Document ID: SEC-2012-0175-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Financial Industry Regulatory Authority, Inc.
Posted Date: 2012-02-01T05:00Z

[Federal Register Volume 77, Number 21 (Wednesday, February 1, 2012)]
[Notices]
[Pages 5069-5070]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-2132]

[[Page 5069]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66244; File No. SR-FINRA-2012-003]

Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Notice of Filing and Immediate Effectiveness of 
Proposed Rule Change To Delay the Implementation Date of SR-FINRA-2011-
019

 January 26, 2012.
    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 January 20, 2012, Financial Industry Regulatory Authority, Inc. 
(``FINRA'') filed with the Securities and Exchange Commission (``SEC'' 
or ``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by FINRA. FINRA has designated 
the proposed rule change as constituting a ``non-controversial'' rule 
change under paragraph (f)(6) of 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(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    FINRA is proposing a rule change to delay the implementation date 
of amendments that became effective pursuant to SR-FINRA-2011-019. The 
proposed rule change would not make any changes to the text of FINRA 
rules.
    The text of the proposed rule change is available on FINRA's Web 
site at http://www.finra.org, at the principal office of FINRA 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, FINRA 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. FINRA 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 25, 2011, FINRA filed an immediately effective proposed 
rule change to rename the OTC Bulletin Board (``OTCBB'') as the Non-NMS 
Quotation Service (``NNQS'').\4\ In the Original Filing, FINRA stated 
that the implementation date of the proposed rule change would be no 
later than 270 days following the date of filing of the proposed rule 
change, but in no event would be sooner than 120 days following the 
date of filing of the proposed rule change.\5\ FINRA is revising the 
timeframe for the implementation date of SR-FINRA-2011-019 to allow 
additional time for the renaming of OTCBB as NNQS, transitioning of the 
related domain name, and consummation of the sale transaction discussed 
in the Original Filing.\6\ FINRA will announce the implementation date 
of the changes effected pursuant to SR-FINRA-2011-019 at a later date; 
however, the implementation date will be no sooner than 120 days 
following the date of filing of this proposed rule change, but no later 
than December 31, 2012.\7\
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    \4\ See Securities Exchange Act Release No. 64397 (May 4, 2011); 
76 FR 27123 (May 10, 2011) (``SR-FINRA-2011-019'' or ``Original 
Filing'').
    \5\ Upon implementation of the proposed rule change, FINRA's 
interdealer quotation system will be known as NNQS, and FINRA no 
longer will own the www.OTCBB.com Web site.
    \6\ See Original Filing. See also Rodman & Renshaw Capital 
Group, Inc., Press Release September 14, 2010 (Rodman and FINRA 
Reach Preliminary Agreement on Terms for Rodman Acquisition of OTCBB 
Assets).
    \7\ FINRA will continue its concerted communications campaign to 
ensure that the public (including retail investors) is well-informed 
with respect to the pending changes. See www.OTCBB.com August 1, 
2011 news item, available at www.otcbb.com/news/2011/GeneralNews/080111.stm.
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    FINRA has filed the proposed rule change for immediate 
effectiveness and has requested that the SEC waive the requirement that 
the proposed rule change not become operative for 30 days after the 
date of the filing, such that FINRA can implement the proposed rule 
change immediately.
2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the 
provisions of Section 15A(b)(6) of the Act,\8\ which requires, among 
other things, that FINRA 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. Section 15A(b)(11) of the Act \9\ requires that FINRA 
rules include provisions governing the form and content of quotations 
relating to securities sold otherwise than on a national securities 
exchange which may be distributed or published by any member or person 
associated with a member, and the persons to whom such quotations may 
be supplied. In addition, Section 15A(b)(11) of the Act\10\ requires 
that such rules be designed to produce fair and informative quotations, 
to prevent fictitious or misleading quotations, and to promote orderly 
procedures for collecting, distributing, and publishing quotations.
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    \8\ 15 U.S.C. 78o-3(b)(6).
    \9\ 15 U.S.C. 78o-3(b)(11).
    \10\ 15 U.S.C. 78o-3(b)(11).
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    FINRA believes the proposed rule change is consistent with Sections 
15A(b)(6) and (11) of the Act in that it facilitates FINRA's continued 
ability to operate an interdealer quotation system for use by market 
makers in OTC equity securities that is functionally identical to the 
service provided under the current name, thereby supporting the 
availability of quotation information in the over-the-counter equity 
securities market.

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

    FINRA 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

    FINRA has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \11\ and Rule 19b-4(f)(6) thereunder.\12\ 
Because the 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 prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the

[[Page 5070]]

proposed rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \13\ and Rule 19b-4(f)(6)(iii) thereunder.\14\
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    \11\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the self-regulatory organization to give the Commission 
written notice of the self-regulatory organization's 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. FINRA has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \15\ normally 
does not become operative for 30 days after the date of filing. 
However, pursuant to Rule 19b-4(f)(6)(iii) \16\ the Commission may 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. FINRA has asked the 
Commission to waive the 30-day operative delay so that the proposal may 
become operative immediately upon filing.
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    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
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    The Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest, as 
it will allow FINRA immediately to delay the implementation date of 
amendments to various FINRA rules regarding the renaming of the OTCBB 
service. For this reason, the Commission designates the proposed rule 
change as operative upon filing.\17\
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    \17\ For purposes only of waiving the 30-day operative delay, 
the Commission has also 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 summarily may temporarily suspend 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 email to rule-comments@sec.gov. Please include 
File No. SR-FINRA-2012-003 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 No. SR-FINRA-2012-003. This file 
number should be included on the subject line if email 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 Web site viewing and 
printing 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 such filing also will be available for 
inspection and copying at the principal office of FINRA. 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 No. SR-FINRA-2012-003 and should be 
submitted on or before February 22, 2012.
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    \18\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-2132 Filed 1-31-12; 8:45 am]
BILLING CODE 8011-01-P