99-30980. Self-Regulatory Organizations; Order Approving Proposed Rule Change by the New York Stock Exchange, Inc. To Amend Exchange Rule 22(b)

[Federal Register Volume 64, Number 229 (Tuesday, November 30, 1999)]
[Notices]
[Page 66957]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-30980]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42162; File No. SR-NYSE-99-32]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by the New York Stock Exchange, Inc. To Amend Exchange Rule 
22(b)

November 19, 1999.

I. Introduction

    On July 9, 1999, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange'') submitted to the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 \2\ thereunder, a 
proposed rule change. In its proposal, the NYSE seeks to codify an 
interpretation of a section of its Disqualification Because of Personal 
Interest Rule.\3\ The proposed rule change was published for comment in 
the Federal Register on September 21, 1999.\4\ The Commission received 
no comments on the proposal. This order approves the proposal.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Exchange Rule 22(b).
    \4\ See Securities Exchange Act Release No. 41871 (September 13, 
1999), 64 FR 51170.
---------------------------------------------------------------------------

II. Description of the Proposal

    The NYSE seeks to codify an interpretation of Exchange Rule 22(b), 
which addresses circumstances under which Board and committee members 
and other persons are obliged to disqualify themselves from 
participating in matters in which they have a personal interest. 
Exchange Rule 22(b) currently states that no person(s) shall 
participate in the ``adjudication'' of any matter in which they are 
personally interested. The proposed amendment to this rule would bar 
person(s) from participating in the ``consideration, review or 
adjudication'' of any matter in which they are personally interested.

III. Discussion

    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act.\5\ In 
particular, the Commission finds the proposal is consistent with 
Section 6(b)(5) \6\ of the Act. Section 6(b)(5) requires, among other 
things, that the rules of an exchange be designed to promote just and 
equitable principles of trade and to protect investors and the public 
interest.
---------------------------------------------------------------------------

    \5\ In addition, pursuant to Section 3(f) of the Act, the 
Commission has considered the proposed rule's impact on efficiency, 
competition, and capital formation. 15 U.S.C. 78c(f).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Commission finds that the proposed rule change is consistent 
with the Act in that the change promotes fairness and impartiality in 
the operation and oversight of the NYSE. The proposal codifies an 
interpretation of Exchange Rule 22(b). This rule prevents persons with 
conflicts of interests from participating in matters in which they have 
a personal interest. The Commission believes the amendment clarifies 
those situations in which a person with a conflict of interest should 
disqualify himself.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\7\ that the proposed rule change (SR-NYSE-99-32) is approved.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(2).

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

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

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-30980 Filed 11-29-99; 8:45 am]
BILLING CODE 8010-01-M