48332 Federal Register / Vol. 62, No. 178 / Monday, September 15, 1997 / Notices

7 17 CFR 240.19b–4(e)(4).

8Securities Exchange Act Release No. 38950

(August 19, 1997), 62 FR 44997.

9 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 38808 (July

1, 1997), 62 FR 37111 (July 10, 1997).

4See letter from Michele R. Weisbaum, Vice

President and Associate General Counsel, Phlx to

David Sieradzki, Attorney, SEC, dated August 6,

1997 (‘‘Amendment No. 1’’). In Amendment No. 1,

the Phlx proposed to amend Option Floor

Procedure Advice B–7, Time Priority of Bids/Offers

in Foreign Currency Options, to delete text

describing the enhanced specialist split for 3D

options.

5 3D FCOs are cash-settled, European-style, cash/

spot FCO contracts on the German mark that trade

in one-week and two-week expirations. See

Securities Exchange Act Release No. 33732 (Mar. 8,

1994), 59 FR 12023 (Mar. 15, 1994).

6See Securities Exchange Act Release No. 35177

(Dec. 29, 1994), 60 FR 2419 (Jan 9, 1995) (‘‘Original

Split Approval Order’’).

7See letter from Michele R. Weisbaum, Vice

President and Associate General Counsel, Phlx to

David Sieradzki, Attorney, SEC, dated June 30, 1997

(‘‘Phlx Letter’’).

8Telephone conversation between Michele R.

Weisbaum, Vice President and Associate General

Counsel, Phlx, James T. McHale, Special Counsel,

SEC and David Sieradzki, Attorney, SEC (June 19,

1997). Rule 1014(h) provides that ‘‘[t]his enhanced

split will not apply where a customer bid/offer for

under 100 contracts has time priority.’’

9The Exchange represents that it is in the process

of considering new and different types of parity

splits that, if adopted, would be applicable to all

products traded by specialists on the foreign

currency option floor or at least to a broader range

of specialist traded products. See Phlx Letter, supra

note 7.

10 15 U.S.C. 78f(b).

11 15 U.S.C. 78f(b)(5).

to Rule 19b–4(e)(4) 7 promulgated

thereunder because the proposal effects

a change in an existing service of a

registered clearing agency that does not

adversely affect the safeguarding of

securities or funds in the custody or

control of DTC or for which it is

responsible and does not significantly

affect the respective rights or obligations

of DTC or persons using the service. At

any time within sixty days of the filing

of such 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.

On August 25, 1997, notice of filing

of File No. SR–DTC–97–07 was

incorrectly published in the Federal

Register as a proposed rule change filed

pursuant to Section 19(b)(2).8 This

notice of the proposed rule change

supersedes that release and correctly

publishes notice of filing of File No. SR–

DTC–97–07 as a proposed rule change

filed pursuant to Section 19(b)(3)(A).

The proposed rule change became

immediately effective upon filing with

the Commission on May 19, 1997.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, NW.,

Washington, DC 20549. 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

Section, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such

filing also will be available for

inspection and copying at the principal

office of DTC. All submissions should

refer to File No. SR–DTC–97–07 and

should be submitted by October 6, 1997.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.9

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–24303 Filed 9–11–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39030; File No. SR–PHLX–

97–25]

Self-Regulatory Organizations;

Philadelphia Stock Exchange, Inc.;

Order Granting Approval to Proposed

Rule Change and Notice of Filing and

Order Granting Accelerated Approval

of Amendment No. 1 Thereto, Relating

to Elimination of the Enhanced Parity

Split for the Specialist in the 3D

German Mark Foreign Currency

Options

September 8, 1997.

I. Introduction

On May 29, 1997, the Philadelphia

Stock Exchange, Inc. (‘‘Phlx’’ or

‘‘Exchange’’) submitted to the Securities

and Exchange Commission (‘‘SEC’’ or

‘‘Commission’’), 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

eliminate from Exchange Rule 1014(h)

(‘‘Rule’’) the enhanced parity split for

the specialist in the dollar denominated

delivery German Mark (‘‘3D’’) foreign

currency options (‘‘FCOs’’).

The proposed rule change was

published for comment in the Federal

Register on July 10, 1997.3 No

comments were received on the

proposal. On August 6, 1997, the Phlx

submitted Amendment No. 1 to the

proposed rule change.4 This order

approves the proposal as amended.

II. Description of the Proposal

In January, 1995, the Exchange

amended the Rule to adopt an enhanced

split for its specialist in 3D FCOs 5 in

order to encourage the specialist to

make deeper markets to attract order

flow.6 The Rule provides that the

Foreign Currency Option Committee

(‘‘the Committee’’) would conduct a

review of the entitlement to the

enhanced parity split at the end of the

first year and then every 6 months

thereafter. Pursuant to the most recent

review, the Committee determined to

eliminate the enhanced split which was

only applicable to this one product

traded on the Foreign Currency Option

Floor of the Exchange. The specialist in

the product has not objected to the

elimination of the enhanced split. In

fact, the specialist firm trading this

product has indicated that enhanced

split is not particularly useful to the

firm and that the firm does not generally

take advantage of it.7 In addition, the

Exchange has represented that the order

size in this product is generally not

large enough to trigger the enhanced

split.8 Although the Exchange is

proposing to eliminate the enhancement

at this time, it represents it is continuing

to study the potential use of enhanced

splits for the Foreign Currency Option

Floor on a broader basis.9 By

eliminating the current enhanced split,

parity and priority will be determined

in accordance with Exchange Rule 119

and the remainder of section (h) to Rule

1014.

III. Discussion

The Commission finds that the

proposed rule change is consistent with

the requirements of the Act and the

rules and regulations thereunder

applicable to a national securities

exchange, and, in particular, with the

requirements of Section 6(b).10

Specifically, the Commission believes

the proposal is consistent with the

Section 6(b)(5) 11 requirements that the
Federal Register / Vol. 62, No. 178 / Monday, September 15, 1997 / Notices 48333

12 In approving this rule, the Commission has

considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

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

13See Original Split Approval Order, supra note

6.

14 15 U.S.C. 78s(b)(2).

15 17 CFR 200.30–3(a)(12).

rules of an exchange be designed to

promote just and equitable principles of

trade, to prevent fraudulent and

manipulative acts, and, in general, to

protect investors and the public

interest.12

The Exchange has represented that

the enhanced parity split for 3D FCOs

is not frequently used and has not

served as an effective means of

attracting order flow to the Exchange.

When the enhanced parity split for 3D

FCOs was initially approved, the

Commission stated that it was

reasonable for the Exchange to grant

these benefits to specialists as long as

they did not unreasonably restrain

competition or harm investors. In

addition, the Commission believed that

granting these benefits to specialists was

within the business judgement of the

Exchange.13 Similarly, the Commission

believes that it is within the business

judgement of the Exchange to eliminate

these benefits to specialists, provided

that competition is not unreasonably

restrained nor investors harmed.

Accordingly, the Commission believes

that it is reasonable for the Exchange to

rescind the enhanced parity split and

examine other potential methods of

attracting order flow to the Exchange.

The Commission finds good cause for

approving Amendment No. 1 to the

proposed rule change prior to the

thirtieth day after the date of

publication of notice of filing thereof in

the Federal Register. Amendment No. 1

does not change the nature of the

proposal, but merely conforms Options

Floor Procedure Advice B–7 to reflect

the elimination of the enhanced

specialist split for 3D FCOs. Further, the

Commission notes that the original

proposal was published for the full 21-

day comment period and no comments

were received by the Commission.

Accordingly, the Commission believes it

is appropriate to approve Amendment

No. 1 to the Exchange’s proposal on an

accelerated basis.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views and

arguments concerning Amendment No.

1. Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, NW.,

Washington, DC 20549. 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 at

the Commission’s Public Reference

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the abovementioned self-regulatory organization.

All submissions should refer to File No.

SR–Phlx–97–25 and should be

submitted by October 6, 1997.

V. Conclusion

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,14 that the

proposed rule change (SR–Phlx–97–25)

is approved, as amended.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.15

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–24304 Filed 9–12–97; 8:45 am]

BILLING CODE 8010–01–M

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[Finance Docket No. 32760]

Union Pacific Railroad Company—

Control and Merger—Southern Pacific

Transportation Company: Reno

Mitigation Study, Preliminary

Mitigation Plan

AGENCY: Surface Transportation Board,

Transportation.

ACTION: Issuance of Preliminary

Mitigation Plan (PMP), request for

public comment, and notice of public

meetings.

SUMMARY: The Surface Transportation

Board’s (Board) Section of

Environmental Analysis (SEA) will

issue the Preliminary Mitigation Plan

(PMP) for the Reno, NV Mitigation

Study on September 15, 1997, for public

review and comment. On August 12,

1996, in Decision No. 44, the Board

approved the Union Pacific/Southern

Pacific merger. As part of its approval,

the Board directed SEA to conduct a

mitigation study to develop additional

tailored environmental mitigation

measures (beyond those already

imposed in Decision No. 44) to address

unique local conditions in Reno and

Washoe County regarding the potential

environmental impacts of increased rail

traffic. The preliminary results of this

study and SEA’s preliminary

recommendations for additional

environmental mitigation measures are

reflected in the PMP. SEA encourages

public comment on the PMP during the

30-day review period, which will end

on October 15, 1997. SEA will distribute

copies of the PMP to interested parties.

In addition, copies of the PMP will be

available at the Reno and Sparks

branches of the Washoe County Public

Library, or by request by calling (202)

565–1539.

SEA will hold two public information

meetings on October 9, 1997, to provide

the public with further opportunity to

comment on the PMP and receive

additional information. SEA will

consider all public comments and issue

a Final Mitigation Plan (FMP) for public

review and comment. Based on the

PMP, FMP, and public comments, SEA

will then make its final

recommendations to the Board. The

public information meetings will be

held on October 9, 1997, at Reno City

Hall, 490 South Center Street, Reno, NV.

The afternoon meeting will include an

informal open house from 1:30 p.m.–

2:30 p.m., followed by a presentation

and formal public meeting beginning at

2:30 p.m. The evening meeting will

include an informal open house from

6:00 p.m.–7:00 p.m., and a formal public

meeting beginning at 7:00 p.m.

Public comments should be submitted

in writing (one original plus 10 copies),

no later than October 15, 1997, to: Office

of the Secretary, Case Control Unit,

Finance Docket No. 32760, Surface

Transportation Board, 1925 K Street,

NW., Washington, DC 20423–0001.

Mark the lower left hand corner of the

envelope: Attention: Elaine K. Kaiser,

Chief, Section of Environmental

Analysis, Environmental Filing—Reno.

FOR FURTHER INFORMATION CONTACT:

Harold McNulty, Section of

Environmental Analysis, Room 500,

Surface Transportation Board, 1925 K

Street, NW., Washington, DC 20423,

(202) 565–1539, TDD for the hearing

impaired: (202) 565–1695.

By the Board, Elaine K. Kaiser, Chief,

Section of Environmental Analysis.

Vernon A. Williams,

Secretary.

[FR Doc. 97–24406 Filed 9–12–97; 8:45 am]

BILLING CODE 4915–00–P