September 30, 2002
Margaret H. McFarland
Re: File No. SR-NASD-2002-108: Notice of Filing of Proposed Rule Change by the National Association of Securities Dealers, Inc. Relating to Business Continuity Plans and Emergency Contact Information
The Securities Industry Association ("SIA")1 and the Bond Market Association ("TBMA")2 (collectively, the "Associations") are pleased to comment on the proposal ("Proposal") by the National Association of Securities Dealers, Inc. ("NASD") to adopt Rule 3510 (concerning Business Continuity Plans) and Rule 3520 (concerning Emergency Contact Information).
We commend the NASD in their continuing efforts to consider steps that member firms can take to ensure that they are prepared for possible future business disruptions. We support industry-wide implementation of business continuity plans. Indeed, in December 2001, SIA formed a Business Continuity Planning ("BCP") Committee by incorporating a preexisting informal industry forum known as the Securities Industry Business Continuity Management Group. The Committee's mission is to:
Similarly, TBMA also formed a Business Continuity Management Council ("BCMC"), which serves as a standing advisory committee of TBMA's Board to advise on, and coordinate, TBMA's activities relating to fixed income business or industry utility disruptions and policy responses to the September 11th tragedy. The BCMC is composed of members of preexisting committees of TBMA, in addition to others with expertise in business continuity planning. TBMA is mindful of the need to ensure careful coordination with other industry groups that are working in this area, and will in particular provide input on an ongoing basis to SIA's BCP Committee, as its work relates to fixed income issues.
In May 2002, the Associations responded to the initial publication of the proposed concerning Business Continuity Plans and Emergency Contact Information. We appreciate the inclusion of many of our comments in your latest published proposed rules. Our intent with this comment letter is to re-iterate points which we believe remain in the best interests of our memberships, and to provide comments on other points raised in the proposed rules.
The Associations applaud the coordination of rule changes between regulators as evidenced by the NYSE and NASD. Just as the Associations are working to coordinate the response of the securities industry, it is important that regulatory efforts be similarly coordinated.
Proposed Rule 3510: Business Continuity Plans
The Associations agree that the requirements of a business continuity plan must be tailored to the size and needs of an individual member firm, but that each plan must at a minimum address the aspects of continuity that are addressed in the release.
We offer the following specific comments on the Plan Elements:
We hope that these comments are helpful. Please feel free to contact Art Trager, Vice-President & Managing Director, Technology & Operations (212-618-0546; firstname.lastname@example.org) with any additional questions you may have concerning these matters.
Very truly yours,
Jerry W. Klawitter
cc: Robert R. Glauber, Chairman and CEO, NASD