31622 Federal Register / Vol. 65, No. 97 / Thursday, May 18, 2000 / Notices

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

2 17 CFR 240.19b–4.

3See Letter from Cindy Hoekstra, Counsel, Phlx,

to Nancy Sanow, Assistant Director, Division of

Market Regulation, Commission, dated May 2, 2000

(‘‘Amendment No. 1’’). Amendment No. 1 defines

the term ‘‘owner’’ for purposes of the Certificate of

Incorporation. Because of the substantive nature of

the amendment, the Commission deems the filing

date of the proposed rule change to be the date the

amendment was filed, May 3, 2000.

4The Commission approved the proposed rule

change adopting Article Twentieth. See Securities

Exchange Act Release No. 42317 (January 5, 2000),

65 FR 2215 (January 13, 2000) (SR–Phlx–99–48).

5See e.g., Phlx By-Law, Article I, Section 1–1(f):

‘‘The term ‘lessor’ means a holder of equitable title

to a membership in the Exchange, including a

former member of the Exchange, who has leased

legal title to his membership to a lessee and has

retained equitable title to such membership.’’ See

also Phlx Rule 17.

6The parties to an A-B-C Agreement are an

employee, general partner, or officer, and the

member organization with which such person is

associated. See Phlx Rule 940.

7See e.g. Phlx Rules 17 and 940.

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42773; File No. SR–Phlx–

00–30]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Philadelphia Stock Exchange, Inc.

Amending the Exchange’s Certificate

of Incorporation

May 11, 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 10,

2000, the Philadelphia Stock Exchange,

Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with

the Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’)

the proposed rule change as described

in Items I, II, III, below, which Items

have been prepared by the Exchange.

On May 3, 2000, the Phlx filed

Amendment No. 1 to the proposed rule

change.3 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 Phlx proposes to amend Article

Twentieth of its Certificate of

Incorporation to add the words ‘‘owner’’

and ‘‘member organization’’ to the text

of Article Twentieth and define the term

‘‘owner.’’ 4 Article Twentieth authorizes

the Phlx Board of Governors (‘‘Board’’)

to (1) assess fees, dues, and other

charges upon members, lessors and

lessees of memberships, and holders of

permits as the Board may adopt by

resolution or set forth in the Rules of the

Board, and (2) assess penalties for

failure to pay any fees, dues, or other

charges owed to the Exchange,

including cancellation of a membership

or permit and forfeiture of all rights as

a member, lessor, lessee, or holder of a

permit. Under Article Twentieth the

Board may delegate its powers with

respect to the assessment of fees, dues,

other charges, and penalties to any

committee of the Board or the Chairman

of the Board. Article Twentieth also

provides that fees, dues, other charges,

and penalties authorized under the

Article are in addition to any fees, dues,

other charges or penalties imposed

under the By-Laws of the Phlx.

The proposed amendment to Article

Twentieth adds ‘‘owners’’ and ‘‘member

organizations’’ to the categories that will

be subject to the Board’s authority to

assess fees, dues, and other charges. In

addition, the amendment defines the

term ‘‘owner’’ for purposes of the Phlx’s

Certificate of Incorporation and rules.

As proposed, ‘‘owner’’ is defined as any

person or entity who or which is a

holder of equitable title to a

membership in the Phlx.

The Exchange represents that

‘‘owners’’ and ‘‘member organizations’’

are implicitly covered under the current

text of Article Twentieth; however, the

Exchange believes that a direct reference

to owners and member organizations

will nevertheless help clarify matters

relating to the interpretation of those

terms. For example, a leasing agreement

may expire, resulting in a situation

where an owner who formerly leased its

membership is not currently leasing that

membership. The Exchange believes

that the owner remains classified as a

‘‘lessor’’ even though the membership

currently is not leased,5 and, therefore,

would be included in the current classes

specified in Article Twentieth.

However, the Exchange believes it is in

the best interests of the members,

owners and the Exchange to clarify the

original intent of Article Twentieth by

expanding the classes to include

‘‘owners.’’

The Exchange also believes that it is

desirable to clarify that ‘‘member

organizations’’ are intended to be within

the scope of entities subject to fees,

dues, and other charges imposed

pursuant to Article Twentieth. For

example, although member

organizations are ‘‘owners’’ for purposes

of Article Twentieth, there may be

situations where the Exchange may

wish to charge fees, dues, or other

charges under Article Twentieth that

affect certain classes of owners, such as

member organizations, but not others. In

such circumstances, an explicit

reference to member organizations in

Article Twentieth would be helpful.

II. Self-Regulatory Organization’s

Statement Regarding the Purpose of,

and the 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 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. 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 purpose of the proposed rule

change is to amend the Exchange’s

Certificate of Incorporation to

specifically permit the Board to impose

fees, dues, and other charges upon

‘‘member organizations’’ and ‘‘owners.’’

The proposed rule change clarifies the

Board’s authority to allocate dues, fees,

and other charges among the Exchange’s

various constituents, thereby ensuring

appropriate distribution of costs relating

to maintaining and enhancing the

competitive operations of the Exchange.

In addition, the amendment defines

the term ‘‘owner’’ for purposes of the

Exchange’s Certificate of Incorporation

and rules as any person or entity who

or which is a holder of equitable title to

a membership in the Exchange. The

term ‘‘owner’’ is intended to encompass

lessors and member organizations who

are parties to A-B-C Agreements.6

Lessors and member organizations that

have provided all or part of the funds

for the purchase of a membership

pursuant to an A-B-C Agreement, are

sometimes referred to in the Certificate

of Incorporation and rules of the

Exchange as holders of equitable title.7

Therefore, defining the term ‘‘owner’’ as

a holder of equitable title is consistent

with the provisions relating to lessors

and member organizations who are

parties to A-B-C Agreements (both of

whom are types of owners) and should

Federal Register / Vol. 65, No. 97 / Thursday, May 18, 2000 / Notices 31623

8 15 U.S.C. 78f(b).

9 15 U.S.C. 78(b)(4).

10 15 U.S.C. 78s(b)(3)(A).

11 17 CFR 240.19b–4(f)(6).

12 17 CFR 240.19b–4(f)(6)(iii).

13See Securities Exchange Act Release No. 42714

(April 24, 2000), 65 FR 25782 (May 3, 2000).

14Telephone conversation between Cindy

Hoekstra, Counsel, Phlx, and Marla Chidsey,

Attorney, Division of Market Regulation,

Commission (May 11, 2000).

15 17 CFR 240.19b–4(f)(6)(iii). For purposes only

of accelerating the operative date of this proposal,

the Commission has considered the proposed rule’s

impact on efficiency, competition, and capital

formation. 15 U.S.C. 78c(f). 16 17 CFR 240.19b–4(f)(6)(iii).

provide consistency throughout the

Phlx’s Certificate of Incorporation and

rules.

2. Statutory Basis

For these reasons, the Exchange

believes that the proposed rule change

is consistent with section 6(b) of the

Act 8 in general, and with Section

6(b)(4) 9 in particular in that it provides

for the equitable allocation of reasonable

dues, fees and other charges.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange believes that the

proposed rule imposes no inappropriate

burden on competition.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

The Exchange has neither solicited

nor received written comments on the

proposed rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The proposed rule change has been

filed by the Exchange pursuant to

Section 19(b)(3)(A) of the Act 10 and

Rule 19b–4(f)(6) thereunder.11 The

Exchange represents that the proposed

rule change:

‘‘(i) Does not significantly affect the

protection of investors or the public interest;

(ii) Does not impose any significant burden

on competition; and

(iii) Does not become operative for 30 days

after the date of the filing, or such shorter

time as the Commission may designate if

consistent with the protection of investors

and the public interest; provided that the

Exchange has given the Commission written

notice of its intent to file the proposed rule

change at least five business days prior to the

date of filing of the proposed rule change, or

such shorter time as designated by the

Commission.’’ 12

The Exchange has requested that the

Commission accelerate the operative

date of the proposal. In addition, the

Exchange provided the Commission

with written notice of its intent to file

the proposed rule change, along with a

brief description of the proposed rule

change, more than five business days

prior to the date of filing the proposed

rule change.

The Exchange represents that the

operative date of this proposed rule

change should be accelerated because

the Exchange intends to implement the

monthly capital funding fee on all seat

owners as part of a long term financing

plan.13 Prior to implementing this fee,

the Exchange wants to ensure that it is

clear exactly who will be subject to the

fee by amending Article Twentieth to

add the two categories, ‘‘owner’’ and

‘‘member organization,’’ and defining

‘‘owner.’’ 14

The Commission finds that it is

appropriate to designate this proposal to

become operative today because such

designation is consistent with the

protection of investors and the public

interest.15 Specifically, the Commission

believes that adding the two additional

categories and defining ‘‘owner’’ will

clarify the original intent of Article

Twentieth, and that it is appropriate to

accelerate the operative date of the

proposed rule change.

IV. Solicitation of Comments

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.

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, 450 Fifth Street NW, Washington

DC 20549. Copies of such filing will also

be available for inspection and copying

at the principal office of the Phlx. All

submissions should refer to File No.

SR–Phlx–00–30 and should be

submitted by June 8, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.16

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–12515 Filed 5–17–00; 8:45 am]

BILLING CODE 8010–01–M

DEPARTMENT OF STATE

[Public Notice #3281]

Shipping Coordinating Committee

Council and Technical Cooperation

Committee; Notice of Meeting

The Shipping Coordinating

Committee (SHC) will conduct an open

meeting at 10:30 a.m. on Thursday, 1

June 2000, in Room 6319, at U. S. Coast

Guard Headquarters, 2100 Second

Street, SW, Washington, DC 20593–

0001. The purpose of the meeting is to

finalize preparations for the 84th

session of Council and the 48th Session

of the Technical Cooperation Committee

of the International Maritime

Organization (IMO) which is scheduled

for 12–16 June 2000, at the IMO

Headquarters in London. Discussions

will focus on papers received and draft

U.S. positions.