Hearings on Regulation NMS
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-49408; File No. S7-10-04]
Agency: Securities and Exchange Commission.
Action: Notice of hearings.
Summary: On February 26, 2004, the Securities and Exchange Commission (the "Commission") approved for publication proposed Regulation NMS (the "Proposing Release"), which is designed to enhance and modernize the regulatory structure of the U.S. equity markets (Securities Exchange Act Release No. 34-49325). In connection with the Proposing Release, the Commission will hold public hearings to give the Commission the benefit of the views of interested members of the public regarding the issues raised and questions posed in the Proposing Release.
Dates: The initial public hearing will be held on April 1, 2004 in Washington, DC. A subsequent public hearing will be held on April 21, 2004 in New York, New York. The following information pertains to both hearings. The hearings will begin at 9:00 a.m. Both hearings will be broadcast live and access will be available via webcast on the Commission's website at http://www.sec.gov. Persons who wish to testify at either hearing must submit a written request to the Commission specifying the date on which they prefer to testify and, if they are flexible as to either date, to specify so in their request. The Commission must receive these requests on or before March 22, 2004. Persons requesting to testify must also submit three copies of their oral statements or a summary of their intended testimony to the Commission. The Commission must receive these submissions on or before March 26, 2004. Those who do not wish to appear at the hearings may submit written testimony on or before the end of the comment period for the Proposing Release, which is 75 days after publication of the Proposing Release in the Federal Register (May 24, 2004), for inclusion in the public comment file.
Addresses: The April 1, 2004 hearing will be held in the William O. Douglas Room of the Commission's headquarters at 450 Fifth Street, NW, Washington, DC 20549. The April 21, 2004 hearing will be held at the InterContinental The Barclay New York at 111 East 48th Street, New York, NY 10017. Persons submitting requests to appear or written testimony in lieu of testifying should file three copies of the request or testimony with Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20459-0609. Persons requesting to appear should also submit three copies of their oral statement or summary of their testimony to the same address. Requests to appear and copies of oral statements or summaries of intended testimony may be filed electronically at the following e-mail address: firstname.lastname@example.org. The words "Request to Testify" should be clearly noted on the subject line of the request. All requests and other submissions also should refer to File No. S7-10-04. Copies of all requests and other submissions and transcripts of the hearings will be available for public inspection and copying in the Commission's Public Reference Room at 450 Fifth Street, NW, Washington, DC 20549. All submitted requests and other materials will be posted on the Commission's Internet website (http://www.sec.gov). We do not edit personal information from submissions. You should submit only information that you wish to make available publicly.
For Further Information Contact: Sapna C. Patel, Special Counsel, Office of Market Supervision, Division of Market Regulation, at (202) 942-0166, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-1001.
I. Summary of Rule Proposals
The public hearings concern the Commission's proposed Regulation NMS. As more fully described in the Proposing Release1 (available on the Commission's website at http://www.sec.gov/rules/proposed/34-49325.htm), Regulation NMS would incorporate four substantive proposals that are designed to enhance and modernize the regulatory structure of the U.S. equity markets. First, the Commission has proposed a uniform rule for all national market system ("NMS") market centers that, subject to certain exceptions, would require a market center to establish, maintain, and enforce policies and procedures reasonably designed to prevent "trade-throughs" - the execution of an order in its market at a price that is inferior to a price displayed in another market. Second, the Commission has proposed a market access rule that would modernize the terms of access to quotations and execution of orders in the NMS. The third proposal would prohibit market participants from accepting, ranking, or displaying orders, quotes, or indications of interest in a pricing increment finer than a penny, except for securities with a share price of below $1.00. Finally, the Commission has proposed amendments to the rules and joint industry plans for disseminating market information to the public that, among other things, would modify the formulas for allocating plan net income to reward markets for more broadly based contributions to public price discovery. The Commission also has proposed to redesignate the NMS rules adopted under Section 11A of the Securities Exchange Act of 1934 as Regulation NMS. The Commission will consider the hearing record in connection with its rulemaking proposals.
II. Procedures for Hearing
The Commission will publish a schedule of appearances for the April 1st hearing on or about March 26, 2004 and for the April 21st hearing on or about April 12, 2004. Based on the number of requests received, the Commission may not be able to accommodate all requests. The Commission may limit the time for formal presentations or group presentations into a series of panels. Time will be reserved for members of the Commission and Commission staff to pose questions to each witness concerning his or her testimony as well as other matters pertaining to the Proposing Release. The Commission has designated Jonathan G. Katz, Secretary of the Commission, as the hearing officer.
By the Commission.
Margaret H. McFarland
Date: March 12, 2004
1 Securities Exchange Act Release No. 49325 (February 26, 2004), 69 FR 11126 (March 9, 2004).