Notices. Notice and request for comments
14,655 words·~67 min read·
/register/2006/04/11/06-3421·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-53596; File No. SR-NASD-2004-044] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Order Approving Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to Short Sale Delivery Requirements April 4, 2006. I. Introduction On March 10, 2004, the National Association of Securities Dealers, Inc. (“NASD”) filed with the Securities and Exchange Commission (“Commission” or “SEC”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”) 1 and Rule 19b-4 thereunder, 2 a proposed rule change to apply a delivery framework to certain non-reporting equity securities similar to that imposed on reporting equity securities by Regulation SHO. 3 The NASD submitted Amendment No. 1 to its proposed rule change on October 6, 2005 and submitted Amendment No. 2 to its proposed rule change on October 28, 2005. 4 The proposed rule change, as amended, was published for notice and comment in the **Federal Register** on November 16, 2005. 5 The Commission received nine comment letters on the proposal. 6 The NASD filed a response to the comment letters on March 15, 2006. 7 This order approves the proposed rule change, as amended. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 *See* Exchange Act Release No. 50103 (July 28, 2004), 69 FR 48008 (Aug. 6, 2004) (“Regulation SHO Adopting Release”).
The Commission adopted Regulation SHO to, among other things, impose a requirement on a participant of a registered clearing agency to take action to close out fail to deliver positions in “threshold securities.” Regulation SHO defines a “threshold security” as any equity security that is registered under Section 12 of the Act, or where the issuer of such security is required to file reports under Section 15(d) of the Act, and which security has, for five consecutive settlement days, had aggregate fails to deliver at a registered clearing agency of at least 10,000 shares that are also equal to at least 0.5% of the issuer's total shares outstanding (“TSO”). *See* 17 CFR 242.203(c)(6).
In the Regulation SHO Adopting Release, the Commission noted that because the calculation of the threshold that would trigger the delivery requirements under the rule depends on identifying the aggregate fails to deliver as a percentage of the TSO, the Commission believed it was necessary to limit the close out requirement to companies that are subject to the reporting requirements of the Act. *See* Regulation SHO Adopting Release, 69 FR at 48016, fn. 82. 4 On account of the adoption of Regulation SHO, Amendment No. 1, among other things, narrowed the scope of the proposal to those equity securities not otherwise covered by the delivery requirements of Rule 203(b) of Regulation SHO.
Amendment No. 2 replaced and superseded Amendment No. 1 in its entirety and made technical changes to the proposed rule change. 5 *See* Securities Exchange Act Release No. 52752 (Nov. 8, 2005), 70 FR 69614 (Nov. 16, 2005) (“Proposing Release”). 6 *See* Letter from Paul Vuksich, II, dated December 22, 2005; letter from Amal Aly, Vice President and Associate General Counsel, Securities Industry Association, on behalf of the Securities Industry Association Regulation SHO Working Group, dated December 14, 2005 (“SIA Letter”); letter from Jim L.
Hoch, dated December 14, 2005; letter from Paul Vuksich, II, dated December 12, 2005 (“Vuksich Letter”); letter from Donald J. Stoecklein, President, Stoecklein Law Group, dated December 13, 2005 (“Stoecklein Law Group Letter”); letter from Peter J. Chepucavage, General Counsel, Plexus Consulting, dated December 1, 2005; letter from Bob O'Brien, dated November 17, 2005; letter from David Patch, dated November 14, 2005; and letter from Richard M. Rosenthal, Esq, dated November 10, 2005. 7 *See* letter from Andrea D.
Orr, Assistant General Counsel, NASD, to Nancy M. Morris, Secretary, SEC, dated March 15, 2006 (“Response to Comments”). II. Description of the Proposal The proposed rule change would require participants 8 of registered clearing agencies 9 to take action to immediately close out fail to deliver positions that exist for thirteen consecutive settlement days in non-reporting threshold securities by purchasing securities of like kind and quantity. A “non-reporting threshold security” is “any equity security of an issuer that is not registered pursuant to Section 12 of the Act 10 and for which the issuer is not required to file reports pursuant to Section 15(d) of the Act: 11
(A)For which there is an aggregate fail to deliver position for five consecutive settlement dates at a registered clearing agency of 10,000 shares or more and for which on each settlement day during the five consecutive day period, the reported last sale during the normal market hours for the security on that settlement day would value the aggregate fail to deliver position at $50,000 or more, provided that, if there is no reported last sale on a particular settlement day, then the price used to value the position on such settlement day would be the previously reported last sale; and
(B)is included on a list published by the NASD.” 8 A “participant” means a participant as defined in Section 3(a)(24) of the Act, that is an NASD member. *See* Proposing Release, *supra* note 5, 70 FR at 69615. 9 A “registered clearing agency” is a clearing agency, as defined in Section 3(a)(23)(A) of the Act, that is registered with the SEC pursuant to Section 17A of the Act. 10 15 U.S.C. 78 *l* . 11 15 U.S.C. 78 *o* (d). In addition, if the fail to deliver position is not closed out in the requisite time period, a participant or any broker-dealer for which it clears transactions, including market-makers, would be prohibited from accepting any short sale order in the non-reporting threshold security from another person, or effecting a short sale in the non-reporting threshold security for its own account, without borrowing the security or entering into a bona-fide arrangement to borrow the security, until the participant has closed out the fail to deliver position by purchasing securities of like kind and quantity. Under the proposed rule change, NASD would publish a list daily of the non-reporting threshold securities. 12 In order to be removed from the non-reporting threshold securities list, a security must not meet or exceed the threshold requirements in the proposed rule change for five consecutive settlement days. 13 12 Proposing Release, *supra* note 5, 70 FR at 69616. 13 *Id.* , 70 FR at 69615. III. Summary of Comments The Commission received nine comment letters on the proposal. 14 Several commenters supported the proposal. 14 *See supra* note 6. A. Delivery Requirements for Non-Reporting Threshold Securities Several commenters supported applying a delivery framework to non-reporting threshold securities. Some commenters, however, objected to certain provisions of the proposed rule change. i. Uniform Short Sale Delivery Requirements One commenter asserted that a uniform short sale delivery requirement for reporting and non-reporting equity securities would be preferable. 15 This commenter argued that the adoption of the proposed rule change would upset the regulatory uniformity that Regulation SHO 16 was intended to create because it would result in additional rules that apply only to NASD member firms. 17 In addition, this commenter expressed concern that separate rules for reporting and non-reporting equity securities could be subject to disparate revisions and/or interpretations, thereby subjecting member firms to different delivery requirements, depending on which securities are at issue. 18 15 *See* Letter, *supra* note 6, at 3. 16 *Id.* 17 *Id.* 18 *Id.* This commenter urged the Commission to amend the Regulation SHO delivery requirements to also address non-reporting equity securities. 19 19 *Id.* In its Response to Comments, NASD agreed that uniformity with respect to rulemaking across self-regulatory organizations (“SROs”) is preferable to the extent possible and practicable. 20 In addition, NASD noted that if, in the future, the SEC determines to amend the Regulation SHO delivery requirements to apply to non-reporting equity securities, NASD would consider repealing its rule. 21 NASD also stated in its Response to Comments that, although NASD believes that the vast majority of trading in non-reporting securities occurs through NASD members, uniformity in this area can be achieved if other SROs propose similar requirements. NASD also noted that it did not believe it was appropriate to forestall an SRO proposal solely because other SROs have not put forth comparable requirements. 22 20 Response to Comments, *supra* note 7, at 4. 21 *Id.* 22 *Id.* ii. $50,000 Threshold Requirement Some commenters opposed the $50,000 value threshold requirement contained in the definition of a “non-reporting threshold security.” For example, one commenter argued that the dollar threshold value is inappropriate, stating that it is not an accurate indicator of non-reporting securities with excessive fails to deliver. 23 Another commenter believed that the dollar threshold value was too high, noting that such a value would harm small companies, 24 while another commenter argued that the dollar threshold value was too low and would capture a vastly expanded universe of threshold securities. 25 23 *See* Stoecklein Law Group Letter, *supra* note 6, at 1. 24 *See* Vuksich Letter, *supra* note 6, at 1. 25 *See* SIA Letter, *supra* note 6, at 5. In its Response to Comments, NASD noted that it proposed the dollar threshold value to ensure that the non-reporting threshold security list would not be overly broad or impracticable. 26 NASD noted that it was concerned that having a security on the non-reporting threshold security list solely based on whether the failure to deliver position is equal to, or greater than, 10,000 shares may not represent a significant failure to deliver position relative to the price of the security, particularly given that many non-reporting securities trade at less than $1.00. 27 Thus, NASD believes that the $50,000 value threshold strikes an appropriate balance to ensure that the threshold list is not overly broad or narrow. 28 26 Response to Comments, *supra* note 7, at 3. 27 *Id.* 28 *Id.* In addition, in its Response to Comments, NASD noted that NASD staff analyzed data relating to non-reporting securities over a five-day settlement period in February 2006 to get an indication of the number of non-reporting securities that would meet the proposed threshold requirements. During this time period, the analysis indicated that 44 securities would be deemed non-reporting threshold securities under the proposed threshold requirements. *See* Response to Comments, *supra* note 7, at fn. 20. iii. Impact on Liquidity in the Marketplace One commenter believed that the proposed rule change may result in negative consequences for this class of securities, such as further reducing liquidity in already illiquid securities and having a greater impact on price than would be the case with reporting equity securities. 29 29 *See* SIA Letter, *supra* note 6, at 4. In its Response to Comments, NASD noted that similar concerns were raised in the context of Regulation SHO, to which the SEC responded that the requirements would only apply to a limited number of securities and would not apply to any fail to deliver positions existing prior to the security meeting the threshold requirements. 30 NASD noted in its Response to Comments that it believes these same assertions apply in the context of the proposed rule change as well, given the Commission's Office of Economic Analysis' (“OEA”) estimates on non-reporting securities with fails to deliver of 10,000 shares or greater, 31 and that NASD's proposal would further reduce this estimate due to the proposed additional $50,000 value threshold requirement. 32 30 Response to Comments, *supra* note 7, at 5. 31 In its Response to Comments, NASD noted that general estimates relating to the number of non-reporting securities with fails to deliver in excess of 10,000 shares were made publicly available as part of the Regulation SHO Adopting Release. NASD noted that the Regulation SHO Adopting Release provided that the Commission's OEA analyzed NSCC data on fails to deliver in excess of 10,000 shares for non-reporting issuers and estimated that only an additional 1% of all securities would be added to its estimate of the number of securities that would be subject to the close out requirements of Regulation SHO. *See* Response to Comments *supra* note 7, at 4 (referencing the Regulation SHO Adopting Release at fn. 86). 32 *See id.* at 5. iv. Exemptive Authority One commenter raised concerns with the provision that permits NASD to grant exemptive relief under certain specified conditions, arguing that NASD may abuse such discretion or the provision may provide a blanket exemption to firms. 33 33 *See* Stoecklein Law Group Letter, *supra* note 6, at 1. In its Response to Comments, NASD commented that it believes this comment is without merit. 34 NASD believes that it is important to have the ability to address, through the exemptive process, situations that may warrant relief. 35 In addition, NASD noted that the proposed exemptive authority, by its terms, is specifically limited to those situations where granting such relief is consistent with the protection of investors and the public interest, and NASD will execute such authority consistent with this requirement. 36 34 Response to Comments, *supra* note 7, at 4. 35 *Id.* 36 *Id.* B. Defined Terms NASD proposed that the term “non-reporting threshold security” means “any equity security of an issuer that is not registered pursuant to Section 12 of the Act 37 and for which the issuer is not required to file reports pursuant to Section 15(d) of the Act: 38
(A)for which there is an aggregate fail to deliver position for five consecutive settlement dates at a registered clearing agency of 10,000 shares or more and for which on each settlement day during the five consecutive day period, the reported last sale during the normal market hours for the security on that settlement day that would value the aggregate fail to deliver position at $50,000 or more, provided that, if there is no reported last sale on a particular settlement day, then the price used to value the position on such settlement day would be the previously reported last sale; and
(B)is included on a list published by the NASD.” 39 37 15 U.S.C. 78 *l* . 38 15 U.S.C. 78 *o* (d). 39 Proposing Release, *supra* note 5, 70 FR at 69615. The Commission agrees with NASD that imposing a lower dollar value threshold requirement, or eliminating it altogether, as some commenters suggested, might be impracticable or an overly-broad method of addressing any potential abuses in this sector of the marketplace. Similarly, the Commission agrees with NASD that increasing the dollar value threshold requirement could be too limiting. As noted above, a five-day settlement period analysis by NASD staff found that under the proposed threshold requirements, only approximately 44 securities would qualify as non-reporting threshold securities. 40 40 *See supra* note 28. C. Implementation NASD suggests that the effective date of the proposed rule change will be 30 days following publication of NASD's *Notice to Members* announcing Commission approval 41 and the Commission believes that this is reasonable. 41 NASD will announce the effective date of the proposed rule change in a *Notice to Members* to be published no later than 60 days following Commission approval. IV. Discussion and Commission Findings After careful review, the Commission finds, as discussed more fully below, that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association. The Commission finds specifically that the proposed rule change, as amended, is consistent with Sections 15A(b)(6) and 15A(b)(9) of the Act. 42 42 15 U.S.C. 78 *o* -3(b)(6) and (b)(9). Section 15A(b)(6) of the Act requires that NASD's rules are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. 43 Section 15A(b)(9) of the Act requires that NASD's rules do not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. 44 43 *See* 15 U.S.C. 78 *o* -3(b)(6). 44 *See* 15 U.S.C. 78 *o* -3(b)(9). Section 3(f) of the Act directs the Commission to consider, in addition to the protection of investors, whether approval of a rule change will promote efficiency, competition, and capital formation. 45 In approving the proposed rule change, the Commission has considered its impact on efficiency, competition, and capital formation. In particular, the Commission determined that requiring a delivery framework for non-reporting threshold securities similar to that required under Regulation SHO would increase investor confidence in this sector of the marketplace by helping to reduce fails to deliver which, in turn, would promote capital formation. 45 15 U.S.C. 78c(f). When the Commission adopted Regulation SHO, it did not apply the Regulation SHO delivery requirements to non-reporting threshold securities because the calculation of the threshold that would trigger the delivery requirements under Regulation SHO depends on identifying the aggregate fails to deliver as a percentage of the TSO that is generally obtained from periodic reports filed with the Commission. Thus, the Commission believed it was necessary to limit the delivery requirement to companies that are subject to the reporting requirements of the Act. The Commission believes that applying a delivery framework similar to that contained in Regulation SHO to non-reporting threshold securities will protect investors and the public interest by helping to reduce fails to deliver in this sector of the marketplace. Thus, the Commission finds that the proposed rule change is consistent with Sections 15A(b)(6) and 15A(b)(9) of the Act. V. Conclusion *It is therefore ordered,* pursuant to Section 19(b)(2) of the Act, 46 that the proposed rule change (SR-NASD-2004-044), as amended, be, and it hereby is, approved. 46 15 U.S.C. 78s(b)(2). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 47 47 17 CFR 200.30-3(a)(12). Nancy M. Morris, Secretary. [FR Doc. E6-5236 Filed 4-10-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-53598; File No. SR-NASD-2005-080] Self-Regulatory Organizations: National Association of Securities Dealers, Inc.; Notice of Filing of Proposed Rule Change and Amendment Nos. 1, 2 and 3 thereto to Establish New NASD Rule 2290 Regarding Fairness Opinions April 4, 2006. 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 June 24, 2005, the National Association of Securities Dealers, Inc. (“NASD”) filed with the Securities and Exchange Commission (“SEC” or “Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by NASD. On November 30, 2005, NASD filed Amendment No. 1 to the proposed rule change. 3 On January 25, 2006, NASD filed Amendment No. 2 to the proposed rule change. 4 On March 1, 2006, NASD filed Amendment No. 3 to the proposed rule change. 5 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 In Amendment No. 1, which supplemented the original filing, NASD modified the scope of the proposed rule change and made certain clarifications to the rule text following discussions with Commission staff. 4 In Amendment No. 2, NASD added clarifying language to the rule text following discussions with Commission staff. 5 Amendment No. 3 was a technical amendment and replaced and superseded the original filing, as amended, in its entirety. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change NASD is proposing to establish new NASD Rule 2290 to address disclosures and procedures concerning the issuance of fairness opinions. Below is the text of the proposed rule change. Proposed new language is in italics; proposed deletions are in brackets. 2200. COMMUNICATIONS WITH CUSTOMERS AND THE PUBLIC 2290. Fairness Opinions
(a)Disclosures *Any member issuing a fairness opinion that may be provided, or described, or otherwise referenced to public shareholders must disclose, to the extent not otherwise required, in such fairness opinion:* *(1) whether such member has acted as a financial advisor to any transaction that is the subject of the fairness opinion, and, if applicable, that it will receive compensation for:* *(A) rendering the fairness opinion that is contingent upon the successful completion of the transaction;* *(B) serving as an advisor that is contingent upon the successful completion of the transaction;* *(2) whether such member will receive any other payment or compensation contingent upon the successful completion of the transaction;* *(3) whether there is any material relationship that existed during the past two years or is mutually understood to be contemplated in which any compensation was received or is intended to be received as a result of the relationship between the member and the companies that are involved in the transaction that is the subject of the fairness opinion;* *(4) the categories of information that formed a substantial basis for the fairness opinion that was supplied to the member by the company requesting the opinion concerning the companies involved in the transaction and whether any such information in each such category has been independently verified by the member; and* *(5) whether the fairness opinion was approved or issued by a fairness committee.*
(b)Procedures *Any member issuing a fairness opinion must have procedures that address the process by which a fairness opinion is approved by a firm, including:* *(1) the types of transactions and the circumstances in which the member will use a fairness committee to approve or issue a fairness opinion, and in such transactions where it uses a fairness committee:* *(A) the process for selecting personnel to be on the fairness committee;* *(B) the necessary qualifications of persons serving on the fairness committee; and* *(C) the process to promote a balanced review by the fairness committee, including review and approval by persons who do not serve on or advise the “deal team” to the transaction;* *(2) the process to determine whether the valuation analyses used in the fairness opinion are appropriate, and the procedures should state the extent to which the appropriateness of the use of such valuation analyses is determined by the type of company or transaction that is the subject of the fairness opinion; and* *(3) the process to evaluate whether the amount and nature of the compensation from the transaction underlying the fairness opinion benefiting any individual officers, directors or employees, or class of such persons, relative to the benefits to shareholders of the company, is a factor in reaching a fairness determination.* II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, NASD 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. NASD 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 NASD notes that a fairness opinion addresses, from a financial point of view, the fairness of the consideration in a transaction. Fairness opinions are routinely used by directors of a company in corporate control transactions to satisfy their fiduciary duties to act with due care and in an informed manner. Although not required by statute or regulation, fairness opinions have become commonplace in corporate control transactions following the 1985 Delaware Supreme Court case of *Smith* v. *Van Gorkom* , 6 in which a corporate board was held to have breached its fiduciary duty of care by approving a merger without adequate information on the transaction, including information on the value of the company and the fairness of the offering price. 6 *Smith* v. *Van Gorkom* , 488 A.2d 858 (Del. 1985). NASD notes that, while a fairness opinion addresses the fairness, from a financial point of view, of the consideration involved in a transaction, it does not indicate whether the price of a particular transaction is the best price that could be attained. Rather, it opines on whether the price is “fair” or within an acceptable range of values. A fairness opinion is prepared for a company's board of directors; however, it is often provided to shareholders as part of proxy materials. Inasmuch as a fairness opinion is not required by regulation or statute, the board of directors determines whether to obtain a fairness opinion, the scope of such opinion, and the party preparing such opinion. NASD has been concerned that the disclosures provided in fairness opinions may not sufficiently inform public shareholders about the potential conflicts of interest that exist between the firm rendering the fairness opinion and the issuer. Among these conflicts are fees that the firm rendering the fairness opinion will receive upon the successful completion of the transaction (either from advisory fees or fees for the fairness opinion itself), as well as other material relationships between the firm and the issuer (including, but not limited to, serving as an underwriter, lender, market maker, asset manager, or providing research coverage). NASD notes that, under the SEC's proxy rules, which apply to issuers, certain disclosures about potential conflicts of interest are provided to public shareholders. NASD believes that complementary rules for disclosure aimed at broker-dealers rendering fairness opinions would be beneficial. In addition, NASD believes that broker-dealers should develop greater specificity in their written supervisory procedures to guard against conflicts of interest in rendering fairness opinions. To that end, NASD is proposing to identify specific procedures that must be addressed by each firm that renders a fairness opinion. Paragraph (a)(1) of the proposed rule change sets forth the requirement for a member to disclose in any fairness opinion that may be provided, or described, or otherwise referenced to public shareholders, whether it has acted as a financial advisor to any transaction that is the subject of the fairness opinion, and, if applicable, that it will receive compensation for:
(A)Rendering the fairness opinion that is contingent upon the successful completion of the transaction, or
(B)serving as an advisor that is contingent upon the successful completion of the transaction. Paragraph (a)(2) would require disclosure of whether such member will receive any other payment or compensation contingent upon the successful completion of the transaction. Paragraph (a)(3) would require disclosure of whether there is any material relationship that existed during the past two years or is mutually understood to be contemplated, in which any compensation was received or is intended to be received as a result of the relationship between the member and the companies that are involved in the transaction that is the subject of the fairness opinion. NASD intends that the disclosures contemplated by paragraphs (a)(1)-(3) of the proposal be descriptive rather than quantitative. In particular, paragraphs (a)(1) and
(2)do not require firms to specify the amount of compensation for rendering the fairness opinion, serving as an advisor or otherwise, that is contingent upon the successful completion of the transaction. For purposes of the proposed rule change, NASD believes that it would be sufficient for investors to be informed that such contingent compensation relationships exist. Similarly, NASD intends that the disclosures in paragraph (a)(3) pertaining to “material relationships” also be descriptive rather than quantitative. Paragraph (a)(4) would require disclosure of the categories of information that formed a substantial basis for the fairness opinion that was supplied to the member by the company requesting the opinion concerning the companies involved in the transaction and whether any such information has been independently verified by the member. According to NASD, such disclosure must inform investors about the categories of information (such as projected earnings and revenues, expected cost-savings and synergies, industry trends and growth rate) that formed a substantial basis for the fairness opinion, and with respect to each category, whether the member has independently verified the information supplied by the company. Finally, paragraph (a)(5) would require disclosure of whether the fairness opinion was approved or issued by a fairness committee and informs investors of whether the fairness opinion was the product of a fairness committee. Paragraph (b)(1) of the proposed rule change contains the procedures members must follow in issuing a fairness opinion, including the types of transactions and the circumstances in which the member will use a fairness committee to approve or issue a fairness opinion, and, in such transactions where it uses a fairness committee:
(A)The process for selecting personnel to be on the fairness committee;
(B)the necessary qualifications of persons serving on the fairness committee; and
(C)the process to promote a balanced review by the fairness committee, including review and approval by persons who do not serve on or advise the “deal team” to the transaction. The procedures in paragraph (b)(2) would require members to have a process to determine whether the valuation analyses used in the fairness opinion are appropriate. In addition, the member's procedures should state the extent to which the appropriateness of the use of such valuation analyses is determined by the type of company or transaction that is the subject of the fairness opinion. Finally, paragraph (b)(3) would require members to have a process to evaluate whether the amount and nature of the compensation from the transaction underlying the fairness opinion benefits any individual officers, directors or employees, or class of such persons, relative to the benefits to shareholders of the company, is a factor in reaching a fairness determination. NASD intends to announce the effective date of the proposed rule change in a *Notice to Members* to be published no later than 60 days following Commission approval. The effective date will be 30 days following publication of the *Notice to Members* announcing Commission approval. 2. Statutory Basis NASD believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act, which requires, among other things, that NASD rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. NASD believes that investors and the public interest will benefit from additional disclosure of potential conflicts of interest in connection with fairness opinions rendered by broker- dealers. NASD also believes that members should develop and adhere to more detailed procedures to mitigate potential conflicts in rendering fairness opinions. B. Self-Regulatory Organization's Statement on Burden on Competition NASD does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The proposed rule change was published for comment in NASD *Notice to Members* 04-83 (November 2004). Twenty comment letters were received in response to the *Notice* . 7 Of the twenty comment letters received, twelve were in favor of the proposed rule change, seven were opposed, and one expressed no opinion. 7 Letter from Lerner College of Business and Economics, University of Delaware dated Nov. 24, 2004; Letter from Ohio Public Employees Retirement System dated Nov. 30, 2004; Letter from Ohio Retirement Systems dated Dec. 9, 2004; Letter from Charles M. Elson, Arthur H. Rosenbloom, and Drew G.L. Chapman dated Dec. 21, 2004; Letter from The Canadian Institute of Chartered Business Valuators dated Jan. 6, 2005; Letter from American Federation of Labor and Congress of Industrial Organizations (“AFL-CIO”) dated Jan. 10, 2005; Letter from Kane & Company, Inc. (“Kane”) dated Jan. 10, 2005; Letter from Standard & Poor's Corporate Value Consulting (“S&P”) dated Jan. 10, 2005; Letter from Council of Institutional Investors dated Jan. 12, 2005; Letter from The Committee on Securities Regulation of the Business Law Section of the New York State Bar Association dated Jan. 26, 2005; Letter from Cravath, Swaine & Moore LLP dated Jan. 31, 2005; Letter from HFBE Capital, L.P. dated Jan. 31, 2005; Letter from Signal Hill Capital Group LLC dated Jan. 31, 2005; Letter from Sutter Securities Incorporated dated Jan. 31, 2005; Letter from California Public Employees' Retirement System (“CalPERS”) dated Feb. 1, 2005; Letter from Davis Polk & Wardwell (“David Polk”) dated Feb. 1, 2005; Letter from Dewey Ballantine LLP dated Feb. 1, 2005; Letter from Houlihan Lokey Howard & Zukin (“Houlihan Lokey”) dated Feb. 1, 2005; Letter from Securities Industry Association dated Feb. 1, 2005; and Letter from The Special Committee on Mergers, Acquisitions and Corporate Control Contests of the Association of the Bar of the City of New York dated Feb. 1, 2005. In *Notice to Members* 04-83, NASD solicited comment on whether to propose a new rule that would require disclosures and procedures in connection with conflicts of interest when members provide fairness opinions in corporate control transactions. Although *Notice to Members* 04-83 did not contain specific rule text, it proposed the following: 1. Any fairness opinion rendered by a member and contained in a proxy statement shall describe a clear and complete description of the material conflicts of interests in issuing the opinion, including the nature of any contingent compensation that the member would receive upon successful completion of the transaction. 2. The member would be required to disclose in the fairness opinion the extent upon which it either relied on the information supplied by the company or independently verified such information. 3. The member would need to maintain written policies and procedures that, with respect to the issuance of fairness opinions, address: • the approval process by the member; if the member uses a fairness committee, then the level of experience for committee members, how balanced approval is undertaken and whether steps have been taken to require review by persons whose compensation is not directly related to the transaction; • the manner by which it will be determined that the appropriate valuation process will be used in light of the nature of the transaction and the types of companies that are involved; and • whether, in a particular transaction, the relative compensation to company insiders versus shareholders is a factor in reaching a fairness determination. One of the central elements of *Notice to Members* 04-83 was that any fairness opinion rendered by a member and contained in a proxy statement describe a clear and complete description of the significant potential conflicts of interests in issuing the opinion, including the nature of any contingent compensation that the member would receive upon successful completion of the transaction. A. What Constitutes a Conflict of Interest? Many commenters recognized the need for disclosure of potential conflicts of interest, although several commenters took issue with the term “conflict of interest” and instead preferred the term “material relationships” as used in SEC's Regulation M-A. *Notice to Members* 04-83 focused on potential conflicts arising from serving as advisor to the transaction, such as receiving a contingency fee for a completed transaction. Many commenters believed that a success fee, either for the fairness opinion or the transaction in question, should be disclosed. One commenter noted that potential conflicts of interest may arise under many other circumstances, including serving as an underwriter, lender, market maker, asset manager, or providing research coverage. Several commenters noted that existing rules of the SEC and common law currently require extensive disclosure in connection with fairness opinions and urged NASD to make sure its rules were consistent with these existing requirements. There was some support for a rule that “complements” existing disclosure requirements. NASD believes that the proposed rule change is consistent with existing SEC requirements. In the proposed rule change, NASD would require disclosure of “whether there is any material relationship that existed during the past two years or is mutually understood to be contemplated in which any compensation was received or is intended to be received as a result of the relationship between the member and the companies that are involved in the transaction that is the subject of the fairness opinion.” This disclosure is based on the requirements in Item 1015(b)(4) of SEC's Regulation M-A. 8 NASD has not sought to require firms to identify “any significant conflicts of interest” as originally proposed in *Notice to Members* 04-83. 8 17 CFR 229.1015(b)(4). While the rule text of paragraph (a)(3) of the proposed rule change was modeled after Item 1015(b)(4), NASD does not intend to construe this section to require quantitative disclosures of the compensation from each material relationship. For purposes of the proposed rule change, NASD believes it will be sufficient for investors to be informed about the material relationships that exist. NASD also notes that the proposed rule change differs slightly from Item 1015(b)(4) in that the proposed rule change applies to a material relationship between “the member and the companies” involved in the transaction, whereas Item 1015(b)(4) applies only to the member (and its affiliates) and the company (and its affiliates) for which the member is rendering the fairness opinion. NASD believes that investors should be informed of material relationships between the firm authoring the fairness opinion and the companies involved on both sides of the transaction. Moreover, given the narrative (i.e., non-quantitative) focus of this paragraph, NASD believes the additional disclosures are not likely to be burdensome on firms or confusing to investors. NASD notes, however, that unlike Item 1015, Rule 2290 does not reach to affiliates of such companies. NASD intends to review the comment letters received by the SEC before determining whether to amend paragraph (a)(3) to include affiliates. Several commenters asked NASD to “take stronger measures” to address conflicts in connection with fairness opinions, including requiring “independent” fairness opinions rendered by outside experts that are not connected to the transaction. One commenter recommended prohibiting investment banks from receiving success fees for transactions in which they issue fairness opinions. And another commenter urged an outright ban on arrangements in which part of an investment bank's fee for rendering a fairness opinion is contingent on the transaction closing. NASD has considered carefully those comments urging stronger measures such as an independent fairness opinion or a prohibition on success fees. As a starting point to its analysis, NASD notes that fairness opinions are not required by regulation or statute; a board of directors determines whether to obtain a fairness opinion, and if so, what the scope of a fairness opinion shall be and who shall prepare such opinion. In addition, NASD believes that, to the extent that a board of directors wants a fairness opinion from a firm not serving as an advisor to the transaction, or to structure payments without a contingency fee, it can do so. NASD notes that arguments that independent fairness opinions or those without a success fee component offer advantages may be well-founded. However, it is NASD's view that such matters are more appropriately situated within the purview of the board of directors and state corporation law. NASD believes that disclosure and procedures constitute the appropriate course in mitigating potential conflicts of interest in the rendering of fairness opinions, not otherwise limited under applicable law, by NASD members. Moreover, NASD believes that the lack of consensus among those commenters urging NASD to take stronger measures supports the more uniform course of disclosure and procedures. Whereas CalPERS asked NASD to prohibit “investment banks from receiving ‘success’ fees for transactions in which they issue fairness opinions,” 9 the AFL-CIO sought only to prohibit “arrangements in which part of an investment bank's fee for rendering *its opinion* is contingent on the transaction closing.” 10 Some commenters, such as Kane, want to forbid firms with a certain threshold amount of securities business with a company from rendering a fairness opinion, whereas AFL-CIO “do[es] not believe the mere existence of a business relationship with a company should disqualify an investment bank from providing a fairness opinion.” 11 9 CalPERS, at 2. 10 AFL-CIO, at 3. 11 *Id.* , at 1. As NASD noted above, fairness opinions are obtained by boards of directors to satisfy their fiduciary duties to act with due care and in an informed manner. NASD further notes that a fairness opinion is not an automatic defense to a claim that a board breached its fiduciary duties. Courts regularly examine the circumstances surrounding a fairness opinion to determine whether it can be relied upon by the board in satisfaction of its fiduciary duties. Thus, NASD notes that boards of directors must today take into account whether an issuer's relationship with an investment bank compromises the purposes for which the fairness opinion is sought. NASD believes that the disclosure standards in these proposed rules would be an important aid to an issuer's board in making that determination. B. To Whom Should Disclosure be Made? Some commenters believe that the proposed rule change should only require disclosure of potential conflicts by the member to the board of directors, citing concerns about breach of confidentiality if relationships between the member firm authoring the fairness opinion and its issuer client were publicly disclosed. Others believe that disclosure should be made more broadly, including in the fairness opinion itself, so that any reader of the fairness opinion can assess the conflicts associated with such opinion. NASD believes that, in general, a board of directors already is in a position to become informed about the potential conflicts with an investment bank that it chooses to render a fairness opinion. NASD notes, however, that investor-shareholders typically do not occupy the same such position. As stated in *Notice to Members* 04-83, NASD's concern is that investors may not be sufficiently informed “about the subjective nature of some opinions and their potential biases.” Accordingly, the proposed rule change requires disclosures by any member issuing a fairness opinion that may be provided, or described, or otherwise referenced to public shareholders. The requirements attach to any such fairness opinion issued by a member, regardless of whether it is included in proxy materials. C. Verification As NASD noted above, the proposal in *Notice to Members* 04-83 would require a firm to disclose in a fairness opinion the extent upon which it either relied on the information supplied by the company or independently verified such information. Nearly every party commenting on this provision stated that firms as a matter of course already disclose in the fairness opinion that they do *not* independently verify information provided by the issuer. While most commenters did not believe that there was any need for an NASD rule given current practices, the commenters did not oppose NASD rulemaking so long as it did not create a requirement for firms to verify information before rendering a fairness opinion. Many commenters stated that the terms of engagement for rendering a fairness opinion do not call for independent verification of information provided by management, and that other entities, such as forensic accountants, would be better skilled to verify data. S&P suggested that fairness opinions include disclosure of the information provided by management upon which the opinion is based, and could take the form of a “List of Documents Relied Upon,” similar to that which accompanies an expert's report in commercial litigation. 12 12 S&P, at 2-3. The proposed rule change would not require a member to independently verify data provided by the issuer. NASD agrees with commenters that the scope of a firm's obligations in rendering a fairness opinion is set forth in the terms of engagement with the client, and it is not required that such terms call for independent verification. NASD believes, however, that, to the extent categories of information (such as projected earnings and revenues, expected cost-savings and synergies, industry trends and growth rate) that were supplied by the company requesting the opinion formed a substantial basis for the fairness opinion, and information in each such category was not independently verified, readers of the fairness opinion should be apprised of this fact. Accordingly, the proposed rule change requires members to identify categories of information that formed a substantial basis for the fairness opinion and with respect to such information, whether any such information in each such category has been independently verified by the member. NASD notes that the proposed rule change goes beyond current practices in which firms state, for example, “[w]e have not independently verified the accuracy and completeness of the information supplied to us with respect to the [client] and do not assume any responsibility with respect to it.” 13 According to NASD, blanket statements that members have not verified information will not by themselves comply with the proposed rule change; members must identify information that formed a substantial basis for the fairness opinions and disclose whether such information was independently verified. 13 Houlihan Lokey, at 4. D. Written Policies and Procedures 1. Fairness Opinion Committee NASD solicited comment on whether to require written procedures governing the approval process by the member, including whether it uses a fairness committee, the level of experience for fairness committee members, how balanced approval is undertaken and whether steps have been taken to require review by persons whose compensation is not directly related to the transaction. Most commenters believed that firms already had procedures in place governing fairness opinions. Notwithstanding this fact, several commenters supported a well-tailored rule in this area. Commenters believed that NASD rulemaking should, however, provide the flexibility to allow each firm to determine the best manner of implementing effective and efficient procedures for reviewing and approving fairness opinions. Several commenters opposed any rule in which NASD would mandate specific procedures that must be followed. These commenters believed that the firms themselves—and not NASD—should determine what policies and procedures should be followed in rendering a fairness opinion. NASD believes that the proposed rule change is both well-tailored and flexible enough to allow firms to determine how to best implement effective and efficient procedures for reviewing and approving fairness opinions. The specific requirements were discussed in Item II.A.1 above. 2. Valuation NASD also solicited comment on whether to require written policies and procedures on the manner by which it will be determined that the appropriate valuation process will be used in light of the nature of the transaction and the types of companies that are involved. The commenters generally were concerned about any NASD rule that would interfere with the selection of the best methodology for a transaction. NASD does not believe the requirement in the proposed rule change to have written polices and procedures concerning the process to determine whether the valuation analyses used in the fairness opinion are appropriate, nor the requirement that procedures should state the extent to which the appropriateness of the use of such valuation analyses is determined by the type of company or transaction that is the subject of the fairness opinion, will interfere with a firm's ability to select the most appropriate methodology for a transaction. NASD believes that the procedures developed by the firm should be designed to allow the firm to identify and use the correct valuation methodology. In addition, NASD believes that the procedures should prevent the use of a particular valuation methodology at the behest of an interested party when such methodology is inappropriate. 3. Relative Compensation Finally, NASD solicited comment on a requirement for broker-dealers to have a process to evaluate whether the relative compensation to corporate insiders versus other shareholders in a contemplated transaction is a factor in reaching a fairness opinion. On the one hand, certain commenters felt the proposal did not go far enough. There was a view that change of control provisions that are a part of any transaction should be disclosed to shareholders as a material factor to be considered as part of the proxy process because often times such payments may be ambiguous or may not be expressly set out in the deal terms of a transaction. With respect to these commenters, NASD believes the purpose of the proposed requirement in this area is misunderstood. According to NASD, the proposed rulemaking, as it pertains to dealing with the factor of relative compensation in the fairness opinion process, is driven by the regulatory goal of ameliorating this potential conflict through procedures reasonably designed to consider whether in fact such conflict exists and to what extent it may bear on the determination that a transaction is fair. NASD states that it is not intended to fashion additional substantive legal requirements more appropriately addressed, in NASD's view, by state corporation law and the federal law and rules concerning proxies. It is NASD's view that subjecting this potential conflict to the rigor of appropriately and reasonably designed procedures is an appropriate prophylactic with respect to a factor that may or may not weigh on the determination that a transaction is fair. On the other hand, other commenters felt that management's interests in change of control transactions were not an applicable part of the fairness opinion process because the appropriateness of management compensation was beyond the scope of the fairness opinions, was difficult or impossible to quantify, in many cases rested upon arrangements that preceded the transaction, and required an expertise in executive compensation that is beyond the competency of those issuing fairness opinions. Again, NASD believes that these comments evidence a misunderstanding of the proposed requirement. NASD does not believe that broker-dealers issuing fairness opinions should review the propriety of preexisting compensation arrangements as such matters would be like any other preexisting fixed or contingent liability of the corporation that cannot be altered by the terms of any change of control transaction. According to the NASD, the intent of the proposed requirement is that firms consider the extent to which the differential in remuneration between management and other shareholders accruing from the deal proceeds, for which there was no prior contractual commitment, is a factor in determining the fairness of the transaction to shareholders. NASD notes that the proposed requirement does not reach the implicit conclusion that such differential payments are a factor as to whether a transaction is fair but, in NASD's view, it would be equally wrong to conclude that such differential payments are inappropriately placed among the factors and indicia that one should consider in rendering a fairness opinion. NASD believes it is true that a fairness opinion merely states that the transaction is fair and does not necessarily represent the best price. However, NASD also believes it is true that the considerations surrounding the issuance of a fairness opinion are artificially truncated when the total amount that a buyer is willing to pay and how such payment is allocated is never an appropriate factor in a change of control transaction. E. Other S&P suggested greater transparency in fairness opinion pricing. Insofar as the price of many fairness opinions is bundled with other advisory services, S&P believed that corporate boards of directors are often less willing to procure an independent fairness opinion. S&P believed that full disclosure of the fairness opinion fee, and in some instances, an actual indication of the financial advisor's effort, could be meaningful disclosure. 14 NASD does not believe it should mandate disclosure of the price or effort expended in preparing the fairness opinion. With respect to price, it is NASD's view that if a board of directors believes it would benefit from more detailed information about prices, it is in a position to obtain that information from the firm as a condition of engaging the firm to perform advisory and fairness opinion services. With respect to effort, this seems to NASD a potentially misleading metric upon which any reliance would be placed. NASD believes that efforts, great or small, expended upon poorly conceived procedures are of dubious value. Consequently, NASD believes that the appropriate regulatory response is to require members to employ processes framed by appropriately and reasonably designed procedures. 14 S&P, at 2. Davis Polk was concerned that NASD rules concerning fairness opinions would discriminate against member firms, since fairness opinions can be provided by non-broker-dealers. 15 NASD recognizes that firms not subject to NASD's jurisdiction are able to render fairness opinions; however, NASD believes that this is not a justification for failing to address actual or perceived conflicts of interest in the brokerage industry or inadequacies in disclosure by such firms. 15 Davis Polk, at 3-4. Finally, several commenters suggested that existing judicial precedent and oversight are more effective controls over the fairness opinion process than would be a new NASD rule, and one commenter suggested that NASD rulemaking may interfere with standards for fairness opinions under corporate law. NASD recognizes and appreciates the role of corporate law on the fairness opinion process. As NASD has noted above, a fairness opinion must comply with corporate law to serve its intended purpose—to satisfy their fiduciary duties to act with due care and in an informed manner. While NASD understands its rules operate in conjunction with judicial precedent, it does not believe that judicial review should exclude NASD rulemaking. NASD notes that many aspects of the securities laws are subject to extensive judicial review, but that would be an illogical and novel barrier to SEC and SRO rulemaking. 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 such proposed rule change, or B. institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments The Commission notes that the NASD's proposal would not require firms to quantify in the fairness opinion the amount of compensation received that is contingent upon the successful completion of the transaction or to be received as a result of any material relationship between the member firm and any party to the transaction. The Commission requests comment regarding whether the disclosures that would be required by proposed Rule 2290(a)(1), (2), and
(3)should be quantified. Further, we request comment as to whether it would be more informative to investors for firms to specifically state that a conflict may exist and describe the impact of such conflict rather than to merely state that compensation is contingent. The Commission further notes that the proposed disclosure of material relationships does not extend to relationships with affiliates of the member firm. The Commission requests comment regarding whether the proposed disclosure obligation should cover material relationships between the parties to the transaction and affiliates of the member firm providing the fairness opinion. In addition, the Commission requests comment as to whether member firms should be required to describe what type of verification they undertook with respect to information that was supplied by the company requesting the opinion that formed a substantial basis for the opinion. Further, the Commission requests comment on whether members should be required to obtain independent verification of such information. We also note that the proposed rule does not require disclosure of the procedures utilized by the member firm. We request comment as to whether member firms should disclose these procedures in the fairness opinion or elsewhere. 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. 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-NASD-2005-080 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-NASD-2005-080. 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, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of NASD. 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 the File Number SR-NASD-2005-080 and should be submitted on or before May 2, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 16 16 17 CFR 200.30-3(a)(12). Nancy M. Morris, Secretary. [FR Doc. E6-5237 Filed 4-10-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-53599; File No. SR-NYSE-2005-18] Self-Regulatory Organizations; New York Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change and Amendments Nos. 1 and 2 Thereto To Amend NYSE Rule 619 To Clarify That Failure To Appear or Produce Documents in Arbitration May Be Deemed Conduct Inconsistent With Just and Equitable Principles of Trade April 4, 2006. 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 February 17, 2005, the New York Stock Exchange, Inc. (“NYSE” or the “Exchange”) filed with the Securities and Exchange Commission (“SEC” or “Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. On July 27, 2005, the Exchange filed Amendment No. 1 to the proposed rule change. 3 On February 15, 2006, the Exchange filed Amendment No. 2 to the proposed rule change. 4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 In Amendment No. 1, which replaced the original filing, the Exchange clarified that Rule 619 also applies to a “person otherwise subject to the jurisdiction of the Exchange.” 4 Amendment No. 2, which replaced the first amended rule filing, conformed the proposed rule to reflect the list of persons subject to disciplinary action under NYSE Rule 476. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change would add a new paragraph
(h)to NYSE Rule 619 to clarify that the failure of a member, member organization, allied member, approved person, registered or non-registered employee of a member or member organization or person otherwise subject to the jurisdiction of the Exchange (each, a “responsible party”) to appear or to produce any document in their possession or control, as directed pursuant to provisions of the NYSE Arbitration Rules, may be deemed conduct or proceeding inconsistent with just and equitable principles of trade for purposes of NYSE Rule 476(a)(6). Below is the text of the proposed rule change. Proposed new language is in *italics.* General Provision Governing Subpoenas, Production of Documents, etc. Rule 619.
(a)through
(g)No Change. *(h) It may be deemed conduct or proceeding inconsistent with just and equitable principles of trade for purposes of Rule 476(a)(6) for a member, member organization, allied member, approved person, registered or non-registered employee of a member or member organization or person otherwise subject to the jurisdiction of the Exchange to fail to appear or to produce any document in their possession or control as directed pursuant to provisions of the NYSE Arbitration Rules.* 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. The text of these statements may be examined at the places specified in Item IV below. 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 The proposed rule change would add a new paragraph
(h)to NYSE Rule 619 (“General Provision Governing Subpoenas, Production of Documents, etc.”) to clarify that the failure of a responsible party to appear or to produce any document in its possession or control, as directed pursuant to provisions of the NYSE Arbitration Rules, may be deemed conduct or proceeding inconsistent with just and equitable principles of trade for purposes of NYSE Rule 476(a)(6). Background NYSE Rule 619 provides that the parties to an arbitration proceeding shall cooperate to the fullest extent practicable in the voluntary exchange of documents and information in order to expedite the arbitration process. Rule 619 also sets forth specific procedures and timetables with respect to the exchange of documents and information. 5 5 For example, Rule 619(b) requires, in part, that: “(1) Any party may serve a written request for information or documents (“information request”) upon another party twenty
(20)business days or more after service of the Statement of Claim by the Director of Arbitration or upon filing of the Answer, whichever is earlier. The requesting party shall serve the information request on all parties. The parties shall endeavor to resolve disputes regarding an information request prior to serving any objection to the request. Such efforts shall be set forth in the objection.
(2)Unless a greater time is allowed by the requesting party, information requests shall be satisfied or objected to within thirty
(30)calendar days from the date of service. Any objection to an information request shall be served by the objecting party on all parties.
(3)Any reponse to objections to an information request shall be served on all parties within ten
(10)calendar days of receipt to the objection.” Arbitrators may, in the decision rendered by the panel, refer to the NYSE Enforcement Division a failure to cooperate in the voluntary exchange of documents and information by a responsible party. Proposal The Exchange is aware of allegations that member organizations have not fulfilled their discovery obligations as prescribed by NYSE Arbitration Rules. In order to address such situations more effectively, and to reinforce adequately the quasi-judicial functions of the arbitration process, the NYSE is proposing to amend Rule 619 to make clear that it may be deemed conduct or proceeding inconsistent with just and equitable principles of trade for purposes of NYSE Rule 476(a)(6) for a responsible party to fail to appear or fail to produce any document in their possession or control as directed pursuant to provisions of the NYSE Arbitration Rules. NYSE Rule 476 allows disciplinary sanctions to be imposed upon a responsible party who is adjudged guilty of certain enumerated offenses, including “conduct or proceeding inconsistent with just and equitable principles of trade.” By explicitly providing that the failure to appear or to produce documents in one's possession or control may be deemed conduct or proceeding inconsistent with just and equitable principles of trade, the proposed amendment would provide the Exchange with a clear mechanism to pursue disciplinary action pursuant to NYSE Rule 476 in response to such conduct. The specific authority to bring a disciplinary action under NYSE Rule 476(a)(6) should improve the efficacy of the arbitration process by facilitating the Exchange's ability to ensure more fully and forcefully the cooperation of a responsible party who is a party to an arbitration proceeding. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the requirements of Section 6(b)(5) of the Act, 6 which requires, among other things, that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade and, in general, to protect investors and the public interest. NYSE believes that the proposed amendments to Rule 619 are consistent with Section 6(b)(5) in that they should help to ensure that the public has a fair and expeditious forum for the resolution of disputes. The NYSE believes that a further statutory basis for this proposed rule change is also found in Section 6(b)(6) of the Act, 7 which requires that the rules of an exchange provide that members and persons associated with its members shall be appropriately disciplined for violation of the provisions of the Act, the rules or regulations thereunder, or the rules of the exchange, by expulsion, suspension, limitation of activities, functions, and operations, fine, censure, being suspended or barred from being associated with a member, or any other fitting sanction. The Exchange believes that the proposed amendments to Rule 619 are consistent with Section 6(b)(6) in that they would facilitate appropriate disciplinary action for violation of a rule of the Exchange. 6 15 U.S.C. 78f(b)(5). 7 15 U.S.C. 78f(b)(6). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change, as amended 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 Written comments were neither solicited nor received. 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 Exchange consents, the Commission will:
(A)By order approve such 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. 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-2005-18 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-2005-18. 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 the filing also will be available for inspection and copying at the principal office of the Exchange. 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-2005-18 and should be submitted on or before May 2, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 8 8 17 CFR 200.30-3(a)(12). Nancy M. Morris, Secretary. [FR Doc. E6-5244 Filed 4-10-06; 8:45 am] BILLING CODE 8010-01-P SMALL BUSINESS ADMINISTRATION Data Collection Available for Public Comments and Recommendations ACTION: Notice and request for comments. SUMMARY: In accordance with the Paperwork Reduction Act of 1995, this notice announces the Small Business Administration's intentions to request approval on a new and/or currently approved information collection. DATES: Submit comments on or before June 12, 2006. ADDRESSES: Send all comments regarding whether these information collections are necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collections, to Carol Fendler, Director, Office of Licensing and Program Standards, Small Business Administration, 409 3rd Street SW., Suite 8300, Washington, DC 20416. FOR FURTHER INFORMATION CONTACT: Carol Fendler, Director, Office of Licensing and Program Standards 202-205-7559 *carol.fendler@sba.gov* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov.* Supplementary Information: *Title:* “Request for Information Concerning Portfolio Financing”. *Description of Respondents:* SBIC Investment Companies. *Form No:* 857. *Annual Responses:* 2,160. *Annual Burden:* 2,160. SUPPLEMENTARY INFORMATION: *Title:* “Financing Institution Confirmation Form”. *Description of Respondents:* SBIC Investment Companies. *Form No:* 860. *Annual Responses:* 1,500. *Annual Burden:* 750. ADDRESSES: Send all comments regarding whether these information collections are necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collections, to Radwan Saade, Economist, Office of Advocacy, Small Business Administration, 409 3rd Street SW., Suite 7800, Washington, DC 20416. FOR FURTHER INFORMATION CONTACT: Radwan Saade, Economist, Office of Advocacy 202-205-6878 *radwan.saade@sba.gov* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov .* SUPPLEMENTARY INFORMATION: *Title:* “Costs of Litigation to Small Business; Executive Interview Questionnaire”. *Description of Respondents:* Small Businesses. *Form No:* N/A. *Annual Responses:* 100. *Annual Burden:* 50. SUPPLEMENTARY INFORMATION: *Title:* Small Business Questionnaire (Use of Telecommunication)”. *Description of Respondents:* Small Businesses. *Form No:* N/A. *Annual Responses:* 750. *Annual Burden:* 63. ADDRESSES: Send all comments regarding whether these information collections are necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collections, to Cynthia Pitts, Administrative Officer, Office of Disaster, Small Business Administration, 409 3rd Street SW., Suite 6050, Wash., DC 20416. FOR FURTHER INFORMATION CONTACT: Cynthia Pitts, Administrative Officer, Office of Disaster 202-205-7570 *cynthia.pitts@sba.gov* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov .* SUPPLEMENTARY INFORMATION: *Title:* “Disaster Home Loan Application”. *Description of Respondents:* Applicants Requesting SBA Disaster Home Loan. *Form No's:* 5C, 739. *Annual Responses:* 47,962. *Annual Burden:* 71,943. SUPPLEMENTARY INFORMATION: *Title:* “Disaster Home/Business Loan Inquiry Record.” *Description of Respondents:* Disaster Victims. *Form No:* 700. *Annual Responses:* 42,196. *Annual Burden:* 10,549. SUPPLEMENTARY INFORMATION: *Title:* “Pre-Disaster Mitigation Small Business Loan Application”. *Description of Respondents:* Business Application for the Pre-Disaster mitigation loan program. *Form No:* 5M. *Annual Responses:* 2,500. *Annual Burden:* 5,000. SUPPLEMENTARY INFORMATION: *Title:* “Borrowers Progress Certification”. *Description of Respondents:* Disaster Loan Borrowers. *Form No:* 1366. *Annual Responses:* 24,156. *Annual Burden:* 12,078. ADDRESSES: Send all comments regarding whether this information collection is necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collection, to Sandra Johnston, Program Analyst, Office of Financial Assistance, Small Business Administration, 409 3rd Street, SW., Suite 8300, Wash., DC 20416. FOR FURTHER INFORMATION CONTACT: Sandra Johnston, Office of Financial Assistance, 202-205-7528 *sandra.johnston@sba.gov;* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov.* SUPPLEMENTARY INFORMATION: *Title:* “Report to SBA; Provisions of 13 CFR 120.472”. *Description of Respondents:* Small Business Lending Companies. *Form No:* N/A. *Annual Responses:* 14. *Annual Burden:* 1,120. ADDRESSES: Send all comments regarding whether this information collection is necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collection, to Linda Roberts, Director, Office of Security Operations, Small Business Administration, 409 3rd Street, SW., Suite 5000, Wash., DC 20416. FOR FURTHER INFORMATION CONTACT: Linda Roberts, Office of Security Operations, 202-205-6623 *linda.roberts@sba.gov;* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov.* SUPPLEMENTARY INFORMATION: *Title:* “Statement of Personal History”. Description of Respondents: Applicants for Assistance or Temporary Employment in Disaster. *Form No:* 912. *Annual Responses:* 55,000. *Annual Burden:* 13,750. ADDRESSES: Send all comments regarding whether this information collection is necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collection, to Rachel Newman Karton, Program Analyst, Office of Small Business Development Centers, Small Business Administration, 409 3rd Street, SW., Suite 6400, Wash., DC 20416. FOR FURTHER INFORMATION CONTACT: Rachel Newman Karton, Office of Small Business Development Centers, 202-619-1816 *rachel.newman@sba.gov;* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov .* SUPPLEMENTARY INFORMATION: *Title:* “SBA Counseling Evaluation.” *Description of Respondents:* Small Business Clients. *Form No:* 1419. *Annual Responses:* 15,000. *Annual Burden:* 3,000. ADDRESSES: Send all comments regarding whether this information collection is necessary for the proper performance of the function of the agency, whether the burden estimates are accurate, and if there are ways to minimize the estimated burden and enhance the quality of the collection, to Ann Bradbury, Financial Analyst, Office of Financial Assistance, Small Business Administration, 409 3rd Street, SW., Suite 8300, Wash., DC 20416. FOR FURTHER INFORMATION CONTACT: Ann Bradbury, Office of Financial Assistance, 202-7507 *ann.bradbury@sba.gov;* Curtis B. Rich, Management Analyst, 202-205-7030 *curtis.rich@sba.gov.* SUPPLEMENTARY INFORMATION: *Title:* “Entrepreneurial Development Management Information System (EDMIS) Counseling Information Form & Management Training Report”. *Description of Respondents:* New established and prospective Small Business Owners using the services and programs by the Business Information Center Program. *Form No's:* 641, 888. *Annual Responses:* 1. *Annual Burden:* 67,500. Jacqueline White, Chief, Administrative Information Branch. [FR Doc. E6-5248 Filed 4-10-06; 8:45 am] BILLING CODE 8025-01-P SMALL BUSINESS ADMINISTRATION [Disaster Declaration #10316 and #10317] Oklahoma Disaster Number OK-00002 AGENCY: U.S. Small Business Administration. ACTION: Amendment 4. SUMMARY: This is an amendment of the Presidential declaration of a major disaster for the State of Oklahoma (FEMA-1623-DR), dated 01/10/2006. *Incident:* Severe Wildfire Threat. *Incident Period:* 11/27/2005 and continuing through 03/31/2006. *Effective Date:* 03/31/2006. *Physical Loan Application Deadline Date:* 04/10/2006. *EIDL Loan Application Deadline Date:* 10/10/2006. ADDRESSES: Submit completed loan applications to: U.S. Small Business Administration, National Processing And Disbursement Center, 14925 Kingsport Road Fort, Worth, TX 76155. FOR FURTHER INFORMATION CONTACT: A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street, SW., Suite 6050, Washington, DC 20416. SUPPLEMENTARY INFORMATION: The notice of the President's major disaster declaration for the State of Oklahoma, dated 01/10/2006, is hereby amended to establish the incident period for this disaster as beginning 11/27/2005 and continuing through 03/31/2006. All other information in the original declaration remains unchanged. (Catalog of Federal Domestic Assistance Numbers 59002 and 59008) Roger B. Garland, Acting Associate Administrator for Disaster Assistance. [FR Doc. E6-5235 Filed 4-10-06; 8:45 am] BILLING CODE 8025-01-P SMALL BUSINESS ADMINISTRATION [Disaster Declaration # 10322 and # 10323] Texas Disaster NO. TX-00097 AGENCY: U.S. Small Business Administration. ACTION: Amendment 3. SUMMARY: This is an amendment of the Presidential declaration of a major disaster for the State of Texas ( FEMA-1624-DR), dated 01/11/2006. *Incident:* Extreme Wildfire Threat. *Incident Period:* 12/01/2005 and continuing. *Effective Date:* 04/03/2006. *Physical Loan Application Deadline Date:* 04/12/2006. *EIDL Loan Application Deadline Date:* 10/11/2006. ADDRESSES: Submit completed loan applications to: U.S. Small Business Administration, National Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155. FOR FURTHER INFORMATION CONTACT: A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street, SW., Suite 6050, Washington, DC 20416. SUPPLEMENTARY INFORMATION: The notice of the Presidential disaster declaration for the State of Texas, dated 01/11/2006 is hereby amended to include the following areas as adversely affected by the disaster: Primary Counties: Caldwell, Gray, Guadalupe, Hutchinson, Roberts, Wheeler. Contiguous Counties: Texas: Armstrong, Bexar, Carson, Collingsworth, Comal, Donley, Gonzales, Hansford, Hays, Hemphill, Lipscomb, Moore, Ochiltree, Sherman, Wilson. Oklahoma: Beckham, Roger Mills. All other information in the original declaration remains unchanged. (Catalog of Federal Domestic Assistance Numbers 59002 and 59008) Roger B. Garland, Acting Associate Administrator for Disaster Assistance. [FR Doc. E6-5231 Filed 4-10-06; 8:45 am] BILLING CODE 8025-01-P SMALL BUSINESS ADMINISTRATION National Small Business Development Center Advisory Board; Public Meeting The U.S. Small Business Administration, National Small Business Development Center Advisory Board will be hosting a public meeting via conference call on Tuesday, April 18, 2006 at 1 p.m. eastern standard time. The purpose of the meeting is to address ongoing issues of interest in the Small Business Development Center program; to plan for future projects; and to discuss the location for the summer meeting. Anyone wishing to make an oral presentation to the Board must contact Erika Fischer, Senior Program Analyst, U.S. Small Business Administration, Office of Small Business Development Centers, 409 3rd Street, SW., Washington, DC 20416, telephone
(202)205-7045 or fax
(202)481-0681. Matt Pohl, Special Assistant, Intergovernmental Affairs. [FR Doc. E6-5238 Filed 4-10-06; 8:45 am] BILLING CODE 8025-01-P SMALL BUSINESS ADMINISTRATION Public Federal Regulatory Enforcement Fairness Hearing; Region VIII Regulatory Fairness Board The U.S. Small Business Administration
(SBA)Region VIII Regulatory Fairness Board and the SBA Office of the National Ombudsman will hold a public hearing on Thursday, April 13, 2006, at 9 a.m. The meeting will take place at the Ramkota River Centre, Gallery B, 920 W. Sioux Avenue, Pierre, SD. The purpose of the meeting is to receive comments and testimony from small business owners, small government entities, and small non-profit organizations concerning regulatory enforcement and compliance actions taken by Federal agencies. Anyone wishing to attend or to make a presentation must contact Jon Haverly, in writing or by fax, in order to be put on the agenda. Jon Haverly, District Counsel, SBA, South Dakota District Office, 2329 N. Career Avenue #105, Sioux Falls, SD 57107, phone
(605)330-4243, Ext. 42, fax
(202)481-2684, e-mail: *jon.haverly@sba.gov.* For more information, see our Web site at *http://www.sba.gov/ombudsman.* Matt Pohl, Special Assistant, Intergovernmental Affairs. [FR Doc. E6-5239 Filed 4-10-06; 8:45 am] BILLING CODE 8025-01-P DEPARTMENT OF STATE [Public Notice 5371] 30-Day Notice of Proposed Information Collection: DS-4096 and SV-2005-0011, Reconstruction and Stabilization Volunteer Application and Evaluation, OMB Control Number 1405-XXXX ACTION: Notice of request for public comment and submission to OMB of proposed collection of information. SUMMARY: The Department of State has submitted the following information collection request to the Office of Management and Budget
(OMB)for approval in accordance with the Paperwork Reduction Act of 1995. *Title of Information Collection:* Reconstruction and Stabilization Volunteer Application and Evaluation. *OMB Control Number:* 1405-XXXX. *Type of Request:* New Collection. *Originating Office:* Office of the Coordinator for Reconstruction & Stabilization S/CRS. *Form Number:* DS-4096 and SV-2005-0011. *Respondents:* Civilians & USG Employees who have past experience in Reconstruction & Stabilization Activities and/or wish to volunteer for additional R & S deployments. *Estimated Number of Respondents:* 2400 per year. *Estimated Number of Responses:* 2400 per year. *Average Hours Per Response:* 30 minutes. *Total Estimated Burden:* 1200 Hours. *Frequency:* On Occasion. *Obligation to Respond:* Voluntary. DATES: Submit comments to the Office of Management and Budget
(OMB)for up to 30 days from April 11, 2006. ADDRESSES: Direct comments and questions to Alex Hunt, the Department of State Desk Officer in the Office of Information and Regulatory Affairs at the Office of Management and Budget (OMB), who may be reached at
(202)395-7860. You may submit comments by any of the following methods: • *E-mail: ahunt@omb.eop.gov.* You must include the DS form number, information collection title, and OMB control number in the subject line of your message. • *Mail (paper, disk, or CD-ROM submissions):* Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW., Washington, DC 20503. • Fax: 202-395-6974. FOR FURTHER INFORMATION CONTACT: Direct requests for additional information regarding the collection listed in this notice, including requests for copies of the proposed information collection and supporting documents, to James Stansell, U.S. Department of State, Suite 7100, 2121 Virginia Ave., NW., Washington, DC 20520 who may be reached on
(202)663-0850 Or StansellJW@state.gov. SUPPLEMENTARY INFORMATION: We are soliciting public comments to permit the Department to: • Evaluate whether the proposed information collection is necessary to properly perform our functions. • Evaluate the accuracy of our estimate of the burden of the proposed collection, including the validity of the methodology and assumptions used. • Enhance the quality, utility, and clarity of the information to be collected. • Minimize the reporting burden on those who are to respond, including the use of automated collection techniques or other forms of technology. Abstract of Proposed Collection The information collected is in keeping with the Department's responsibility to coordinate U.S. Government planning, and institutionalize U.S. capacity, to help stabilize and reconstruct societies in transition from conflict or civil strife so they can reach a sustainable path toward peace, democracy and a market economy. The evaluation will be conducted in order to learn from the experiences of those who have been involved in reconstruction and stabilization activities. The application will be used to solicit volunteers who are willing to participate in future operations. Methodology Respondents can access both information collection instruments via the S/CRS Web site ( *http://www.crs.state.gov* ), and will fill them out and submit them electronically. Dated: March 21, 2006. Marcia K. Wong, Principal Deputy Coordinator, Office of the Coordinator for Reconstruction & Stabilization, Department of State. Dated: March 20, 2006. Christopher Hoh, Director of Response Strategy & Resource Management, Office of the Coordinator for Reconstruction & Stabilization, Department of State. [FR Doc. E6-5285 Filed 4-10-06; 8:45 am] BILLING CODE 4710-10-P DEPARTMENT OF STATE [Public Notice 5373] Culturally Significant Objects Imported for Exhibition Determinations: “Americans in Paris, 1860-1900” *SUMMARY:* Notice is hereby given of the following determinations: Pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681, *et seq.* ; 22 U.S.C. 6501 note, *et seq.* ), Delegation of Authority No. 234 of October 1, 1999, Delegation of Authority No. 236 of October 19, 1999, as amended, and Delegation of Authority No. 257 of April 15, 2003 [68 FR 19875], I hereby determine that the objects to be included in the exhibition “Americans in Paris, 1860-1900”, imported from abroad for temporary exhibition within the United States, are of cultural significance. The objects are imported pursuant to loan agreements with the foreign owners or custodians. I also determine that the exhibition or display of the exhibit objects at the Museum of Fine Art, Boston, MA, from on or about June 25, 2006, until on or about September 24, 2006, the Metropolitan Museum of Art, New York, NY, from on or about October 17, 2006, until on or about January 28, 2007, and at possible additional venues yet to be determined, is in the national interest. Public Notice of these Determinations is ordered to be published in the **Federal Register** . FOR FURTHER INFORMATION CONTACT: For further information, including a list of the exhibit objects, contact Carol B. Epstein, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202/453-8050). The address is U.S. Department of State, SA-44, 301 4th Street, SW. Room 700, Washington, DC 20547-0001. Dated: April 3, 2006. C. Miller Crouch, Principal Deputy Assistant, Secretary for Educational and Cultural Affairs Department of State. [FR Doc. E6-5283 Filed 4-10-06; 8:45 am] BILLING CODE 4710-05-P DEPARTMENT OF STATE [Public Notice 5272] Culturally Significant Objects Imported for Exhibition Determinations: “Bellini, Giorgione, Titian, and the Renaissance of Venetian Painting” SUMMARY: Notice is hereby given of the following determinations: Pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681, *et seq.* ; 22 U.S.C. 6501 note, *et seq.* ), Delegation of Authority No. 234 of October 1, 1999, Delegation of Authority No. 236 of October 19, 1999, as amended, and Delegation of Authority No. 257 of April 15, 2003 [68 FR 19875], I hereby determine that the objects to be included in the exhibition “Bellini, Giorgione, Titian, and the Renaissance of Venetian Painting,” imported from abroad for temporary exhibition within the United States, are of cultural significance. The objects are imported pursuant to loan agreements with the foreign owners or custodians. I also determine that the exhibition or display of the exhibit objects at the National Gallery of Art, from on or about June 18, 2006, until on or about September 17, 2006, and at possible additional venues yet to be determined, is in the national interest. Public Notice of these Determinations is ordered to be published in the **Federal Register** . FOR FURTHER INFORMATION CONTACT: For further information, including a list of the exhibit objects, contact Paul Manning, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202/453-8052). The address is U.S. Department of State, SA-44, 301 4th Street, SW., Room 700, Washington, DC 20547-0001. Dated: April 3, 2006. C. Miller Crouch, Principal Deputy Assistant Secretary for Educational and Cultural Affairs Department of State. [FR Doc. E6-5284 Filed 4-10-06; 8:45 am] BILLING CODE 4710-05-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration Notice of Intent To Rule on Request To Release Airport Property at the Jeffco Airport, Broomfield, CO AGENCY: Federal Aviation Administration (FAA), DOT. ACTION: Notice of request to release airport property. SUMMARY: The FAA proposes to rule and invite public comment on the release of land at the Jeffco Airport under the provisions of Section 125 of the Wendell H. Ford Aviation Investment Reform Act for the 21st Century (AIR 21). DATES: Comments must be received on or before May 11, 2006. ADDRESSES: Comments on this application may be mailed or delivered to the FAA at the following address: Mr. Craig Sparks, Manager, Federal Aviation Administration, Northwest Mountain Region, Airports Division, Denver Airports District Office, 26805 E. 68th Ave., Suite 224, Denver, Colorado 80249. In addition, one copy of any comments submitted to the FAA must be mailed or delivered to Mr. Kenneth E. Maenpa, Airport Manager, Jeffco Airport, 11755 Airport Way, Terminal Building, Broomfield, Colorado 81021. FOR FURTHER INFORMATION CONTACT: Ms. Cynthia Nelson, Project Manager, Federal Aviation Administration, Northwest Mountain Region, Airports Division, Denver Airports District Office, 26805 E. 68th Ave., Suite 224, Denver, Colorado 80249. The request to release property may be reviewed in person at this same location. SUPPLEMENTARY INFORMATION: The FAA invites public comment on the request to release property at the Jeffco Airport under the provisions of the AIR 21. On March 27, 2006, the FAA determined that the request to release property submitted by the Jeffco Airport met the procedural requirements of the Federal Aviation Regulations, Part 155. The FAA may approve the request, in whole or in part, no later than June 30, 2006. The following is a brief overview of the request: The Jeffco Airport requests the release of 1.552 acres of non-aeronautical airport property to the Colorado Department of Transportation. The purpose of this release is to allow the Jeffco Airport to sell the subject land that is needed for a right-of-way for highway intersection improvements. The sale of this parcel will provide funds for airport improvements. Any person may inspect the request by appointment at the FAA office listed above under FOR FURTHER INFORMATION CONTACT . In addition, any person may, inspect the application, notice and other documents germane to the application in person at Jeffco Airport, 11755 Airport Way, Terminal Building, Broomfield, Colorado 81021. Issued in Denver, Colorado, on March 27, 2006. Craig Sparks, Manager, Denver Airports District Office. [FR Doc. 06-3421 Filed 4-10-06; 8:45 am]
Connectionstraces to 12
Traces to 12 documents
U.S. Code
- Registration, responsibilities, and oversight of self-regulatory organizations§ 78s
- Definitions and application§ 78c
- Public information; agency rules, opinions, orders, records, and proceedings§ 552
- National securities exchanges§ 78f
- Immunity from seizure under judicial process of cultural objects imported for temporary exhibition or display§ 2459
- Purposes§ 6501
CFR
register
public-private-law
3 references not yet in our index
- 17 CFR 240.19
- 15 USC 78
- 79 Stat. 985
Citation graph
cites case law
Notices
Notice and request for comments
Cite17 CFR 240.19
Cite15 USC 78
Stat.79 Stat. 985
Cites 15 · showing 12Cited by 0 across 0 sources