[Federal Register Volume 76, Number 216 (Tuesday, November 8, 2011)]
[Notices]
[Pages 69316-69318]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-28828]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-65667; File No. SR-Phlx-2011-136]
Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of
Filing of Proposed Rule Change Relating to Transfer of Exchange House
Accounts
November 2, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given
that on October 19, 2011, NASDAQ OMX PHLX LLC (``Phlx'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, II, and III, below, which Items have been prepared by the
Exchange. 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 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange, pursuant to Section 19(b)(1) of the Act \3\ and Rule
19b-4 thereunder,\4\ proposes a new Exchange Rule 912 entitled
``Transfer of Accounts'' to codify a current Exchange policy with
respect to the transfer of accounts.
---------------------------------------------------------------------------
\3\ 15 U.S.C. 78s(b)(1).
\4\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
The text of the proposed rule change is available on the Exchange's
Web site at http://www.nasdaqtrader.com/micro.aspx?id=PHLXRulefilings,
at the principal office of the Exchange, 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.
[[Page 69317]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of the proposed rule change is to codify the Exchange's
current policy with respect to the transfer of accounts by
memorializing the policy in a new Exchange Rule 912 entitled ``Transfer
of Accounts.'' \5\ The proposed new rule should provide member
organizations guidance with respect to requests to transfer accounts
either to or from a member organization.\6\
---------------------------------------------------------------------------
\5\ Exchange Rule 912 is currently reserved. The Exchange
proposes to delete the word ``Reserved'' and insert this new Rule in
its place.
\6\ These accounts are Phlx member house accounts which are
assigned by the Exchange's Membership Department. These Phlx house
accounts are not customer accounts but rather are assigned to Phlx
member firms and utilized by members to transact business on the
Exchange. These accounts uniquely identify each member for various
reasons, including but not limited to: audit trail, clearing and
billing. This will have no impact on member registrations.
---------------------------------------------------------------------------
Proposed new Exchange Rule 912 would require a member organization
to notify the Exchange's Membership Department, in writing, to transfer
an account either to or from a member organization. The Exchange would
also require member organizations to execute a Letter of Indemnity \7\
in order to obligate the successor and assigns of the account(s) to
accept full responsibility for payment of all outstanding Exchange
fees, dues, fines and/or charges.
---------------------------------------------------------------------------
\7\ This is a standard form that is required to be completed by
members desiring to transfer their Phlx account.
---------------------------------------------------------------------------
By way of example, if a member organization acquired another member
organization and wished to maintain the acquired member's current
account assignments, the surviving member organization would be
required, pursuant to this proposed Rule, to submit a request to the
Exchange's Membership Department for a transfer of those accounts to
itself. Another example might be an individual currently employed as a
member by one organization who elects to transfer his affiliation to
another member organization. In that regard, that individual may wish
to maintain the account that is already assigned and request that the
Membership Department reassign the account to the new member
organization. Any member organization may request an account transfer
from the Exchange's Membership Department. However, both member
organizations involved must consent to the transfer prior to it
becoming effective.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act \8\ in general, and furthers the objectives of Section
6(b)(5) of the Act \9\ in particular, in that it is designed to promote
just and equitable principles of trade, 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,
by providing an accommodation for members and member organizations who
desire to transfer accounts. The Exchange believes that memorializing
its current policy within an Exchange Rule will provide member
organizations clear guidelines on procedures related to transfers of
accounts. In addition, the Exchange will require member organizations
to execute a Letter of Indemnity to clearly delineate which firm has
responsibility for liabilities associated with the accounts. The
Exchange believes that the proposed rule creates an orderly process for
allowing such transfers and reduces risk by clearly allocating
financial responsibilities with respect to the accounts.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition 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
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) As the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission shall: (a) By order approve
or disapprove such proposed rule change, or (b) institute proceedings
to determine whether the proposed rule change should be disapproved.
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 [email protected]. Please include
File Number SR-Phlx-2011-136 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-Phlx-2011-136. 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 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-Phlx-2011-136 and should be
submitted on or before November 29, 2011.
[[Page 69318]]
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------
\10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2011-28828 Filed 11-7-11; 8:45 am]
BILLING CODE 8011-01-P