Federal Register: March 10, 2003 (Volume 68, Number 46)
DOCID: FR Doc 03-5564
SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission
DOCUMENT ID: [Release No. 34-47436; File No. SR-NASD-2003-26]
NOTICE: NOTICES
ACTION: Self-regulatory organizations; proposed rule changes:
SUBJECT CATEGORY:
Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the National Association of Securities Dealers, Inc. To Extend a Pilot Program Regarding the Regulatory Fee and the Trading Activity Fee
DOCUMENT SUMMARY:
March 4, 2003.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b4 thereunder,\2\ notice is hereby given that
on February 28, 2003, the National Association of Securities Dealers,
Inc. (``NASD'') 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 by the NASD. The NASD filed
the proposal pursuant to Section 19(b)(3)(A) of the Act,\3\ and Rule
19b4(f)(6) thereunder,\4\ which renders the proposal effective upon
filing with the Commission.\5\ The Commission is publishing this notice
to solicit comments on the proposed rule change from interested persons.
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b4(f)(6).
\5\ The NASD asked the Commission to waive the fiveday pre
filing notice requirement and the 30day operative delay. 17 CFR 240.19b4(f)(6).
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
NASD proposes to extend the pilot program for the Trading Activity
Fee (``TAF'') through April 1, 2003. The TAF pilot program is currently
in effect, and is set to expire on March 1, 2003.\6\ NASD has requested
that the Commission approve SRNASD2002148,\7\ so that the TAF will
be made permanent before the expiration of the TAF pilot program on
April 1, 2003. If the Commission does not approve SRNASD2002148, the
trading fee component of the member regulatory pricing structure will
revert to Section 8 of Schedule A to the NASD ByLaws, as amended. The
NASD is making no substantive changes to the pilot program, other than extending the expiration date through April 1, 2003.
\6\ See Securities Exchange Act Release No. 46416 (August 23,
2002), 67 FR 55901 (August 30, 2002) (SRNASD200298). See also
Securities Exchange Act Release No. 47112 (December 31, 2002), 68 FR 824 (January 7, 2003)(SRNASD2002182).
\7\ See Securities Exchange Act Release No. 46817 (November 12, 2002), 67 FR 69785 (November 19, 2002)(SRNASD2002148).
II. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the NASD 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 Association has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such statements.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. Purpose
On July 24, 2002, the NASD filed SRNASD200298, which proposed a
new member regulatory pricing structuring, including a new TAF, to
replace the existing trading fee contained in Section 8 of Schedule A
to the NASD ByLaws.\8\ The proposed rule change was effective upon
filing with the Commission pursuant to Section 19(b)(3)(A)(ii) of the
Act \9\ and Rule 19b4(f)(2) \10\ thereunder. SRNASD200298 is
currently in effect. Assessments under the new TAF were effective as of
October 1, 2002, payable January 15, 2003.\11\ On October 18, 2002, the
NASD established a sunset provision whereby the TAF established in SR
NASD200298 would cease to exist after December 31, 2002. At the same
time, the NASD filed SRNASD2002148, which is substantially similar
to SRNASD200298, but filed under Section 19(b)(1) of the Act, to
allow for additional member comment. Upon expiration of SRNASD2002
98, the member regulatory pricing structure was to revert to Section 8 of Schedule A to the NASD ByLaws, as amended.
\8\ See Securities Exchange Act Release No. 46416 (August 23,
2002), 67 FR 55901 (August 30, 2002) (SRNASD200298). See also,
Securities Exchange Act Release No. 46417 (August 23, 2002), 67 FR
55893 (August 30, 2002) (SRNASD200299). The NASD also published
three Notices to Members describing the proposed changes and
addressing interpretive questions posed by NASD members. See Notices
to Members 0241 (July 2002), 0263 (September 2002), and 0275 (November 2002).
\9\ 15 U.S.C. 78s(b)(3)(A)(ii).
\10\ 17 CFR 240.19b4(f)(2).
\11\ Member firms were required to pay the TAF in accordance
with the pilot program (for the first quarter starting October 1,
2002) by no later than January 15, 2003, and thereafter on a monthly basis.
On December 24, 2002, the NASD extended the TAF pilot program through March 1, 2003. With the instant rule filing, the NASD is further extending the TAF pilot program through April 1, 2003, to allow additional time for the NASD to respond to comments to the original filing, and to allow the Commission more time to review issues presented by the permanent TAF proposed rule change (SRNASD2002148). The NASD asks the Commission to approve SRNASD2002148 before the expiration of the TAF pilot program on April 1, 2003, to make the TAF pilot permanent.
2. Statutory Basis
The NASD believes that the proposed rule change is consistent with
the provisions of Section 15A of the Act,\12\ in general, and with
Section 15A(b)(5) of the Act,\13\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees, and other
charges among members and issuers and other persons using any facility or system that the NASD operates or controls.
\12\ 15 U.S.C. 78o3.
\13\ 15 U.S.C. 78o3(b)(5).
B. SelfRegulatory Organization's Statement on Burden on Competition
The NASD 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. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received. Written
comments, however, have been solicited on SRNASD200298, SRNASD
2002147, SRNASD2002148, and SRNASD2002182. The comments are not
addressed herein, but are, as appropriate, discussed in connection with the respective rule filings.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
Because the foregoing proposed rule change does not: [[Page 11423]]
(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 \14\ and
Rule 19b4(f)(6) thereunder.\15\ 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.
\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b4(f)(6).
The NASD has requested that the Commission waive the fiveday pre filing notice requirement and the 30day operative delay. The Commission believes waiving the fiveday prefiling notice requirement and the 30day operative delay is consistent with the protection of investors and the public interest. Acceleration of the operative date will allow the pilot to operate without interruption through April 1, 2003. For these reasons, the Commission designates the proposal to be effective and operative upon filing with the Commission.\16\ \16\ For purposes only of accelerating the operative date of this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposal is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 205490609. 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. Copies of such filing will also be available for inspection and copying at the principal office of the NASD. All submissions should refer to file number SRNASD200326 and should be submitted by March 31, 2003.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.\17\
\17\ 17 CFR 200.303(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 035564 Filed 3703; 8:45 am]
BILLING CODE 801001P
SUMMARY:
National Association of Securities Dealers, Inc.,
DOCUMENT BODY 2:
March 4, 2003.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b4 thereunder,\2\ notice is hereby given that
on February 28, 2003, the National Association of Securities Dealers,
Inc. (``NASD'') 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 by the NASD. The NASD filed
the proposal pursuant to Section 19(b)(3)(A) of the Act,\3\ and Rule
19b4(f)(6) thereunder,\4\ which renders the proposal effective upon
filing with the Commission.\5\ The Commission is publishing this notice
to solicit comments on the proposed rule change from interested persons.
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b4(f)(6).
\5\ The NASD asked the Commission to waive the fiveday pre
filing notice requirement and the 30day operative delay. 17 CFR 240.19b4(f)(6).
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
NASD proposes to extend the pilot program for the Trading Activity
Fee (``TAF'') through April 1, 2003. The TAF pilot program is currently
in effect, and is set to expire on March 1, 2003.\6\ NASD has requested
that the Commission approve SRNASD2002148,\7\ so that the TAF will
be made permanent before the expiration of the TAF pilot program on
April 1, 2003. If the Commission does not approve SRNASD2002148, the
trading fee component of the member regulatory pricing structure will
revert to Section 8 of Schedule A to the NASD ByLaws, as amended. The
NASD is making no substantive changes to the pilot program, other than extending the expiration date through April 1, 2003.
\6\ See Securities Exchange Act Release No. 46416 (August 23,
2002), 67 FR 55901 (August 30, 2002) (SRNASD200298). See also
Securities Exchange Act Release No. 47112 (December 31, 2002), 68 FR 824 (January 7, 2003)(SRNASD2002182).
\7\ See Securities Exchange Act Release No. 46817 (November 12, 2002), 67 FR 69785 (November 19, 2002)(SRNASD2002148).
II. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the NASD 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 Association has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such statements.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. Purpose
On July 24, 2002, the NASD filed SRNASD200298, which proposed a
new member regulatory pricing structuring, including a new TAF, to
replace the existing trading fee contained in Section 8 of Schedule A
to the NASD ByLaws.\8\ The proposed rule change was effective upon
filing with the Commission pursuant to Section 19(b)(3)(A)(ii) of the
Act \9\ and Rule 19b4(f)(2) \10\ thereunder. SRNASD200298 is
currently in effect. Assessments under the new TAF were effective as of
October 1, 2002, payable January 15, 2003.\11\ On October 18, 2002, the
NASD established a sunset provision whereby the TAF established in SR
NASD200298 would cease to exist after December 31, 2002. At the same
time, the NASD filed SRNASD2002148, which is substantially similar
to SRNASD200298, but filed under Section 19(b)(1) of the Act, to
allow for additional member comment. Upon expiration of SRNASD2002
98, the member regulatory pricing structure was to revert to Section 8 of Schedule A to the NASD ByLaws, as amended.
\8\ See Securities Exchange Act Release No. 46416 (August 23,
2002), 67 FR 55901 (August 30, 2002) (SRNASD200298). See also,
Securities Exchange Act Release No. 46417 (August 23, 2002), 67 FR
55893 (August 30, 2002) (SRNASD200299). The NASD also published
three Notices to Members describing the proposed changes and
addressing interpretive questions posed by NASD members. See Notices
to Members 0241 (July 2002), 0263 (September 2002), and 0275 (November 2002).
\9\ 15 U.S.C. 78s(b)(3)(A)(ii).
\10\ 17 CFR 240.19b4(f)(2).
\11\ Member firms were required to pay the TAF in accordance
with the pilot program (for the first quarter starting October 1,
2002) by no later than January 15, 2003, and thereafter on a monthly basis.
On December 24, 2002, the NASD extended the TAF pilot program through March 1, 2003. With the instant rule filing, the NASD is further extending the TAF pilot program through April 1, 2003, to allow additional time for the NASD to respond to comments to the original filing, and to allow the Commission more time to review issues presented by the permanent TAF proposed rule change (SRNASD2002148). The NASD asks the Commission to approve SRNASD2002148 before the expiration of the TAF pilot program on April 1, 2003, to make the TAF pilot permanent.
2. Statutory Basis
The NASD believes that the proposed rule change is consistent with
the provisions of Section 15A of the Act,\12\ in general, and with
Section 15A(b)(5) of the Act,\13\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees, and other
charges among members and issuers and other persons using any facility or system that the NASD operates or controls.
\12\ 15 U.S.C. 78o3.
\13\ 15 U.S.C. 78o3(b)(5).
B. SelfRegulatory Organization's Statement on Burden on Competition
The NASD 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. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received. Written
comments, however, have been solicited on SRNASD200298, SRNASD
2002147, SRNASD2002148, and SRNASD2002182. The comments are not
addressed herein, but are, as appropriate, discussed in connection with the respective rule filings.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
Because the foregoing proposed rule change does not: [[Page 11423]]
(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 \14\ and
Rule 19b4(f)(6) thereunder.\15\ 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.
\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b4(f)(6).
The NASD has requested that the Commission waive the fiveday pre filing notice requirement and the 30day operative delay. The Commission believes waiving the fiveday prefiling notice requirement and the 30day operative delay is consistent with the protection of investors and the public interest. Acceleration of the operative date will allow the pilot to operate without interruption through April 1, 2003. For these reasons, the Commission designates the proposal to be effective and operative upon filing with the Commission.\16\ \16\ For purposes only of accelerating the operative date of this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposal is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 205490609. 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. Copies of such filing will also be available for inspection and copying at the principal office of the NASD. All submissions should refer to file number SRNASD200326 and should be submitted by March 31, 2003.
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.\17\
\17\ 17 CFR 200.303(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 035564 Filed 3703; 8:45 am]
BILLING CODE 801001P