[Federal Register Volume 65, Number 88 (Friday, May 5, 2000)]
[Notices]
[Pages 26254-26255]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-11227]


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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.
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    \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).
    \5\ The 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).
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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

[[Page 26255]]

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.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(6).
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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\
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    \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).
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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\
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    \11\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 00-11227 Filed 5-4-00; 8:45 am]
BILLING CODE 8010-01-M