Self-Regulatory Organizations; New York Stock Exchange Inc. (n/k/a New York Stock Exchange LLC); Notice of Filing of Proposed Rule Change Relating to Amendments to Exchange Rule 611, “Disqualification or Other Disability of Arbitrators”

Table of Contents

July 27, 2006.

Pursuant to Section 19(b)(1) [1] of the Securities Exchange Act of 1934 (“Act”), [2] and Rule 19b-4 thereunder, notice is hereby given that on October 12, 2004, the New York Stock Exchange Inc. (n/k/a New York Stock Exchange LLC) (“NYSE” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed amendments to its arbitration rules as described in Items I and II below, which items have been prepared by the Exchange. On May 26, 2006, the Exchange filed Amendment No. 1 to the proposed rule change (“Amendment No. 1”). [3] The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

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

The proposed rule change, as amended, consists of amendments to Rule 611 concerning the disqualification of arbitrators.

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 Exchange 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 the proposed rule change is available on the NYSE's Web site (www.NYSE.com), at the NYSE's principal office, and at the Commission's Public Reference Room. The Exchange 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

Once an arbitrator has taken the Oath of Arbitrators for a particular case, NYSE rules do not currently provide for the Director of Arbitration to remove an arbitrator from serving on that case. The need for such action could arise if, for example, an item that should have been disclosed by the arbitrator pursuant to Exchange rules had inadvertently not been disclosed or a conflict arises after commencement of the hearing. Historically, when this situation has arisen, the remedy has been for the arbitrator to recuse himself or herself. Nevertheless, the Exchange believes that it would be prudent to give the Director of Arbitration the authority to remove an arbitrator should a conflict come to the attention of the parties or the Exchange that for whatever reason was not appropriately disclosed pursuant to NYSE rules.

2. Statutory Basis

The Exchange believes that the proposed rule change, as amended, is consistent with Section 6(b)(5) [4] of the Act in that it promotes just and equitable principles of trade by ensuring that members and member organizations and the public have a fair and impartialforum for the resolution of their disputes.

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.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as amended, is consistent with the Act. We solicit specific comment on whether the language of the proposed rule, as amended, clearly indicates that conflicts arising after the commencement of the hearing could give rise to removal of an arbitrator by the Director of Arbitration. 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-NYSE-2004-56 on the subject line.

Paper Comments

• Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSE-2004-56. 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 inspection and copying in the Commission's Public Reference Room. Copies of such filing also will be available for inspection and copying at the principal office of the NYSE. 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 Number SR-NYSE-2004-56 and should be submitted on or before August 28, 2006.

For the Commission, by the Division of Market Regulation, pursuant to delegated authority. [5]

Nancy M. Morris,

Secretary.

Footnotes

1. 15 U.S.C. 78s(b)(1).

2. 15 U.S.C. 78a.

3. In Amendment No. 1, the Exchange amended the filing to note that the need to remove an arbitrator might arise not only for a failure to disclose an item that should have been disclosed, but also if a conflict arises after the commencement of the hearing. The Exchange also amended the filing and the rule text to remove the Director of Arbitration's discretion to limit the additional information requested of an arbitrator.

4. 15 U.S.C. 78f(b)(5).

5. 17 CFR 200.30-3(a)(12).

References

Loading most recent entriesloading

Feedback