[Federal Register: December 27, 2002 (Volume 67, Number 249)]
[Notices]
[Page 79205-79210]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27de02-164]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-47056; File No. SR-NASD-2002-176]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by National Association of
Securities Dealers, Inc. and Renewal on Pilot Basis of NASD Rule
7010(k) Relating to Fees for the Trade Reporting and Compliance Engine
(TRACE)
December 19, 2002.
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 December 13, 2002, the National Association of Securities Dealers,
Inc. (``NASD''), filed with the Securities and Exchange Commission
(``Commission'' or ``SEC'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by NASD.
NASD has designated the proposed rule change as ``establishing or
changing a due, fee, or other charge'' under Section 19(b)(3)(A)(ii) of
the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\ which renders the
proposal effective upon filing with the Commission. The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
NASD is proposing to amend NASD Rule 7010(k) relating to fees for
the Trade Reporting and Compliance Engine (``TRACE'') prior to the
expiration of the pilot program for fees on December 28, 2002. NASD is
proposing to extend the pilot program for TRACE fees to February 28,
2003 and to modify the pilot effective January 1, 2003. As a result of
the proposed rule change, the current fee structure would remain in
effect to December 31, 2002. In addition, NASD is proposing technical
revisions to Rule 7010(k) to replace references to
[[Page 79206]]
``the Association'' with ``NASD.'' Below is the text of the proposed
rule change. Proposed new language is underlined; proposed deletions
are in brackets.
* * * * *
7010. System Services
(k) Trade Reporting and Compliance Engine (TRACE)
(Rule 7010(k) shall expire on [December 28, 2002] February 28,
2003, unless amended, extended, or permanently adopted by NASD pursuant
to SEC approval at or before such date).
The following charges shall be paid by participants for the use of
the Trade Reporting and Compliance Engine (``TRACE''):
------------------------------------------------------------------------
Transaction
System fees reporting fees Market data fees
------------------------------------------------------------------------
From 07/01/02 to 12/31/02: Web From 07/01/02 to 12/ BTDS Professional
Browser Access: $85/month for 31/02: Trades up Display--$60/
1 user IDs; $75/month for 2-9 to and including month per
user IDs; $70/month for 2-10+ $200,000 par terminal
user IDs, except. value--$0.50/
If less than 25 trades per trade;
month, in October, November, Trades between
or December 2002--$25/month $201,000 and
per user ID. $999,999 par
value--$0.0025
times the number
of bonds traded/
trade;
Trades of
$1,000,000 par
value or more--
$2.50/trade
From 01/01/03 to 02/28/03: From 01/01/03 to 02/
Level I Trade Report Only Web 28/03:
Browser Access--$25/month per Trades up to and
user ID Level II Full Service including $200,000
Web Browser Access--$85/month par value--$0.475/
per user ID. trade;
Trades between
$201,000 and
$999,999 par
value--$0.002375
times the number
of bonds traded/
trade;
Trades of
$1,000,000 par
value or more--
$2.375/trade
CTCI--$25/month/line........... From 07/01/02 to 12/ BTDS Internal
31/02: Cancel/ Usage
Correct--$3/trade, Authorization--$5
except 00/month per
For October 2002-- organziation
$1.50/trade
For November 2002--
$2.25/trade
From 01/01/03 to 02/
28/03: Cancel/
Correct--$1.50/
trade
Third Party--$25/month......... From 07/01/02 to 12/ BTDS External
31/02: ``As of'' Usage
Trade Late--$3/ Authorization--$1
trade, except ,000/month per
For October 2002-- organization
$1.50/trade
For November 2002--
$2.25/trade
From 01/01/03 to 02/
28/03: ``As of''
Trade Late--$3/
trade
From 07/01/02 to 12/31/02: PDN Browse & Query-- BTDS Non-
Administrative--$100/month/ $0.05 after first Professional
line. page Display--$1/month
As of 01/01/03: PDN service and per terminal
corresponding fee eliminated.
................... From 07/01/02 to
12/31/02: Daily
List Fax-- $15/
month per fax
number/addressee
As of 01/01/03:
Daily List Fax
service and
corresponding fee
eliminated
From 07/01/02 to 12/31/02: PDN Browse & Query-- BTDS Non-
Administrative--$100/month/ $0.05 after first Professional
line. page Display--$1/month
As of 01/01.03: PDN service and per terminal
corresponding fee eliminated.
................... From 07/01/02 to
12/31/02: Daily
List Fax-- $15/
month per fax
number/addressee
As of 01/01/03:
Daily List Fax
service and
corresponding fee
eliminated
------------------------------------------------------------------------
(1) System Related Fees. There are three methods by which a member
may report corporate bond transactions that are reportable to NASD
pursuant to the Rule 6200 Series. A member may choose among the
following methods to report data to NASD: (a) a TRACE web browser
(either over the Internet or a secure private data network (``PDN''));
(b) a Computer-to-Computer Interface (``CTCI'') (either one dedicated
solely to TRACE or a multi-purpose line); or (c) a third-party
reporting intermediary. Fees will be charged based on the reporting
methodology selected by the member.
(A) Web Browser Access
(i) For the period commencing July 1, 2002 and ending December 31,
2002, [T]the charge to be paid by a member that elects to report TRACE
data to NASD via a TRACE web browser shall be as follows: for the first
user ID registered, a charge of $85 per month; for the next two through
nine user IDs registered, a charge of $75 per month, per such
additional user ID; and for ten or more user IDs registered, a charge
of $70 per month, per user ID from two to ten or more. If a member
reports less than 25 trades per month to the TRACE system in October,
November, or December 2002, the charge to be paid by a member for the
TRACE web browser shall be $25, per such month, per user ID.
(ii) For the period commencing January 1, 2003 and ending February
28, 2003, the charge to be paid by a member that elects to report TRACE
data to NASD via a TRACE web browser shall be as follows: $25 per
month, per user ID for Level I Trade Report Only Web Browser Access and
$85 per month, per user ID for Level II Full Service Web Browser
Access.
(iii) [In addition, a] A member that elects to report TRACE data to
NASD [the Association] via a web browser over a secure PDN rather than
over the Internet shall pay an additional administrative charge of $100
per
[[Page 79207]]
month, per line.\5\ As of January 1, 2003, PDN service and the
corresponding fee shall be eliminated.
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\5\ Charges that may be imposed by third parties, such as
network providers, are not included in these fees.
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(B) Computer-to-Computer Interface Access
The charge to be paid by a member that elects to report TRACE data
to NASD [the Association] via a CTCI line shall be $25 per month, per
line, regardless of whether the line is or is not dedicated exclusively
for TRACE.\6\
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\6\ Charges that may be imposed by third parties, such as CTCI
providers, are not included in these fees.
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(C) Third Party Access--Indirect Reporting
A member may elect to report TRACE data indirectly to NASD [the
Association] via third-party reporting intermediaries, such as vendors,
service bureaus, clearing firms, or the National Securities Clearing
Corporation (``NSCC''). The charge to be paid by a member shall be $25
per month, per firm. Nothing in this Rule shall prevent such third-
party intermediaries from charging additional fees for their services.
(2) Transaction Reporting Fees. For each transaction in corporate
bonds that is reportable to NASD pursuant to the Rule 6200 Series, the
following charges shall be assessed against the member responsible for
reporting the transaction:
(A) Trade Reporting Fee
(i) For the period commencing July 1, 2002 and ending December 31,
2002, [A] a member shall be charged a Trade Reporting Fee based upon a
sliding scale ranging from $0.50 to $2.50 per transaction based on the
size of the reported transaction. Trades up to and including $200,000
par value will be charged a $0.50 fee per trade; trades between
$201,000 par value and $999,999 par value will be charged a fee of
$0.0025 multiplied by the number of bonds traded per trade; and trades
of $1,000,000 par value or more will be charged a fee of $2.50 per
trade.
(ii) For the period commencing January 1, 2003 and ending February
28, 2003, a member shall be charged a Trade Reporting Fee based upon a
sliding scale ranging from $0.475 to $2.375 per transaction based on
the size of the reported transaction. Trades up to and including
$200,000 par value will be charged a $0.475 fee per trade; trades
between $201,000 par value and $999,999 par value will be charged a fee
of $0.002375 multiplied by the number of bonds traded per trade; and
trades of $1,000,000 par value or more will be charged a fee of $2.375
per trade.
(B) Cancel or Correct Trade Fee
For the period commencing July 1, 2002 and ending December 31,
2002, [A] a member shall be charged a Cancel or Correct Trade Fee of
$3.00 per canceled or corrected transaction. To provide firms with time
to adjust to the new reporting system, the Cancel or Correct Trade Fee
will not be charged until the later of October 1, 2002 or 90 days after
the effective date of TRACE. For the month of October 2002, the Cancel
or Correct Trade Fee shall be $1.50 per canceled or corrected
transaction. For the month of November 2002, the Cancel or Correct
Trade Fee shall be $2.25 per canceled or corrected transaction. For the
period commencing January 1, 2003 and ending February 28, 2003, a
member shall be charged a Cancel or Correct Trade Fee of $1.50 per
canceled or corrected transaction.
(C) ``As of'' Trade Late Fee
For the period commencing July 1, 2002 and ending December 31,
2002, [A] a member shall be charged an ``As of'' Trade Late Fee of
$3.00 per transaction for those transactions that are not timely
reported ``As of'' as required by these rules. To provide firms with
time to adjust to the new reporting system, the ``As of'' Trade Late
Fee will not be charged until the later of October 1, 2002 or 90 days
after the effective date of TRACE. For the month of October 2002, the
``As of'' Trade Late Fee shall be $1.50 per such transaction. For the
month of November 2002, the ``As of'' Trade Late Fee shall be $2.25 per
such transaction. For the period commencing January 1, 2003 and ending
February 28, 2003, a member shall be charged an ``As of'' Trade Late
Fee of $3.00 per canceled or corrected transaction.
(D) Browse and Query Fee
Members may review their own previously reported transaction data
through a Browse and Query function. A member shall be charged $0.05
for each returned page of the query beyond the first page.
(3) Market Data Fees. Professionals and non-professionals may
subscribe to receive real-time TRACE data disseminated by NASD [the
Association] in one or more of the following ways for the charges
specified. Members, vendors and other redistributors shall be required
to execute appropriate agreements with NASD [the Association].
(A) Professional Fees
Professionals may subscribe for the following:
(i) Bond Trade Dissemination Service (``BTDS'') Professional
Display Fee of $60 per month, per terminal charge for each
interrogation or display device receiving real-time TRACE transaction
data.
(ii) BTDS Internal Usage Authorization Fee of $500 per month, per
organization charge for internal dissemination of real-time TRACE
transaction data used in one or more of the following ways: internal
operational and processing systems, internal monitoring and
surveillance systems, internal price validation, internal portfolio
valuation services, internal analytical programs leading to purchase/
sale or other trading decisions, and other related activities.\7\
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\7\ Under this service, real-time TRACE transaction data may not
be used in any interrogation display devices, any systems that
permit end users to determine individual transaction pricing in
real-time, or disseminated to any external source.
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(iii) BTDS External Usage Authorization Fee of $1,000 per month,
per organization charge for dissemination of real-time TRACE
transaction data used in one or more of the following ways: repackaging
of market data for delivery and dissemination outside the organization,
such as indices or other derivative products.\8\
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\8\ Under this service, real-time TRACE transaction data may not
be used in any interrogation display devices, any systems that
permit end users to determine individual transaction pricing in
real-time.
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(B) Non-Professional Fees
The charge to be paid by a non-professional for each terminal
receiving all or any portion of real-time TRACE transaction data
disseminated through TRACE shall be $1.00 per month, per terminal.
(C) Non-Professional Defined
A ``non-professional'' is a natural person who is neither:
(i) registered nor qualified in any capacity with the Commission,
the Commodity Futures Trading Commission, any state securities agency,
any securities exchange or association, or any commodities or futures
contract market or association; or
(ii) engaged as an ``investment adviser'' as that term is defined
in Section 202(a)(11) of the Investment Advisers Act of 1940 (whether
or not registered or qualified under that Act);
(iii) employed by a bank, insurance company or other organization
exempt
[[Page 79208]]
from registration under federal or state securities laws to perform
functions that would require registration or qualification if such
functions were performed for an organization not so exempt; nor
(iv) engaged in, or has the intention to engage in, any
redistribution of all or any portion of the information disseminated
through TRACE.
(4) Daily List Fax Service. Each subscriber for NASD's [the
Association's] Daily List Fax Service shall be charged $15 per month,
per fax number/addressee. As of January 1, 2003, Daily List Fax service
and the corresponding fee shall be eliminated.
* * * * *
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, 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. NASD has prepared summaries, set forth in Sections A, B,
and C below, of 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
On July 1, 2002, the Trade Reporting and Compliance Engine (TRACE)
became effective. On June 28, 2002, the Commission approved proposed
NASD fees relating to the operation of the TRACE system (Rule 7010(k))
on a pilot basis for a six-month period expiring on December 28,
2002.\9\ As part of that rule filing (Amendment No. 3 to SR-NASD-2002-
63), NASD committed to review and reassess the proposed TRACE fees as
soon as practicable and within six months after the effective date of
TRACE, based on such factors as actual volume, usage, costs, and
revenues.
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\9\ The Commission approved Rule 7010(k) relating to TRACE fees
on June 28, 2002 on a six-month pilot basis. See Securities Exchange
Act Release No. 46145 (June 28, 2002), 67 FR 44911 (July 5, 2002)
(File No. SR-NASD-2002-63).
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On November 15, 2002, NASD submitted a proposed rule change to the
SEC to reduce certain TRACE fees for the fourth quarter of 2002 (i.e.,
the Web Browser Access Fee, the Cancel or Correct Fee, and the ``As
of'' Trade Late Fee). These fees were reduced effective as of October
1, 2002.\10\
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\10\ See Securities Exchange Act Release No. 46893 (November 22,
2002), 67 FR 72008 (December 3, 2002) (Notice of Filing and
Immediate Effectiveness of SR-NASD-2002-167).
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Review by NASD staff of the impact of the original fee structure
indicates that a continuation of these fees in 2003 could potentially
result in a significant financial burden to many firms. NASD is
therefore proposing to extend the pilot program for TRACE fees to
February 28, 2003 and to modify the pilot effective January 1, 2003. As
a result of the proposed rule change, the current fee structure would
remain in effect to December 31, 2002. NASD believes the proposed rule
change will more equitably distribute the costs to participants of the
TRACE system.
The current TRACE fee structure is divided into three general
categories: system related fees, transaction reporting fees, and market
data fees. After carefully reviewing the data collected to date, NASD
staff is proposing to revise the current fee structure for TRACE as
described below.
Proposed Amendments to Web Browser Access Fees
Under the TRACE rules, a member may report TRACE transaction data
to NASD by one of three approved methods: (1) Web browser access; (2)
direct computer-to-computer interface (``CTCI''); or (3) indirectly
through third-parties, such as vendors, service bureaus, clearing
firms, or the National Securities Clearing Corporation. Many small
participants have registered to report TRACE transaction data to NASD
through the web browser because the alternative methods are either not
cost effective for them or not viable for their methods of processing
data.
Following the effective date of TRACE, NASD staff received
complaints from certain small firms regarding the burden of paying the
Web Browser Access Fee. These firms complained that the small number of
TRACE transactions that they handle and, therefore, are required to
report on a monthly basis are not in line with the $85 per month cost
for one web browser.
The current Web Browser Access Fee for each registered participant
is: $85 per month for the first user ID; $75 per month for the second
through ninth user ID; and $70 per month for the second through tenth
or more user ID, if the participant registers ten or more user IDs. For
the fourth quarter of 2002, the Web Browser Access Fee was reduced to
$25 per month, per user ID for participants that reported less than 25
transactions during the months of October, November, and December 2002.
The current web browser permits the reporting of transactions into the
TRACE system, and, through the use of a query feature, allows
participants access to TRACE transactions and real-time TRACE market
data. At the time this service was established (and the fees
determined), NASD did not have the capability to separate the real-time
market data access feature from the web browser. As a result, the
current web browser access fees were largely established based on the
cost of including the real-time market data access feature to
participants that elected to report TRACE transactions through the web
browser.
Since that time, NASD staff has developed the capability to
separate real-time market data access feature from the web browser.
Commencing January 1, 2003, NASD is proposing that the Web Browser
Access Fee be divided into two service levels--Level I with no access
to real-time TRACE data, and Level II with access to real-time TRACE
data.
A participant who registers for Level II Full Service Web Browser
Access will be able to report TRACE data to NASD over the Internet and
to use a query feature to receive real-time TRACE transaction data.
Level II Full Service Web Browser Access Fee will be $85 per month, per
user ID and will replace the current graduated fee structure. A
participant who registers for Level I Trade Report Only Web Browser
Access will be able to report TRACE data to NASD over the Internet.
Level I access will not allow a participant to receive real-time TRACE
transaction data. The proposed fee for Level I Trade Report Only Web
Browser Access is $25 per month, per user ID. A participant may
subscribe for a combination of Level I and Level II service based on
usage and need.
The charge for the Level II Full Service Web Browser Access
includes the cost of developing and providing real-time TRACE data
access through the web browser. In addition, NASD is proposing to
eliminate the multi-browser discount. While this may result in a small
increase in costs for firms that use multiple copies of the browser
with market data access, NASD staff believes the flat fee treats all
firms equitably and may allow firms to achieve overall cost savings by
subscribing to Level I Trade Report Only Web Browser Access, instead of
Level II Full Service Web Browser Access, for those users who do not
require real-time TRACE data access.
[[Page 79209]]
Proposed Amendments to Trade Reporting Fees
The current Trade Reporting Fees are based on a sliding scale that
ranges from $0.50 to $2.50 per transaction based on the size of the
reported transaction. Trades up to and including $200,000 par value are
charged a $0.50 fee per trade; trades between $201,000 par value and
$999,999 par value are charged a fee of $0.0025 multiplied by the
number of bonds traded; and trades of $1,000,000 par value or more are
charged a fee of $2.50 per trade.
Following the operation of TRACE, NASD staff has been collecting
data on trade reporting fees incurred by participants. The revenues
generated by this fee have been higher than originally forecasted. As a
result, NASD is proposing that trade reporting fees be reduced by 5%
for 2003. The Trade Reporting Fee will continue to be based on a
sliding scale, but the range will be from $0.475 to $2.375 per
transaction based on the size of the reported transaction. Trades up to
and including $200,000 par value will be charged a $0.475 fee per
trade; trades between $201,000 par value and $999,999 par value will be
charged a fee of $0.002375 multiplied by the number of bonds traded,
and trades of $1,000,000 par value or more will be charged a fee of
$2.375 per trade.
Proposed Amendments to Cancel or Correct Fees
Cancel, correct, and ``As of'' transactions are used by
participants to modify original trade entries. While a certain level of
corrective transactions will always be necessary, NASD staff believes
it is very important that trades be entered into the system correctly
the first time to ensure that data disseminated through the TRACE
system is accurate and to allow investors to rely on the data stream
they receive. Further, the volume of corrective transactions will
increase NASD's technology costs.
In the original fee proposal, NASD delayed the effectiveness of the
Cancel or Correct Fee and the ``As of'' Late Fee to October 1, 2002.
Based on NASD staff review of the data collected on such fees after the
first three months of TRACE operation, on November 15, 2002, NASD
submitted a proposed rule change to the SEC to phase in the
implementation of the two fees during the last quarter of 2002 to allow
participants greater time to adjust to the new system and focus on
methods to reduce the likelihood of incurring such fees.\11\
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\11\ Id.
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The original charge for the Cancel or Correct Fee and the ``As of''
Late Fee was $3.00 for each such reported trade. For the month of
October 2002, the Cancel or Correct Fee and the ``As of'' Late Fee
charge assessed to each participant were reduced from $3.00 per trade
to $1.50 per trade (a 50% discount), and for the month of November
2002, the Cancel or Correct Fee and the ``As of'' Late Fee were reduced
from $3.00 per trade to $2.25 per trade (a 25% discount).
Based on further NASD staff analysis, the number of cancel and
correct transactions submitted continues to be high. NASD staff has
been contacting participants to review their systems and reporting
methodologies to reduce erroneous reporting by participants. NASD staff
still believes that over time the number of corrective transactions
submitted to the system will decline. However, NASD believes that fees
for corrective transactions are necessary to discourage erroneous
reporting and to improve the integrity of disseminated data. Therefore,
NASD is proposing that the Cancel or Correct Fee be reduced from $3.00
to $1.50 effective January 1, 2003. The ``As of'' Trade Late Fee will
remain at $3.00 per trade.
Proposed Amendment to Eliminate PDN Administrative Fee
In the original fee proposal, NASD had provided users the option of
reporting TRACE data through the web browser over a secure private data
network rather than over the Internet. The cost of this additional
service is $100 per month, per line. No users have subscribed to this
service and, as a result, NASD is proposing that this service and the
corresponding fee be eliminated effective January 1, 2003.
Proposed Amendment to Eliminate Daily List Fax Service
In the original fee proposal, NASD had provided for a daily list
fax service that would provide subscribers with daily additions,
deletions, and modifications to the list of TRACE-eligible securities.
The charge for this service is $15 per month, per fax number/addressee.
To date, one user has subscribed for this service and it is not cost
effective for NASD to continue providing the service. As a result, NASD
is proposing that this service and the corresponding fee be eliminated
effective January 1, 2003.
Extension and/or Renewal of Pilot Program for TRACE Fees
NASD is proposing to extend and/or renew the pilot program for
TRACE fees that is scheduled to expire on December 28, 2002 to expire
on February 28, 2003. Further, NASD expects to submit a rule filing to
the SEC prior to the February 28, 2003 expiration date seeking approval
of a permanent fee structure for TRACE. NASD believes that the proposed
fee structure for TRACE is reasonable, however, NASD is committed to an
ongoing review and reassessment of TRACE fees during 2003. Based on
data collected during 2003, NASD expects to recommend additional
changes to the TRACE fee structure to ensure that the TRACE fees are
reasonable.
NASD will continue to review and reassess the impact of the overall
TRACE fee structure over time to ensure that the fees are reasonable
and equitable for participants in the TRACE system.
2. Statutory Basis
NASD believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(5) of the Act,\12\ which requires, among
other things, that NASD's rules provide for the equitable allocation of
reasonable dues, fees, and other charges among members and issuers and
other persons using any facility or system which NASD operates or
controls. NASD is proposing to extend the pilot program for TRACE fees
to February 28, 2003 and to modify the pilot effective January 1, 2003.
As a result of the proposed rule change, the current fee structure
would remain in effect to December 31, 2002. NASD believes that such
proposed rule change will more equitably allocate fees to NASD members
during the early stages of implementing TRACE.
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\12\ 15 U.S.C. 78o-3(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
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. 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.
[[Page 79210]]
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The proposed rule change is effective pursuant to Section
19(b)(3)(A)(ii) of the Act \13\ and Rule 19b-4(f)(2) thereunder,\14\
because the proposal is ``establishing or changing a due, fee, or other
charge.'' The rule change has become effective pursuant to Section
19(b)(3)(A) of the Act and Rule 19b-4(f)(2) thereunder, and will be
operational immediately as of the dates described in the proposed rule
change. The proposed rule change to replace references to ``the
Association'' with ``NASD'' is effective immediately pursuant to
Section 19(b)(3)(A)(iii),\15\ as it is concerned solely with the
administration of the self-regulatory organization.
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\13\ 15 U.S.C. 78s(b)(3)(A)(ii).
\14\ 17 CFR Sec. 240.19b-4(f)(2).
\15\ 15 U.S.C. 78s(b)(3)(A)(iii).
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At any time within 60 days of this filing, the Commission may
summarily abrogate this proposal 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.
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 20549-0609. 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 NASD. All submissions
should refer to file number SR-NASD-2002-176 and should be submitted by
January 17, 2003.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. 02-32734 Filed 12-26-02; 8:45 am]
BILLING CODE 8010-01-P