Self-Regulatory Organizations; Proposed Rule Changes:

Federal Register: March 8, 2011 (Volume 76, Number 45)

Notices

Page 12769-12771

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DOCID:fr08mr11-112

SECURITIES AND EXCHANGE COMMISSION

Release No. 34-64005; File No. SR-FINRA-2011-007

Self-Regulatory Organizations; Financial Industry Regulatory

Authority, Inc.; Notice of Filing and Immediate Effectiveness of

Proposed Rule Change Relating to Correct Cross-References in the

Customer Code

March 2, 2011.

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 February 16, 2011, the 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 substantially prepared by FINRA. FINRA has designated the proposed rule change as concerned solely with the administration of the self-regulatory organization under

Page 12770

Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(3) thereunder,\4\ 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)(iii).

\4\ 17 CFR 240.19b-4(f)(3).

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

   FINRA is proposing to amend various rules of the Code of

   Arbitration Procedure for Customer Disputes (Customer Code) to correct cross-references to rules that were changed by the approval of another rule filing.

   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.

2. 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.

   1. Self-Regulatory Organization's Statement of the Purpose of, and

      Statutory Basis for, the Proposed Rule Change 1. Purpose

      On January 31, 2011, the SEC approved a proposal to amend the panel composition rule, and related rules, of the Customer Code to provide customers with the option to choose an all public arbitration panel in all cases (Optional All Public Panel Proposal).\5\ The proposal changed substantively most of the rules in Part IV of the Customer Code to reflect the option to choose an all public arbitration panel in all cases. Further, many of the Part IV rules of the Customer Code were also re-numbered when some of the old rules were eliminated or combined with other rules. As a result of the changes by the proposal, several cross-references to old Part IV rules in other rules of the Customer

      Code became inaccurate.

      \5\ See Securities Exchange Act Release No. 63799 (Jan. 31, 2011), 76 FR 6500 (Feb. 4, 2011) (Order Approving File No. SR-FINRA- 2010-053).

      FINRA is, therefore, proposing to amend the Customer Code to correct the cross-references that were changed as a result of the

      Optional All Public Panel Proposal.\6\ The new proposal would amend

      Rules 12213(a), 12309(c), 12314, 12503(c), 12800(e), and 12903(a).

      FINRA has filed the proposed rule change for immediate effectiveness.

      The effective date and the implementation date will be the date of filing.

      \6\ Id.

      2. Statutory Basis

      FINRA believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,\7\ 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. FINRA believes that the proposed rule change will assist in the efficient administration of arbitrations by correcting inaccurate cross-references in the Customer Code. FINRA believes these technical, non-substantive amendments will enhance the Code by making it easier to understand and apply.

      \7\ 15 U.S.C. 78o-3(b)(6).

   2. 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.

   3. 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.

3. Date of Effectiveness of the Proposed Rule Change and Timing for

   Commission Action

   Because the foregoing proposed rule change is concerned solely with the administration of the self-regulatory organization, it has become effective pursuant to Section 19(b)(3)(A) of the Act \8\ and paragraph

   (f)(3) of Rule 19b-4 thereunder.\9\

   \8\ 15 U.S.C. 78s(b)(3)(A).

   \9\ 17 CFR 240.19b-4(f)(3).

   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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.

4. 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-FINRA-2011-007 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-FINRA-2011-007. 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 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

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   Number SR-FINRA-2011-007 and should be submitted on or before March 29, 2011.

   For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\10\

   \10\ 17 CFR 200.30-3(a)(12).

   Cathy H. Ahn,

   Deputy Secretary.

   FR Doc. 2011-5139 Filed 3-7-11; 8:45 am

   BILLING CODE 8011-01-P