[Federal Register Volume 64, Number 188 (Wednesday, September 29, 1999)]
[Notices]
[Pages 52565-52566]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-25282]
[[Page 52565]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-41886; File No. SR-NYSE-99-36]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the New York Stock Exchange, Inc. To Eliminate the Series 7B
Qualification Examination and Adopt a New Interpretation to Rule 345
(``Employees--Registration, Approval, Records'')
September 20, 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 August 31, 1999, the New York Stock Exchange, Inc. (``NYSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items II and III below, which Items have been prepared by the Exchange.
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.
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The NYSE proposes to amend the interpretation of its Rule 345.15
(``Employees--Registration, Approval, Records'') \3\ by eliminating the
Series 7B Qualification Examination and establishing the Series 7A
Examination as the appropriate qualification examination for Exchange
Floor clerks who wish to conduct a limited public business with
professional customers. The proposed amendment would establish the
Trading Assistant Examination (``Series 25'') as a prerequisite for the
Series 7A Examination. The text of the proposed rule change is
available at the NYSE, and at the Commission.
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\3\ The interpretation to Rule 345.15 is contained in the NYSE
Interpretation Handbook.
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II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the NYSE 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. The NYSE 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
Currently, Floor clerks who want to conduct a limited public
business with professional customers (e.g., banks, insurance companies,
and other persons included in the definition of ``professional
customer'' found in the written interpretation to Exchange Rule 345.15)
must first pass the Series 7B Examination or the General Securities
Representative (``Series 7'') Examination. Floor members who want to
conduct a securities business with professional customers must first
pass the Series 7A Examination or the Series 7 Examination.
The Series 7A and Series 7B qualification examinations were
implemented in 1993 \4\ and 1994 \5\ respectively to serve as
alternative qualification exams to the Series 7 Examination because the
level of knowledge required to conduct a professional public business
limited to transactions in listed securities on the Exchange Floor is
narrower than that needed to conduct a general public business with
retail customers.
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\4\ See Securities Exchange Act Release No. 32698 (July 29,
1993), 58 FR 41539 (August 4, 1993).
\5\ See Securities Exchange Act Release No. 34334 (July 8,
1994), 59 FR 35964 (July 14, 1994).
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The Series 7A and Series 7B Examinations are identical except for
an additional 25 questions on the Series 7B which address Exchange
Floor rules and policies. The additional 25 questions were added to
ensure that Floor clerks have a basic understanding of Exchange trading
rules and the underlying principles of the auction market. However, the
recently implemented NYSE Trading Assistant Examination (``Series 25'')
\6\ now serves this purpose, and serves it more effectively because of
its broader topic coverage and greater length.
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\6\ See Securities Exchange Act Release No. 40943 (January 13,
1999), 64 FR 3330 (January 21, 1999).
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Given that Floor clerks are currently required to take and pass the
Series 25, candidates are tested twice on certain topics. Therefore, it
is proposed that the Series 7B Examination be eliminated. In addition,
it is proposed that the written interpretation to Rule 345.15 be
amended to establish the Series 7A Examination as the appropriate
qualification examination for both Floor members and Floor clerks who
wish to conduct a limited public business with professional customers.
Further, it is proposed that the interpretation be amended to
establish the Series 25 Examination as a prerequisite for Floor clerks
seeking to take the Series 7A Examination. The Series 15 Examination
remains a prerequisite to the Series 7A Examination for Floor members.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the requirements of Section 6(c)(3)(B) of the Act.\7\ Under that
Section, it is the Exchange's responsibility to prescribe standards of
training, experience and competence for persons associated with
Exchange members and member organizations.
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\7\ 15 U.S.C. 78f(c)(3)(B).
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In addition, under Section 6(c)(3)(B) of the Act,\8\ the Exchange
may bar a natural person from becoming a member or person associated
with a member, if such natural person does not meet such standards of
training, experience and competence as are prescribed by the rules of
the Exchange.
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\8\ Id.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose 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
The Exchange has neither solicited nor received written comments on
the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
A. By order approve the proposed rule change, or
B. Institute proceedings to determine whether the proposed rule
change should be disapproved.
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IV. 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. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 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 at the
Commission's Public Reference Room, located at the above address.
Copies of such filing will also be available for inspection and copying
at the principal office of the Exchange. All submissions should refer
to File No. SR-NYSE-99-36 and should be submitted by October 20, 1999.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-25282 Filed 9-28-99; 8:45 am]
BILLING CODE 8010-01-M
