Document ID: SEC-2010-0135-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing of Proposed Rule Change To Amend Rule 2810 To Reflect Changes To Corresponding FINRA Rule
Posted Date: 2010-01-26T05:00Z

[Federal Register: January 26, 2010 (Volume 75, Number 16)]
[Notices]               
[Page 4129-4130]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26ja10-111]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61373; File No. SR-BX-2010-003]

 
 Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of 
Filing of Proposed Rule Change To Amend Rule 2810 To Reflect Changes To 
Corresponding FINRA Rule

January 15, 2010.
    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 5, 2010, NASDAQ OMX BX. Inc. (the ``Exchange'' or ``BX'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the Exchange. The Exchange has designated 
the proposed rule change as constituting a non-controversial rule 
change under Rule 19b-4(f)(6) under the Act,\3\ which renders the 
proposal effective upon filing with 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

    The Exchange is filing this proposed rule change to amend BX Rule 
2810 to reflect recent changes to a corresponding rule of the Financial 
Industry Regulatory Authority (``FINRA''). BX will implement the 
proposed rule change thirty days after the date of the filing. The text 
of the proposed rule change is available at http://
nasdaqomxbx.cchwallstreet.com, at the Exchange's principal office, 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, the Exchange 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. The Exchange 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
    Many of BX's rules are based on rules of FINRA (formerly the 
National Association of Securities Dealers (``NASD'')). During 2008, 
FINRA embarked on an extended process of moving rules formerly 
designated as ``NASD Rules'' into a consolidated FINRA rulebook. In 
most cases, FINRA has renumbered these rules, and in some cases has 
substantively amended them. Accordingly, BX also proposes to initiate a 
process of modifying its rulebook to ensure that BX rules corresponding 
to FINRA rules continue to mirror them as closely as practicable. In 
some cases, it will not be possible for the rule numbers of BX rules to 
mirror corresponding FINRA rules, because existing or planned BX rules 
make use of those numbers. However, wherever possible, BX plans to 
update its rules to reflect changes to corresponding FINRA rules.
    This filing addresses BX Rule 2810, which formerly corresponded to 
NASD 2810, and which addresses underwriting terms and arrangements in 
public offerings of direct participation programs and unlisted real 
estate

[[Page 4130]]

investments trusts (collectively, ``Investment Programs''). In SR-
FINRA-2009-016,\4\ FINRA re-designated NASD Rule 2810 as FINRA Rule 
2310 with no material change. FINRA Rule 2310 requires that members 
participating in a public offering of an Investment Program meet 
certain requirements regarding underwriting compensation, fees and 
expenses, perform due diligence on the Investment Program, follow 
specific guidelines on suitability, and adhere to limits on non-cash 
compensation.
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    \4\ Securities Exchange Act Release No. 59987 (May 27, 2009), 74 
FR 106 [sic] (June 4, 2009) (SR-FINRA-2009-016).
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    BX is adopting the new FINRA rule in full. Because the BX Rules 
currently contain a Rule 2310, it will re-designate Rule 2810 as BX 
Rule 2310A, so as to closely correspond to the new FINRA rule number.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act,\5\ in general, and with 
Sections [sic] 6(b)(5) of the Act,\6\ in particular, in that the 
proposal 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 regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, 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. 
The proposed changes will conform BX Rule 2810 to recent changes made 
to a corresponding FINRA rule, to promote application of consistent 
regulatory standards.
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    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange 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, as amended.

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 \7\ and Rule 19b-
4(f)(6) thereunder.\8\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 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-BX-2010-003 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 Number SR-BX-2010-003. 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-BX-2010-003 and should be 
submitted on or before February 16, 2010.
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    \9\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-1440 Filed 1-25-10; 8:45 am]
BILLING CODE 8011-01-P