regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc.; correction,

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Federal Register: October 7, 1999 (Volume 64, Number 194)NoticesPage 54712-54713From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DOCID:fr07oc99-112

SECURITIES AND EXCHANGE COMMISSION

Release No. 34-41946; File No. SR-NASD-99-5Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the National Association of Securities Dealers, Inc. Clarifying Web CRD Policies

September 29, 1999.

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 September 24, 1999, the National Association of Securities Dealers, Inc. (``NASD'' or ``Association''), through its wholly owned subsidiary NASD Regulation, Inc. (``NASD Regulation'' or ``NASDR''), filedwith 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 NASD Regulation. NASDR has designated this proposal as new constituting a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule under Section 19(b)(3)(A) \3\ of the Act, 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.

\1\ 15 U.S.C. 78s(b)(1).

\2\ 17 CFR 240.19b-4.

\3\ 15 U.S.C. 78s(b)(3)(A).

I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

NASD Regulation proposes to clarify Forms U-4 and U-5.

II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change

In its filing with the Commission, NASDR 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. NASDR has prepared summaries, set forth in Sections A, B, and C below, for 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

The purpose of the proposed rule change is to clarify Forms U-4 and U-5. Members file Forms U-4 and U-5 electronically pursuant to NASD Rule 1140, with one exception. New member applicants file their initial Forms BD and U-4 on paper under NASD Rule 1013. Because the majority of the filings will be done electronically, NASDR has determined that mailing address for the Central Registration Depository (``CRD'') should be removed from the cover pages of Forms U-4 and U-5 to help eliminate any potential confusion among members about how to submit the Forms. NASDR has issued numerous communications to members about Web CRD and electronic filing requirements, and anticipates that members and new member applicants will comply with the rules and stated policies. NASDR will be submitting a separate rule filing further clarifying Rule 1013 and how new member applicants will be given access to Web CRD so that all amendments to their initial Forms BD and U-4 will be submitted electronically in compliance with Commission requirements.\4\

\4\ See Securities Exchange Act Release No. 41594 (July 2, 1999), 64 FR 37586 (July 12, 1999).

2. Statutory Basis

NASDR believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) \5\ of the

[Page 54713]Act, which requires, among other things, that the Association's 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. The proposed rule change clarifies certain practices with respect to Web CRD.

\5\ 15 U.S.C. 78o-3(b)(6).

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

NASDR 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

Because the foregoing rule change constitutes a stated policy, practice, or interpretation with respect to the meeting, administration, or enforcement of an existing rule, it has become effective pursuant to Section 19(b)(3)(A)(i) \6\ of the Act and subparagraph (f)(1) of Rule 19b-4 thereunder.\7\ 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.

\6\ 15 U.S.C. 78s(b)(3)(A)(i).

\7\ 17 CFR 240.19b-4(f)(1).

IV. Solicitation of Comments

Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including the proposed rule change 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 20549-0609. Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filedwith 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 at the Commission's Public Reference Room. Copies of such filing also will be available for inspection and copying at the principal office of the NASD. All submissions should refer to File No. SR-NASD-99-50 and should be submitted by October 28, 1999.

For the Commission, by the Division of Market Regulation, pursuant to delegated authority.\8\

\8\ 17 CFR 200.30-3(a)(12).

Jonathan G. Katz, Secretary.

FR Doc. 99-26160Filed10-6-99; 8:45 amBILLING CODE 8010-01-M

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