52170 Federal Register / Vol. 62, No. 193 / Monday, October 6, 1997 / Notices

October 1, 1997. Securities Exchange Act Release

No. 37917 (November 1, 1996), 61 FR 57934

(November 8, 1996) [File No. SR–NASD–96–41];

See also Securities Exchange Act Release No. 36171

(August 30, 1995), 60 FR 46651 (September 7, 1995)

[File No. SR–NASD–95–35]; Securities Exchange

Act Release No. 37492 (July 29, 1996), 61 FR 40963

(August 5, 1996) [File No. SR–NASD–96–30];

Securities Exchange Act Release No. 37917

(November 1, 1996), 61 FR 57934 (November 8,

1996) (File No. SR–NASD–96–41]. On August 8,

1997, the NASD submitted a proposed rule change

(SR–NASD–97–58) to the Commission to

implement the short sale rule on a permanent basis.

5A short sale is a sale of a security which the

seller does not own or any sale which is

consummated by the delivery of a security

borrowed by, or for the account of, the seller. To

determine whether a sale is a short sale, members

must adhere to the definition of a ‘‘short sale’’

contained in Securities Exchange Act Rule 3b–3, 17

CFR 240.3b–3, which rule is incorporated into

Nasdaq’s short sale rule as NASD Rule 3350(k)(l).

6Nasdaq calculates the inside bid or best bid from

all market makers in the security (including bids on

behalf of exchanges trading Nasdaq securities on an

unlisted trading privileges basis), and disseminates

symbols to denote whether the current inside bid

is an ‘‘up bid’’ or a ‘‘down bid.’’ Specifically, an

‘‘up bid’’ is denoted by a green ‘‘up’’ arrow and a

‘‘down bid’’ is denoted by a red ‘‘down’’ arrow.

Accordingly, absent an exemption from the rule, a

member cannot effect a short sale at or below the

inside bid for a security in its proprietary account

or a customer’s account if there is a red arrow next

to the security’s symbol on the screen. 7 15 U.S.C.§ 78o(b)(6) (1994).

8 17 CFR 200.30–3(a)(12) (1997).

1 15 U.S.C. § 78s(b)(1)(1994).

2 17 CFR 240.19b–4 (1997).

I. Background

The NASD’s short sale rule prohibits

member firms from effecting short

sales 5 at or below the current inside bid

as disseminated by Nasdaq whenever

that bid is lower than the previous

inside bid.6 The rule currently provides

that a short sale is a ‘‘legal’’ short sale

in a ‘‘down’’ bid situation if it is effected

at a price at least 1⁄16th above the inside

bid (‘‘Minimum Increment Rule’’). The

Minimum Increment Rule was

implemented to ensure that short sales

were not effected at prices so close to

the inside bid during down markets that

the short sales were inconsistent with

the underlying purposes of the short

sale rule (i.e. to prohibit market

destabilizing and abusive short sales in

declining markets).

Now that all Nasdaq stocks can

potentially trade with a 1⁄16th spread or

less, due to, among other things, the

new SEC Order Handling Rules, and in

light of the movement toward smaller

minimum quotation variations

generally, consideration was given to

modifying the Minimum Increment Rule

for stocks with an inside spread less

than 1⁄16th. Accordingly, the NASD is

proposing an amendment to the

Minimum Increment Rule to provide

that a ‘‘legal’’ short sale must be effected

at a price equal to or greater than the

offer price when the inside spread is

less than 1⁄16th. There would be no

change to the current definition for

stocks with a spread of 1⁄16th or greater.

For example, if the inside market for

ABCD is 101⁄4–105⁄16, a legal short sale

in a down market would have to be

effected at a price equal to or greater

than 105⁄16 (i.e., 1⁄16th above the current

inside bid). However, if the inside

market is 51⁄32–52⁄32, a legal short sale in

a down market could be effected at a

price equal to the inside offer of 52⁄32.

In addition, to help ensure that

market participants do not adjust their

quotations to circumvent the short sale

rule, the NASD is proposing an

amendment to the Minimum Increment

Rule to provide that a market maker or

customer could not bring about or cause

the inside spread for a stock to narrow

in a declining market (e.g., lowering its

offer to create an inside spread less than

1⁄16th) for the purpose of facilitating the

execution of a short sale at a price less

than 1⁄16th above the inside bid.

Commission’s Findings and Order

Granting Accelerated Approval of

Proposed Rule Change

The Commission finds that temporary

approval on an accelerated basis of the

NASD’s proposed rule change through

January 15, 1998, is consistent with the

Act and the rules and regulations

promulgated thereunder. Specifically,

the Commission finds that the proposed

rule change is consistent with the

provisions of Section 15A(b)(6) of the

Act.7 Section 15A(b)(6) requires that the

rules of a national securities association

be designed to prevent fraudulent and

manipulative acts and practices, to

promote just and equitable principles of

trade, to foster cooperation and

coordination with persons engaged in

regulating, clearing, settling, processing

information with respect to, and

facilitating transactions in securities,

and to remove impediments to and

perfect the mechanism of a free and

open market. Given the Commission’s

temporary approval of the short sale

rule, the Commission believes that the

proposed rule change is a reasonable

approach to preserve the short sale

rule’s underlying purpose and effect

when the inside spread is less than

1⁄16th.

The Commission also finds good

cause for approving on a temporary

basis the proposed rule change prior to

the 30th day after the date of

publication of notice of filing thereof.

The Commission believes that it is

appropriate to accelerate temporary

approval of the proposed rule change

through January 15, 1998, because

accelerated approval will allow NASD

members, without delay, to effect

‘‘legal’’ short sales consistent with the

underlying purpose and effect of the

NASD’s short sale rule in situations

where the inside spread is less than

1⁄16th, while the NASD and the

Commission consider the effect of the

short sale rule.

It is Therefore Ordered, pursuant to

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

proposed rule change, SR–NASD–97–59

be, and hereby is, approved on a

temporary basis through January 15,

1998.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.8

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–26357 Filed 10–3–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39140; File No. SR–NASD–

97–65]

Self-Regulatory Organizations; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change by the National

Association of Securities Dealers, Inc.

Extending the Pilot Program of the

NASD’s Short Sale Rule

September 26, 1997.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’) 1 and Rule 19b–4 2 thereunder,

notice is hereby given that on

September 4, 1997, the National

Association of Securities Dealers, Inc.

(‘‘NASD’’ or ‘‘Association’’) 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 NASD. The

Commission is publishing this notice to

solicit comments on the proposed rule

change from interested persons and to

grant accelerated approval of the

proposed rule change.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The NASD is proposing to amend

Rule 3350 to extend the pilot program

of the NASD’s short sale rule from

October 1, 1997 until January 15, 1998.

Below is the text of the proposed rule

change. Proposed new language is in

italics; proposed deletions are in

brackets.

* * * * *
Federal Register / Vol. 62, No. 193 / Monday, October 6, 1997 / Notices 52171

3A short sale is a sale of a security which the

seller does not own or any sale which is

consummated by the delivery of a security

borrowed by, or for the account of, the seller. To

determine whether a sale is a short sale members

must adhere to the definition of a ‘‘short sale’’

contained in Rule 3b–3 of the Act, which rule is

incorporated into Nasdaq’s Rule by NASD Rule

3350(k)(1).

4Securities Exchange Act Release No. 34277

(June 29, 1994), 59 FR 34885 (July 7, 1994) [File No.

SR–NASD–92–12] (‘‘Short Sale Rule Approval

Order’’).

5The Rule was extended on several occasions.

Securities Exchange Act Release No. 36532

(November 30, 1995), 60 FR 62519 (December 6,

1995) [File No. SR–NASD–95–58]; See also

Securities Exchange Act Release No. 36171 (August

30, 1995), 60 FR 46651 (September 7, 1995) [File

No. SR–NASD–95–35]. The most recent extension

of the pilot program through October 1, 1997, was

approved by the SEC to afford the NASD a better

opportunity to examine the effectiveness of the Rule

and the impact of the market maker exemption from

the Rule. Securities Exchange Act Release No.

37917 (November 1, 1996), 61 FR 57934 (November

8, 1996) [File No. SR–NASD–96–41]. In this

connection, in order to enhance its ability to

examine the impact of the market maker exemption,

the NASD received SEC approval of its proposal to

require market makers to mark their ACT reports to

denote when they have relied on the market maker

exemption. Securities Exchange Act Release No.

38240 (February 5, 1997), 62 FR 6290 (February 11,

1997) [File No. SR–NASD–96–52].

6Nasdaq calculates the inside bid or best bid from

all market makers in the security (including bids on

behalf of exchanges trading Nasdaq securities on an

unlisted trading privileges basis) and disseminates

symbols to denote whether the current inside bid

is an ‘‘up bid’’ or a ‘‘down bid.’’ Specifically, an

‘‘up bid’’ is denoted by a green ‘‘up’’ arrow and a

‘‘down bid’’ is denoted by a red ‘‘down’’ arrow. To

effect a ‘‘legal’’ short sale on a down bid, the short

sale must be executed at a price at least a 1⁄16th of

a point above the current inside bid. Conversely, if

the security’s symbol has a green up arrow next to

it, members can effect short sales in the security

without any restrictions.

7Under the PMM Standards, a market maker was

required to satisfy at least two of the following four

criteria each month to be eligible for an exemption

from the Rule: (1) The market maker must be at the

best bid or best offer as shown on Nasdaq no less

than 35 percent of the time; (2) the market maker

must maintain a spread no greater than 102 percent

of the average dealer spread; (3) no more than 50

percent of the market maker’s quotation updates

may occur without being accompanied by a trade

execution of at least one unit of trading; or (4) the

market maker executes 11⁄2 times its

‘‘proportionate’’ volume in the stock. If a PMM did

not satisfy the threshold standards after a particular

review period, the market maker lost its designation

as a PMM (i.e., the ‘‘P’’ next to its market maker

identification was removed). Market makers could

requalify for designation as a PMM by satisfying the

threshold standards in the next review period.

8Securities Exchange Act Release No. 38294

(February 14, 1997), 62 FR 8289 (February 24, 1997)

[File No. SR–NASD–97–07].

9See NASD Rule 3350(c) (2)–(8). The Rule also

provides that a member not currently registered as

a Nasdaq market maker in a security that has

acquired the security while acting in the capacity

of a block positioner shall be deemed to own such

security for the purposes of the Rule

notwithstanding that such member may not have a

net long position in such security, if and to the

extent that such member’s short position in such

security is subject to one or more offsetting

positions created in the course of bona fide

arbitrage, risk arbitrage, or bona fide hedge

activities. In addition, the NASD has recognized

that SEC staff interpretations to Rule 10a–1 dealing

with the liquidation of index arbitrage positions

and an ‘‘international equalizing exemption’’ are

equally applicable to the NASD’s Rule.

10Short Sale Rule Approval Order, supra note 4,

at 34891.

NASD Rule 3350

(1) This section shall be in effect until

January 15, 1998 (October 1, 1997).

* * * * *

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

NASD 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 V below. Nasdaq 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. Background and Description of the

NASD’s Short Sale Rule

On June 29, 1994, the SEC approved

the rule applicable to short sales 3 in

Nasdaq National Market (‘‘NNM’’)

securities on an eighteen-month pilot

basis through March 5, 1996.4 The

termination date for the pilot program

for the Rule was subsequently extended

until October 1, 1997.5

The Rule prohibits member firms

from effecting short sales at or below the

current inside bid as disseminated by

Nasdaq whenever that bid is lower than

the previous inside bid.6 The Rule is in

effect during normal domestic market

hours (9:30 a.m. to 4:00 p.m., Eastern

Time). To ensure that market maker

activities that provide liquidity and

continuity to the market are not

adversely constrained when the Rule is

invoked, the Rule provides an

exemption to ‘‘qualified’’ Nasdaq market

makers (i.e., those market makers that

meet the Primary Market Maker

(‘‘PMM’’) standards). Even if a market

maker is able to avail itself of the

qualified market maker exemption, it

can only utilize the exemption from the

Rule for transactions that are made in

connection with bona fide market

making activity. If a market maker does

not satisfy the requirements to be a

qualified market maker, it can remain a

market maker in the Nasdaq system,

although it can not take advantage of the

exemption from the Rule.

Since the Rule has been in effect,

there have been three methods used to

determine whether a market maker is

eligible for the market maker exemption.

Specifically, from September 4, 1994

through February 1, 1996, Nasdaq

market makers who maintained a

quotation in a particular NNM security

for 20 consecutive business days

without interruption were exempt from

the Rule for short sales in that security,

provided the short sales were made in

connection with bona fide market

making activity (the ‘‘20-day’’ test).

From February 1, 1996 until February

14, 1997, the ‘‘20-day’’ test was replaced

with a four-part quantitative test known

as the Nasdaq PMM Standards.7 On

February 14, 1997, the PMM standards

were waived for all NNM securities due

to the effects of the SEC’s Order

Handling Rules and corresponding

NASD rule change and system

modifications on the operation of the

four quantitative standards.8 For

example, among other effects, the

requirement that market makers display

customer limit orders adversely affected

the ability of market makers to satisfy

the ‘‘102% Average Spread Standard.’’

Nasdaq is presently in the process of

formatting revised PMM standards that

focus principally on whether a market

maker is a ‘‘net’’ provider of liquidity.

Furthermore, in an effort to not

constrain the legitimate hedging needs

of options market makers, the Rule

contains a limited exception for

standardized options market makers.

The Rule also contains an exemption for

warrant market makers similar to the

one available for options market makers.

The Rule also incorporates seven

exemptions contained in Rule 10a–1

under the Act (‘‘Rule 10a–1’’) that are

relevant to trading on Nasdaq.9

2. Proposal To Extend the Short Sale

Rule

When the Commission approved the

Rule on a temporary basis, it made

specific findings that the Rule was

consistent with Sections 11A, 15A(b)(6),

15A(b)(9), and 15A(b)(11) of the Act.

Specifically, the Commission stated

that, ‘‘recognizing the potential for

problems associated with short selling,

the changing expectations of Nasdaq

market participants and the competitive

disparity between the exchange markets

and the OTC market, the Commission

believes that regulation of short selling

of NNM securities in consistent with the

Act.’’ 10 In addition, the Commission

stated that it ‘‘believes that the NASD’s

short sale bid-test, including the market
52172 Federal Register / Vol. 62, No. 193 / Monday, October 6, 1997 / Notices

11 Id. at 34892.

12When the NASD’s Rule was first considered by

the Commission, the SEC received 397 comment

letters on the proposal, with 275 comments

opposed to the Rule and 122 comments in favor of

the Rule. Those commenters opposed to the Rule

argued that: (1) The NASD had failed to provide

sufficient evidence of the need for the Rule or

demonstrate the appropriateness of the Rule based

on a ‘‘bid’’ test instead of ‘‘tick’’ test; (2) the PMM

standards will have negative effects on both market

makers and the Nasdaq market; and (3) the Rule is

inconsistent with the requirements of the Act.

13 In particular, before considering any NASD

proposal to extend, modify, permanently

implement or terminate the Rule, the Commission

requested that the NASD examine: (1) The effects

of the Rule on the amount of short selling; (2) the

length of time that the Rule is in effect (i.e., the

duration of down bid situations); (3) the amount of

non-market maker short selling permitted under the

Rule; (4) the extent of short selling by market

makers exempt from the Rule; (5) whether there

have been any incidents of perceived ‘‘abusive short

selling’’; (6) the effects of the Rule on spreads and

volatility; (7) whether the behavior of bid prices has

been significantly altered by the Rule; and (8) the

effect of permitting short selling based on a

minimum increment of 1/16th.

14 In July 1996, the NASD’s Economic Analysis

Department completed a study on the economic

impact of the Rule, which concluded that the Rule

has had no adverse impact on the market. The

Economic Impact of the Nasdaq Short Sale Rule,

NASD Economic Research Department (July 23,

1996) (‘‘July 1996 Short Sale Study’’). In the same

month, NASD submitted a proposal to adopt the

Rule on a permanent basis. Securities Exchange Act

Release No. 37942 (July 29, 1996), 61 FR 40693

(SR–NASD–96–30). Because the NASD believed

additional quantitative analysis was necessary to

evaluate the effects of the Rule, the NASD withdrew

this rule filing. In August 1997, the NASD’s

Economic Analysis Department completed a second

study on the economic impact of the Rule, which

further concluded that the Rule has had no adverse

impact on the market. The Nasdaq Stock Market

Short Sale Rule: Analysis of Market Quality Effects

and The Market Maker Exemption, NASD Economic

Research Department (August 7. 1997) (‘‘August

1997 Short Sale Study’’).

maker exemption, is a reasonable

approach to short sale regulation of

Nasdaq National Market securities and

reflects the realities of its market

structure.’’ 11 However, in light of the

Commission’s concerns with adverse

comments made about the Rule and the

Commission’s own concerns with the

structure and impact of the Rule,12 the

Commission determined to approve the

Rule on a temporary basis to afford the

NASD and the SEC an opportunity to

study the effects of the Rule and its

exemptions.13 To address these

concerns, in July 1996 and in August

1997, the NASD’s Economic Research

Department prepared two separate

studies on the economic impact of the

Rule, which concluded, among other

things, that the Rule had no adverse

impact on the market.14 Accordingly, on

August 8, 1997, the NASD submitted a

proposed rule change that requested

permanent approval of the Rule.

The NASD notes that while the short

sale pilot is set to expire on October 1,

1997, Nasdaq currently is working

diligently to develop effective PMM

standards, which the NASD plans to file

shortly with the Commission. The

NASD notes that any PMM standards it

might propose are integrally related to

the Rule, that is, changes to PMM

standards may have an impact on the

Rule because it will define the

parameters under which market makers

qualify for PMM status and thus may

execute ‘‘legal’’ short sales. Therefore,

the NASD believes that any PPM

standards that the NASD may propose

may have an impact on whether the

Commission ultimately grants the

NASD’s request for permanent approval

of the Rule. Accordingly, in light of

these factors and expiration of the Rule

on October 1, 1997, the NASD is

proposing to extend the Rule’s pilot

until January 15, 1998. The NASD

believes this extension will afford the

NASD time to formulate and submit to

the Commission revised PMM standards

and will allow the Commission to

review on a contemporaneous basis

these two integrally related proposed

rule changes (i.e., the short sale and

PMM rules).

The NASD believes the proposed rule

change is consistent with Sections

15A(b)(6) of the Act. Section 15A(b)(6)

requires that the rules of a national

securities association be designed to

prevent fraudulent and manipulative

acts and practices, to promote just and

equitable principles of trade, to foster

cooperation and coordination with

persons engaged in regulating, clearing,

settling, processing information with

respect to, and facilitating transactions

in securities, and to remove

impediments to and perfect the

mechanism of a free and open market.

Specifically, the NASD believes that

extending the pilot period for the Rule

will ensure continuity in regulation

while the Commission considers the

proposed PMM standards and

permanent approval of the Rule.

The NASD also believes the proposed

rule change is consistent with Section

15A(b)(6) of the Act because the Rule is

premised on the same anti-manipulation

and investor protection concerns that

underlie the SEC’s own short sale rule,

Rule 10a–1 under the Act (‘‘Rule 10a–

1’’). In particular, as with Rule 10a–1,

the NASD believes its Rule promotes

just and equitable principles of trade by

permitting long sellers access to market

prices at any time, while constraining

the execution of potentially abusive and

manipulative short sales at or below the

bid in a declining market. In addition,

as with Rule 10a–1, Nasdaq believes its

Rule removes impediments to a free and

open market for long sellers and helps

to assure liquidity at bid prices that

might otherwise be usurped by short

sellers. Lastly, because the immediate

beneficiaries of the Rule are

shareholders of NNM companies,

Nasdaq believes its Rule is designed to

protect investors and the public interest.

At the same time, given that the Rule

does not constrain short sales in a

raising market or prohibit the execution

of short sales in a declining market

above bid prices, Nasdaq believes the

Rule does not diminish the important

pricing efficiency and liquidity benefits

that legitimate short selling activity

provides.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The NASD believes that the proposed

rule change will not 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

Comments were neither solicited nor

received.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The NASD requests that its proposal

to extend the effectiveness of the Rule

until January 15, 1998, be approved on

an accelerated basis prior to October 1,

1997.

IV. Commission’s Findings and Order

Granting Accelerated Approval of the

Proposed Rule Change

The Commission finds that the

NASD’s proposed rule change seeking to

extend the pilot of the Rule through

January 15, 1998, is consistent with the

Act and the rules and regulations

promulgated thereunder. Specifically,

the Commission finds that the proposed

rule change is consistent with Section

15A(b)(6) of the Act which requires that

the NASD rules be designed, among

other things, to facilitate securities

transaction and to protect investors and

the public interest. The Commission

believes that the proposed rule change

is consistent with the Act because

extension of the pilot will allow the

Commission and the NASD to consider

the potential problems associated with

short selling, the changing expectations

of Nasdaq market participants and the

potential for competitive disparity

between the exchange markets and the

OTC market. This extension also will

afford NASD time to formulate and

submit to the Commission revised PMM
Federal Register / Vol. 62, No. 193 / Monday, October 6, 1997 / Notices 52173

15See also companion release Securities

Exchange Act Release No. 39139.

16 17 CFR 200.30–3(a)(12) (1997).

standards and will allow the

Commission to review on a

contemporaneous basis these two

integrally related rules (i.e., the short

sale and PMM rules).

The Commission also finds good

cause for approving the proposed rule

change prior to the 30th day after the

date of publication of notice of filing

thereof. The Commission believes that it

is appropriate to approve on an

accelerated basis the extension through

January 15, 1998, of the pilot program

of the Rule to ensure the continuous

operation of the Rule and to allow the

NASD and the Commission time to

review the operation of the Rule, which

is set to expire on October 1, 1997.

V. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing.

People making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 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

Room. Copies of the filing will also be

available for inspection and copying at

the NASD’s principal offices. All

submissions should refer to File No.

SR–NASD–97–65 and should be

submitted by October 27, 1997.

It is therefore ordered, pursuant to

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

proposed rule change, SR–NASD–97–65

be, and hereby is, approved through

January 15, 1998.15

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.16

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–26359 Filed 10–3–97; 8:45 am]

BILLING CODE 8010–01–M

SOCIAL SECURITY ADMINISTRATION

Agency Information Collection

Activities: Proposed Collection

Requests

This notice lists information

collection packages that will require

submission to the Office of Management

and Budget (OMB), in compliance with

Pub. L. 104–13 effective October 1,

1995, The Paperwork Reduction Act of

1995.

1. Disability Report—0960–0141. The

information collected on Form SSA–

3368–BK is needed for the

determination of disability by the State

Disability Determination Services. This

version of the form will be used in those

SSA offices and State DDS offices that

are piloting SSA’s Reengineered

Disability System. The information will

be used to develop medical evidence

and to assess the alleged disability. The

respondents are applicants for disability

benefits.

Number of Respondents: 36,500.

Frequency of Response: 1.

Average Burden Per Response: 30

minutes.

Estimated annual Burden: 18,250

hours.

2. Pain Report—Child—0960–0540.

The information collected on form SSA–

3371–BK by the Social Security

Administration is used to make a

determination of disability for a child

under the title XVI program. This

information is essential to the

adjudication of a claim. The

respondents are applicants for title XVI

child disability benefits.

Number of Respondents: 250,000.

Frequency of Response: 1.

Average Burden Per Response: 15

minutes.

Estimated Annual Burden: 62,500

hours.

Written comments and

recommendations regarding the

information collection(s) should be sent

within 60 days from the date of this

publication, directly to the SSA Reports

Clearance Officer at the following

address: Social Security Administration,

DCFAM, Attn: Nicholas E. Tagliareni,

6401 Security Blvd., 1–A–21 Operations

Bldg., Baltimore, MD 21235.

In addition to your comments on the

accuracy of the Agency’s burden

estimate, we are soliciting comments on

the need for the information; its

practical utility; ways to enhance its

quality, utility and clarity; and on ways

to minimize burden on respondents,

including the use of automated

collection techniques or other forms of

information technology.

To receive a copy of any of the forms

or clearance packages, call the SSA

Reports Clearance Officer on (410) 965–

4125 or write to him at the address

listed above.

Dated: September 30, 1997.

Nicholas E. Tagliareni,

Reports Clearance Officer, Social Security

Administration.

[FR Doc. 97–26410 Filed 10–3–97; 8:45 am]

BILLING CODE 4190–29–P

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

Reports, Forms and Recordkeeping

Requirements Agency Information

Collection Activity Under OMB Review

AGENCY: Office of the Secretary, DOT.

ACTION: Notice.

SUMMARY: In accordance with the

Paperwork Reduction Act of 1995 (44

U.S.C. Chapter 3501, et seq.) this notice

announces that the Information

Collection Requests (ICRs) abstracted

below has been forwarded to the Office

of Management and Budget (OMB) for

review and comment. The ICR describes

the nature of the information collection

and it’s expected cost and burden. The

Federal Register Notice with a 60-day

comment period soliciting comments on

the following collection of information

was published on June 24, 1997 [61 FR,

34101–34102].

DATES: Comments on this notice must be

received on or before December 5, 1997.

FOR FURTHER INFORMATION CONTACT: Ms.

Carol A. Woods, Air Carrier Fitness

Division (X–56), Office of Aviation

Analysis, Office of the Secretary, U.S.

Department of Transportation, 400

Seventh Street, SW., Washington, DC

20590, 202/366–9721. Telephone: (202)

366–3784.

SUPPLEMENTARY INFORMATION:

Office of the Secretary, Office of

Aviation Analysis

Title: Procedures and Evidence Rules

for Air Carrier Authority Applications.

OMB Control Number: 2105–0023.

Type of Request: Reinstatement,

without change, of a previously

approved collection for which approval

has expired.

Affected Public: Persons seeking

initial or continuing authority to engage

in air transportation of persons,

property, and/or mail.

Abstract: In order to determine the

fitness of persons seeking authority to

engage in air transportation, the

Department collects information from

them about their ownership,