commission recordkeeping requirements. Thus, FINRA believes 
that these Incorporated NYSE Rules and Interpretation should not be 
included in the consolidated FINRA rulebook. In approving this proposed 
rule change, the Commission notes that FINRA members and their 
associated persons are required to comply with all applicable federal 
securities laws and that FINRA, as a self-regulatory organization, has 
the obligation to have the capacity to enforce compliance by its 
members and their associated persons with the Act and the rules and 
regulations thereunder.
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    \6\ 17 CFR 240.15c1-8.
    \7\ See Securities Exchange Act Release No. 32100 (April 2, 
1993), 58 FR 18145 (April 8, 1993).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\8\ proposed rule change (SR-FINRA-2009-087) be, and it hereby is, 
approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-2734 Filed 2-8-10; 8:45 am]
BILLING CODE 8011-01-P