Document ID: SEC-2007-1135-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: International Securities Exchange, LLC
Posted Date: 2007-08-15T04:00Z

[Federal Register: August 15, 2007 (Volume 72, Number 157)]
[Notices]               
[Page 45848]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15au07-127]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56225; File No. SR-ISE-2007-32]

 
Self-Regulatory Organizations; International Securities Exchange, 
LLC; Order Approving Proposed Rule Change as Modified by Amendment No. 
1 Thereto To Remove Certain Rules From Its Rulebook

 August 8, 2007.
    On May 9, 2007, the International Securities Exchange, LLC (the 
``Exchange'' or the ``ISE''), 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 remove certain ISE rules. On 
June 8, 2007, ISE filed Amendment No. 1 to the proposed rule change. 
The proposed rule change was published for comment in the Federal 
Register on June 27, 2007.\3\ The Commission received no comments on 
the proposal.
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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. 55936 (June 21, 
2007), 72 FR 35276 (``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 registered securities exchange.\4\ In 
particular, the Commission finds that the proposed rule change is 
consistent with Section 6(b)(5) of the Act,\5\ which requires, among 
other things, that the Exchange's rules be designed to promote just and 
equitable principles of trade, to remove impediments to and perfect the 
mechanism for a free and open market and a national market system, and, 
in general, to protect investors and the public interest.
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    \4\ In approving this proposal, the Commission considered the 
proposed rule's impact on efficiency, competition and capital 
formation. 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f(b)(5).
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    The ISE proposes to remove Rule 403 (Nominal Employment), Rule 605 
(Other Affiliations of Registered Persons), and Rule 615 (Addressing of 
Communications to Customers). The Exchange believes that the concern 
addressed by Rule 403, which prohibits members from obtaining business 
by employing a person in a nominal position, is adequately addressed in 
existing Rule 406, which limits gratuities.\6\ The Exchange also 
believes that Rule 605, which effectively prohibits registered persons 
of its members from engaging in outside business activities unless 
approved by the Exchange or the member's designated examining 
authority, is no longer necessary given significant market structure 
changes.\7\ Lastly, the Exchange believes that Rule 615 is unnecessary 
as ISE members are also subject to ISE Rules 600 and 2114, which 
effectively require ISE members that do a public business to be 
registered with FINRA, and the Exchange believes that the FINRA rules 
pertaining to the customer communication policies for its members 
conducting a public business should sufficiently address the topic 
covered by Rule 615. The Commission therefore believes it is consistent 
with the Act for the Exchange to delete these rules.
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    \6\ Rule 406 prohibits a member from giving any compensation or 
gratuity in any one year in excess of $50.00 to any employee of the 
Exchange or in excess of $100.00 to any employee of any other member 
or of any non-member broker, dealer, bank or institution, without 
the prior consent of the employer and of the Exchange.
    \7\ The Exchange also notes that rules of the Financial Industry 
Regulatory Authority Inc. (``FINRA'')(f/k/a the National Association 
of Securities Dealers, Inc.) governing its members' dealing with the 
public do not have a comparable provision.
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\8\ that the proposed rule change (File No. SR-ISE-2007-32), as 
modified by Amendment No. 1, be, and hereby is, approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-15902 Filed 8-14-07; 8:45 am]

BILLING CODE 8010-01-P