[Federal Register Volume 65, Number 113 (Monday, June 12, 2000)]
[Notices]
[Pages 36879-36880]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-14728]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 42898; File No. SR-Phlx-00-41]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Philadelphia Stock 
Exchange, Inc. Extending the Pilot Program Regarding Exchange Rule 98, 
Emergency Committee, Until August 21, 2000

June 5, 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 18, 2000, the Philadelphia Stock Exchange, Inc. (``Phlx'' or 
``Exchange''), filed a proposed rule change with the Securities and 
Exchange Commission (``SEC'' or ``Commission''). The proposed rule 
change is described in Items I, II, and III below, which Items have 
been prepared by the Exchange. On April 20, 2000, the Exchange filed 
Amendment No. 1 to the proposed rule change.\3\ The Exchange filed the 
proposed rule change, as amended, pursuant to Section 19(b)(3)(A) of 
the Act,\4\ and Rule 19b-4(f)(6) thereunder,\5\ which renders the 
proposed rule change effective upon filing with the Commission. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.16b-4.
    \3\ See April 19, 2000 letter from Richard S. Rudolph, Counsel, 
Exchange, to Rebekah Liu, Special Counsel, Division of Market 
Regulation, SEC (``Amendment No. 1'' ). In Amendment No. 1, the 
Exchange requested that the proposed rule change be filed under 
Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder. 15 
U.S.C. 78s(b)(3)(A) and 17 CFR 240.19b-4(f)(6). The Exchange also 
requested that the Commission waive the 5-day notice of its intent 
to file the proposal, and requested that the Commission waive the 
30-day period before the proposal becomes effective to permit the 
proposed rule change to become immediately effective.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange is proposing to extend the pilot program relating to 
Exchange Rule 98, Emergency Committee, for an additional 120 days, or 
until August 21, 2000. No changes to the existing rule language are 
being proposed.

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, as 
amended, 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
    On December 23, 1999, the Commission granted approval to amendments 
to Exchange Rule 98, Emergency Committee (the ``Committee'') on a 120-
day pilot basis.\6\ In general, the Committee is authorized to 
determine the existence of, and take action with respect to, 
extraordinary market conditions or other emergencies at the Exchange. 
The amendments to Exchange Rule 98 updated the composition of the 
Committee to reflect the current governance structure of the 
Exchange,\7\ clarified that the Committee was authorized to act in the 
event of any emergency condition created by the Year 200 date change, 
and deleted a provision referencing CENTRAMART, an equity order entry 
system which is no longer used on the Exchange. The Committee is now 
composed of five individuals: the Chairman of the Board of Governors; 
the On-Floor Vice Chairman of the Board of Governors;

[[Page 36880]]

and the Chairmen of the Floor Procedure Committee, the Options 
Committee, and the Foreign Currency Options Committee.
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    \6\ See Exchange Act Release No. 42272 (December 23, 1999), 65 
FR 153 (January 3, 2000) SR-Phlx-99-42).
    \7\ The amendments replaced the President, which the Exchange no 
longer has, with the On-Floor Vice Chairman of the Board of 
Governors.
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    The Commission approved the amendments to Exchange Rule 98 on a 
pilot basis in order to allow the Exchange to examine the operation of 
the Committee to ensure that the Committee is not dominated by any one 
Exchange interest (e.g., On-Floor or Off-Floor interests). The 
Commission requested that the Exchange report back to the Commission on 
its views as to whether the Committee structure ensures that all 
Exchange interests are fairly represented by the Committee. The 
Exchange has requested that the pilot program be extended in order to 
provide it more time to examine the operation of the Committee and 
submit the requested information to the Commission.
2. Statutory Basis
    The Exchange believes that the proposed rule change, as amended, is 
consistent with the provisions of Section 6(b)(5) of the Act\8\ which 
requires that the rules of an Exchange be designed to perfect the 
mechanisms of a free and open market and a national market system, and 
to protect investors and the public interest.
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    \8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change, as 
amended, will result in 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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change, as amended.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    The foregoing rule change has become effective upon filing pursuant 
to Section 19(b)(3)(A)(iii) of the Act \9\ and Rule 19b-4(f)(6) \10\ 
thereunder because the 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 after the date of filing, or such shorter time as the 
Commission may designate if consistent with the protection of investors 
and the public interest; provided the Exchange has given the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of 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. At any 
time within 60 days of the filing of a rule change pursuant to Section 
19(b)(3)(A) of the Act, the Commission may summarily abrogate the 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.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6).
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    The Commission finds that it is appropriate to accelerate the 
effective date of the proposed rule change and to permit the proposed 
rule change to become immediately effective because the proposal simply 
extends a previously approved pilot program for an additional 120 days, 
or until August 21, 2000. By extending the pilot program, the 
Commission will enable the Committee to be in place and operational in 
the event of any extraordinary market conditions or emergencies at the 
Exchange, and will afford the Exchange the opportunity to respond to 
the Commission's request to provide information on whether the 
Committee is fairly representing all interests of the Exchange.\11\
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    \11\ For purposes only of accelerating the operative date of 
this proposal, the Commission has considered its 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 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 with the 
Commission's Public Reference Room. Copies of such filing will also be 
available for inspection and copying at the principal office of the 
Exchange. All submissions should refer to the File No. SR-Phlx-00-41 
and should be submitted by July 3, 2000.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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    For the Commission, by the Division of Market Regulation, pursuant 
to delegated authority.

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 00-14728 Filed 6-9-00; 8:45 am]
BILLING CODE 8010-01-M