26254 Federal Register / Vol. 65, No. 88 / Friday, May 5, 2000 / Notices

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

2 17 CFR 240.19b–4.

3 15 U.S.C. 78s(b)(3)(A).

4 17 CFR 240.19b–4(f)(6).

5The Exchange provided written notice to the

Commission on April 20, 2000, that it intended to

file this proposal. See Rule 19b–4(f)(6)(iii). 17 CFR

240.19b–4(f)(6)(iii).

exemption from the provisions of

section 22(c) and Rule 22c–1 to the

extent deemed necessary to permit them

to recapture the Credit Enhancement

that is or will be made available under

the Variable Contracts and Future

Variable Contracts.

Conclusion

Applicants submit that their request

for an order for the exemptive relief

described above is appropriate in the

public interest and consistent with the

protection of investors and the purposes

fairly intended by the policy and

provisions of the 1940 Act, and that,

therefore, the Commission should grant

the requested order.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Jonathan G. Katz,

Secretary.

[FR Doc. 00–11224 Filed 5–5–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42732; File No. SR–Amex–

00–24]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

American Stock Exchange LLC

Relating to Rule 2(a) of the Rules of

Procedure Applicable to Exchange

Disciplinary Proceedings

April 28, 2000.

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 April 27,

2000, the American Stock Exchange LLC

(‘‘Amex’’ or ‘‘Exchange’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’ or ‘‘SEC’’) the proposed

rule change as described in Items I, II

and III below, which Items have been

prepared by the Exchange. The

Exchange filed the proposal pursuant to

Section 19(b)(3)(A) of the Act,3 and Rule

19b–4(f)(6) thereunder,4 which renders

the proposal effective upon filing with

the Commission.5 The Commission is

publishing this notice to solicit

comments on the proposed rule change

from interested persons.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The Exchange proposes to amend

Rule 2(a) of the Rules of Procedure

Applicable to Exchange Disciplinary

Proceedings for purposes of authorizing

the Chief Hearing Officer (or the Deputy

Chief Hearing Officer) at the National

Association of Securities Dealers

Regulation, Inc. (‘‘NASDR’’) Office of

Hearing Officers to appoint NASDR

hearing officers to act as Chairmen of

Amex disciplinary panels. The text of

the proposed rule change is below. New

language is italics.

K. Exchange Disciplinary Proceedings

Rule

Rule 02(a). Selection of Hearing Officers

Whenever the Chairman of the Exchange

shall be advised that a charge or charges have

been served upon a member, member

organization, approved person, or a

registered or non-registered employee or

prospective employee of a member or

member organization, or that a written

stipulation of facts and consent to a specified

penalty has been entered into between any

such person or persons and an officer of the

Exchange, or that a member or member

organization has been suspended or expelled

from any other securities exchange or any

national securities association, or has been

suspended or barred from being associated

with any member of such exchange or

association, or has been suspended or barred

by any governmental securities agency from

dealing in securities or being associated with

any broker or dealer in securities and such

member or member organization has not

consented in writing to similar action by the

Exchange, or that an employee or prospective

employee of a member or member

organization has been suspended or expelled

from any other securities exchange or any

national securities association, or has been

suspended or barred from being associated

with any member of such exchange or

association, or has been suspended or barred

by any governmental securities agency from

dealing in securities or being associated with

any broker or dealer in securities and such

employee or prospective employee has not

consented in writing to similar action by the

Exchange, the Chairman, (or such person(s)

as the Chairman may designate with Board

approval), shall select, from among hearing

officers appointed to serve on Exchange

Disciplinary Panels, one such hearing officer

to act as a chairman of a Disciplinary Panel

which shall conduct a hearing with respect

to such matter and take such action as may

be authorized pursuant to the Constitution

and rules of the Exchange.

* * * * *

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

its proposal and discussed any

comments it received regarding the

proposal. The text of these statements

may be examined at the places specified

in Item IV below. The Amex 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

Under Article V, Section 1(b)(2) of the

Amex Constitution, the Chairman of the

Board, subject to the approval of the

Board, designates Exchange Officials

and other persons to serve on the

Hearing Board. Those who are

designated to serve on the Hearing

Board make up a pool of persons who

can be asked to serve as members of

disciplinary panels in Exchange

disciplinary proceedings. Under Article

V, Section 1(b)(3), the Chairman, again

subject to Board approval, designates

one or more hearing officers, who have

no Exchange duties or functions relating

to the investigation or preparation of

disciplinary matters, to act as Chairmen

of Amex disciplinary panels.

These two pools of people (i.e., the

people who serve as members of

disciplinary panels, and the people who

act as Chairmen of the disciplinary

panels) are approved on an annual basis

at the Board’s organization meeting each

January. Rule 2(a) of the Rules of

Procedure Applicable to Exchange

Disciplinary Proceedings then requires

the Amex Chairman, each time an Amex

disciplinary proceeding is initiated, to

select the specific hearing officer that

will chair that particular Amex

disciplinary panel.

Last year, the Amex entered into a

formal agreement with the National

Association of Securities Dealers

(‘‘NASD’’) under which the NASDR’s

Office of Hearing Officers provides

hearing officers to chair all Amex

disciplinary panels. The hearing officers

are responsible for fulfilling the panel

chair’s duties as set forth in the Amex

Constitution and Rules. The NASD has

followed the above described procedure

under Rule 2(a) with respect to the

selection of a hearing officer to chair

each Amex disciplinary panel, obtaining

the approval of the Amex Chairman in

each instance.

Amex proposes to amend Rule 2(a) to

expedite the selection process by

authorizing the Amex Chairman, or

such person(s) as the Chairman may

designate with Board approval, to

Federal Register / Vol. 65, No. 88 / Friday, May 5, 2000 / Notices 26255

6 15 U.S.C. 78f(b).

7 15 U.S.C. 78f(b)(6).

8 15 U.S.C. 78s(b)(3)(A).

9 17 CFR 240.19b–4(f)(6).

10 In reviewing this rule, the Commission has

considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

U.S.C. 78c(f).

11 17 CFR 200.30–3(a)(12).

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

2Securities Exchange Act Release No. 42279,

(December 28, 1999), 65 FR 541.

3 In 1998, GSCC’s board of directors requested

that GSCC explore the possibility of providing in

Europe the types of comparison, netting, and risk

management services that GSCC provides in the

United States. GSCC originally planned to provide

these services through a joint venture with

Euroclear and its operator Morgan Guaranty Trust

Company of New York, Brussels Branch.

Specifically, GSCC and Euroclear had planned to

use J.P. Morgan Benelux, S.A., an existing Morgan

subsidiary, as the netting vehicle that would have

been renamed the European Securities Clearing

Corporation. In a separate development, LCH was

also asked by its members to provide these same

services in Europe. In response, in April 1999 LCH

began offering its RepoClear service through which

LCH provides netting services for European

sovereign debt repo transactions. To achieve greater

efficiency, GSCC, Euroclear, and LCH have agreed

that it would be more efficient to provide the

services for European sovereign debt purchases and

repo transactions through a single netting vehicle,

RepoClear.

4 In accordance with the agreement between

GSCC, Euroclear, and LCH, LCH will transfer

control of RepoClear to ESCC. For a description of

LCH’s RepoClear, see note 3.

appoint in each instance the specific

hearing officer that will chair each

Amex disciplinary panel. The Amex

Board has approved this amendment

and specifically authorized the Chief

Hearing Officer (or the Deputy Hearing

Officer) at the NASDR’s Office of

Hearing Officers, as the Amex

Chairman’s designee, to appoint NASDR

hearing officers to chair Amex

disciplinary panels. The Exchange is

amending Rule 2(a) for the sole purpose

of streamlining the process for selecting

hearing officers. The Exchange believes

the amendment will provide for more

efficient administration of Amex

disciplinary proceedings.

2. Statutory Basis

The Exchange believes that the

proposal is consistent with Section 6(b)

of the Act 6 in general and furthers the

objectives of Section 6(b)(6) 7 in

particular in that it is intended to assure

that Exchange members and member

firms are appropriately disciplined for

rule violations.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

Amex believes the proposed rule

change will impose no burden on

competiton.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

No written comments were solicited

or received with respect to the proposed

rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Because the foregoing proposed rule

change does not:

(i) Significantly affect the protection

of investors or the public interest;

(ii) Impose any significant burden on

competition; and

(iii) Become operative for 30 days

from the date on which it was filed, or

such shorter time as the Commission

may designate, it has become effective

pursuant to section 19(b)(3)(A) of the

Act 8 and Rule 19b–4(f)(6) thereunder.9

At any time within 60 days of the filing

of the proposed rule change, the

Commission may summarily abrogate

such rule change if it appears to the

Commission that such action is

necessary or appropriate in the public

interest, for the protection of investors,

or otherwise in furtherance of the

purposes of the Act.10

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing,

including whether the proposal is

consistent with the Act. Persons making

written submissions should file six

copies thereof with the Secretary,

Securities and Exchange Commission,

450 Fifth Street NW, Washington, DC

20549–0609. Copies of the submission,

all subsequent amendments, all written

statements with respect to the proposed

rule change that are filed with the

Commission, and all written

communications relating to the

proposed rule change between the

Commission and any person, other than

those that may be withheld from the

public in accordance with the

provisions of 5 U.S.C. 552, will be

available for inspection and copying in

the Commission’s Public Reference

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the Amex. All

submissions should refer to file number

SR–Amex–00–24 and should be

submitted by May 26, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Jonathan G. Katz,

Secretary.

[FR Doc. 00–11227 Filed 5–4–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42729; File No. SR–GSCC–

99–05]

Self-Regulatory Organizations;

Government Securities Clearing

Corporation; Order Granting Approval

of a Proposed Rule Change Relating to

the Formation of the European

Securities Clearing Corporation

April 28, 2000.

On November 16, 1999, the

Government Securities Clearing

Corporation (‘‘GSCC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) a proposed rule change

(File No. SR–GSCC–99–05) pursuant to

section 19(b)(1) of the Securities

Exchange Act of 1934 (‘‘Act’’).1 Notice

of the proposal was published in the

Federal Register on January 5, 2000.2

No comment letters were received. For

the reasons discussed below, the

Commission is granting approval of the

proposed rule change.

I. Description

Under the rule change, GSCC seeks

Commission approval to become an

initial shareholder and to serve on the

board of directors of the European

Securities Clearing Corporation

(‘‘ESCC’’). ESCC will be a new entity

formed under the laws of the United

Kingdom by GSCC, the Euroclear

Clearance System Societe Cooperative

(‘‘Euroclear’’), and the London Clearing

House (‘‘LCH’’). ESCC will be owned

equally by GSCC, Euroclear, and LCH.3

ESCC’s main role will be to oversee

the scope and nature of the netting

services being offered through LCH’s

RepoClear.4 It is intended that ESCC

will be governed by its market

participant users, which are expected to

be major participants in the European

fixed-income marketplace. GSCC’s

involvement in ESCC will be a

governance role that should help

ensure, among other things, that

RepoClear will draw upon GSCC’s

experience and knowledge and will

have United States-style features such as

single-ticket data input, settlement of

contracts at current market value, the

facilitation of substitutions, and the

admission of inter-dealer brokers.

GSCC’s role in ESCC will further help

to ensure that the RepoClear service will

use, to the extent appropriate, GSCC’s

mark-to-market and margining

methodologies to provide

comprehensive, uniform risk