
[Federal Register Volume 77, Number 67 (Friday, April 6, 2012)]
[Notices]
[Pages 20869-20870]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-8260]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66710; File No. SR-NYSEAMEX-2012-12]


Self-Regulatory Organizations; NYSE Amex LLC; Order Approving a 
Proposed Rule Change Amending the NYSE Amex Equities Definition of 
Approved Person To Exclude Foreign Affiliates, Eliminating the 
Application Process for Approved Persons, and Making Related Technical 
and Conforming Changes

April 2, 2012.

I. Introduction

    On February 14, 2012, NYSE Amex LLC (the ``Exchange'' or ``NYSE 
Amex'') filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) \1\ of the Securities 
Exchange Act of 1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ a 
proposed rule change to amend the NYSE Amex Equities definition of 
approved person to exclude foreign affiliates, eliminate the 
application process for approved persons, and make related technical 
and conforming changes. The proposed rule change was published for 
comment in the Federal Register on March 1, 2012.\4\ The Commission 
received no comments on the proposal. This order approves the proposed 
rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a et seq.
    \3\ 17 CFR 240.19b-4.
    \4\ See Securities Exchange Act Release No. 66463 (February 24, 
2012), 77 FR 12637 (March 1, 2012) (``Notice'').
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II. Description of the Proposed Rule Change

    The Exchange proposed to amend the NYSE Amex Equities definition of 
``approved person'' to exclude foreign affiliates, eliminate the 
application process for approved persons, and make related technical 
and conforming changes.
    The Exchange proposed to amend the definition of approved person in 
NYSE Amex Equities Rule 2 to revise the definition of which entities 
are deemed to be under ``common control'' with a member organization. 
The Exchange proposed to amend the definition of approved person so 
that it would include any person, other than a member, principal 
executive or employee of a member organization, who controls a member 
organization, is engaged in a securities or kindred business that is 
controlled by a member or member organization, or is a U.S. registered 
broker-dealer under common control with a member organization.
    The Exchange proposed several additional amendments to its Rules. 
The Exchange proposed to amend NYSE Amex Equities Rule 22 to provide 
that a member of certain NYSE boards and committees may not participate 
in the consideration of any matter if there are certain types of 
indebtedness between the board or committee member and a member 
organization's affiliate or other related parties. The Exchange 
proposed to amend NYSE Amex Equities Rule 98A, which provides that no 
issuer, or partner or subsidiary thereof, may become an approved person 
of a Designated Market Maker (``DMM'') unit that is registered in the 
stock of that issuer, to provide instead that a DMM unit may not be 
registered in a stock of an issuer, or a partner or subsidiary thereof, 
if such entity is either an approved person or an affiliate of the DMM 
unit's member organization. The Exchange proposed to amend 
Supplementary Material .30(c) of Rule 402 to provide that when 
securities are callable in part under the Rule, a member organization 
may not allocate any called securities to the account of an affiliate 
until all customer positions have been satisfied.
    The Exchange also proposed to amend its rules to remove the 
requirement that the Exchange affirmatively approve each application to 
become an approved person, and accordingly, to remove all references to 
an approval process and the submission of an application for such 
approval from NYSE Amex Equities Rules 304, 308, and 311. The Exchange 
also proposed to eliminate use of the Forms AP-1 and AD-G.
    The Exchange proposed to amend NYSE Amex Equities Rule 304 to 
provide specifically that a member organization would be required to 
identify all of its approved persons to the Exchange and each such 
approved person would continue to be required to consent to the 
Exchange's jurisdiction. The Exchange also proposed to make technical 
and conforming changes to other rules that reference the approved 
person application process.

III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange. In 
particular, the Commission finds that the proposed rule change is 
consistent with Section 6(b) \5\ of the Act, in general, and furthers 
the objectives of Section 6(b)(5) \6\ in particular in that it 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 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 Exchange noted that the 
proposed approved person definition and consent to jurisdiction process 
would remove unnecessary complexities and excessive informational 
requirements and create a more efficient and less burdensome process 
for membership applicants and member organizations while maintaining 
appropriate regulatory standards.\7\ As such, the Exchange believes 
that the proposed rule change would contribute to removing impediments 
to and perfecting the mechanism of a free and open market and a 
national market system.\8\ The Commission believes that the proposed 
rule change is consistent with the Exchange Act and should reduce the 
burdens on Exchange members while preserving the Exchange's 
jurisdiction over approved persons and maintaining appropriate controls 
over approved persons.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ Notice, 77 FR at 12639.
    \8\ Id.
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    The Commission has reviewed the record for the proposed rule change 
and believes that the record does not contain any information to 
indicate that the proposed rule would have a significant effect on 
efficiency, competition, or capital formation. In light of the record, 
the Commission has considered the proposed rule's impact on efficiency, 
competition, and capital formation and has concluded that the proposed 
rule is unlikely to have any significant effect.\9\
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    \9\ 15 U.S.C. 78c(f).

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[[Page 20870]]

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\10\ that the proposed rule change (SR-NYSEAMEX-2012-12) be, and it 
hereby is, approved.
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    \10\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2012-8260 Filed 4-5-12; 8:45 am]
BILLING CODE 8011-01-P


