62650 Federal Register / Vol. 62, No. 226 / Monday, November 24, 1997 / Notices

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

2 17 CFR 240.19b–4.

3 In Amendment No. 1, the CBOE added a

sentence to clarify that the immediate impact of the

rule change will be to allow members in the

Standard & Poor’s 100 Index pit and in equity pits

to use headsets that are being provided with the

Exchange’s new Ericsson wireless telephone

system. See Letter from Timothy Thompson, Senior

Attorney, CBOE, to Michael Walinskas, Senior

Special Counsel, Division of Market Regulation,

SEC, dated October 31, 1997.

4See Letter from Timothy Thompson, Senior

Attorney, CBOE, to Jerome Roche, Law Clerk,

Division of Market Regulation, SEC, dated

November 13, 1997.

and Disarmament Agency. Effective

September 10, 1997.

United States Information Agency

Director, Office of Congressional and

External Affairs to the Director,

International Broadcasting Bureau.

Effective September 25, 1997.

United States Tax Court

Trial Clerk to a Judge. Effective

September 11, 1997.

Trial Clerk to a Judge. Effective

September 11, 1997.

Trial Clerk to a Judge. Effective

September 11, 1997.

Authority: 5 U.S.C. 3301 and 3302; E.O.

10577, 3 CFR 1954–1958 Comp., P.218.

Office of Personnel Management.

Janice R. Lachance,

Acting Director.

[FR Doc. 97–30718 Filed 11–21–97; 8:45 am]

BILLING CODE 6325–01–P

SECURITIES AND EXCHANGE

COMMISSION

Summission for OMB Review;

Comment Request

Upon Written Request, Copies Available

From: Securities and Exchange

Commission, Office of Filings and

Information Services, Washington, DC

20549

Extension:

Rule 29, File No. 270–169, OMB Control

No. 3235–0149

Rule 83, File No. 270–82, OMB Control No.

3235–0181

Notice is hereby given that pursuant

to the Paperwork Reduction Act of 1995

(44 U.S.C. 3501 et seq.) the Securities

and Exchange Commission

(‘‘Commission’’) has submitted to the

Office of Management and Budget

requests for extension of the previously

approved collections of information

discussed below.

Rule 29 [17 CFR 250.29] states that

‘‘[a] copy of each annual report

submitted by an registered holding

company or any subsidiary thereof to a

State Commission covering operations

not reported to the Federal Energy

Regulatory Commission shall be filed

with the Securities and Exchange

Commission no later than ten days after

such submission.’’ The Commission

receives about 62 annual reports per

year under this regulation, which

imposes an annual burden of about 15.5

hours.

Rule 83 [17 CFR 250.83] authorizes an

exemption from the ‘‘at cost’’

requirements of Section 13(b) for ‘‘the

performance of any service, sales, or

construction contract for any associate

company which does not derive,

directly or indirectly, any material part

of its income from sources within the

United States and which is not a public

utility company operating within the

United States * * *.’’ The Commission

receives about one application per year

under Rule 83, which imposes an

annual burden of about three hours.

The estimates of average burden hours

are made for the purposes of the

Paperwork Reduction Act and are not

derived from a comprehensive or even

a representative survey or study of the

costs of Commission rules and forms.

It should be noted that ‘‘an agency

may not conduct or sponsor, and a

person is not required to respond to, a

collection of information unless it

displays a currently valid control

number.’’

Written comments regarding the

above information shall be directed to

the following persons: (i) Desk Officer

for the Securities and Exchange

Commission, Office of Information and

Regulatory Affairs, Office of

Management and Budget, Room 3208,

New Executive Office Building,

Washington, D.C. 20503; and (ii)

Michael E. Bartell, Associate Executive

Director, Office of Information

Technology, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Comments

must be submitted to OMB within 30

days of this notice.

Dated: November 13, 1997.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–30722 Filed 11–21–97; 8:45 am]

BILLING CODE 8010–01–M

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[Release No. 34–39331; File No. SR–CBOE–

97–56]

Self-Regulatory Organizations; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change and Amendment No. 1

Thereto by the Chicago Board Options

Exchange, Inc. Relating to the

Elimination of the Prohibition on the

Use of Headsets and Other Telephone

Technology

November 17, 1997.

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 October

20, 1997, the Chicago Board Options

Exchange, Inc. (‘‘CBOE’’ or ‘‘Exchange’’)

filed with the Securities and Exchange

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

the proposed rule change as described

in Items I and II below, which Items

have been prepared by the CBOE. On

November 3, 1997, the CBOE filed

Amendment No. 1 to its proposal.3 On

November 13, 1997, the CBOE

submitted a letter clarifying its ability to

surveil the use of telephone headsets on

its trading floors.4 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 CBOE proposes to eliminate

certain restrictions on the types of

telephones that may be used at the

trading posts for equity options and

options on the Standard & Poor’s 100

Index (‘‘OEX’’). The text of the proposed

rule change and Amendment No. 1 is

available at the Office of the Secretary,

CBOE, and at the Commission.

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

CBOE 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 III below. The CBOE 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 eliminate the prohibitions

on certain types of telephones that may
Federal Register / Vol. 62, No. 226 / Monday, November 24, 1997 / Notices 62651

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

6 In approving this rule, the Commission notes

that it has considered the proposed rule’s impact on

effciency, competition, and capital formation. 15

U.S.C. 78c(b)(5).

7U.S.C. 78f(b)(5).

8Headsets are currently being used at the trading

posts for options on the Standard & Poor’s 500

Index (‘‘SPX’’) and the Dow Jones Industrial 30

Index (‘‘DJX’’) without any reported problems.

Telephone conversation between Timothy

Thompson, Senior Attorney, CBOE, and Mike

Walinskas, Senior Special Counsel, Division of

Market Regulation, SEC, on October 30, 1997.

9 15 U.S.C. 78f.

10 15 U.S.C. 78s(b)(2).

be used by members at the equity option

posts and at the OEX trading post. The

Exchange’s phone policy for the OEX

option trading post is reflected in

Regulatory Circular RG 96–73, and the

Exchange’s phone policy for the equity

option trading post is contained in

Regulatory Circulars RG 94–26 and RG

97–03.

The Exchange is proposing to

eliminate the current prohibition on the

use of headsets and cellular telephones

at both the equity and the OEX option

trading posts. The Exchange no longer

sees a regulatory reason for continuing

to impose these specific prohibitions.

The Exchange believes that its

customary floor surveillance procedures

and the monitoring of trading activities

of a member, after a call, by other selfinterested members of the trading post

are sufficient. In place of prohibiting the

use of these types of telephones, the

Exchange will issue a circular to its

members stating that ‘‘the Exchange

may disapprove the use of any type of

telephone technology that interferes

with the normal operation of the

Exchange’s own systems or facilities or

that the Exchange determines interferes

with its regulatory duties.’’ The

Exchange believes this constitutes a

clarification of the authority the

Exchange already exercises under

Exchange Rule 6.23 which permits the

Exchange to ‘‘direct the discontinuance

of any communication facility

terminating on the floor of the

Exchange.’’ Pursuant to Rule 6.23, the

Exchange will continue to prohibit the

use of cellular telephones. In addition to

distributing the circular, the Exchange

will redistribute a revised version of the

OEX and equity option post telephone

circulars with the change in the policy

indicated. As under the current policies,

the CBOE’s members wishing to

establish a telephone line on the floor

must first receive approval of the

Exchange or the appropriate Floor

Procedure Committee.

2. Statutory Basis

The Exchange believes that the

proposed rule change is consistent with

the requirements of Section 6(b)(5) of

the Act 5 that an Exchange have rules

that are designed to promote just and

equitable principles of trade, to remove

impediments to and perfect the

mechanism of a free and open market

and a national market system, and in

general, to protect investors and the

public interest. The Exchange believes

that the elimination of the prohibition

on headsets and other telephone

technology is consistent with these

objectives in that it is designed to

improve communication to and from the

Exchange’s trading floor in a manner

that prevents fraudulent and

manipulative acts and practices and

maintains fair and orderly markets.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange believes that the

proposed rule change will impose no

burden on competition.

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. Solicitation of Comments

Interested persons are invited to

submit written data, views and

arguments concerning the foregoing.

Persons making written submissions

should filed 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, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of the CBOE. All submissions

should refer to File No. SR–CBOE–97–

56 and should be submitted by

December 15, 1997.

IV. Commission’s Findings and Order

Granting Accelerated Approval of the

Proposed Rule Change

The Commission finds that the

proposed rule change, as amended, is

consistent with the requirements of the

Act and the rules and regulations

thereunder applicable to a national

securities exchange.6 Specifically, the

Commission believes the Exchange’s

proposal to eliminate the per se

prohibition on headsets and other

telephone technology is consistent with

Section 6(b)(5) of the Act.7 Approval of

this rule change permits the CBOE to

extend the use of established headset

communications equipment to the OEX

and equity trading areas.8 The

Commission believes that the Exchange

continues to have sufficient authority to

regulate and restrict the use of

communication devices on its floor

under Exchange Rule 6.23 and the

phone line approval process in the

Exchange’s Regulatory Circulars. The

Commission also believes that the CBOE

has adequately represented its ability to

surveil the use of headset

communications equipment.

The Commission nonetheless

encourages the Exchange to consider the

adoption of more comprehensive

guidelines in the area of

communications equipment approval.

The current CBOE telephone policies

rely upon the ability to: (1) Approve

new telephone lines; and (2) restrict the

use of communication devices on its

floor, pursuant to Exchange Rule 6.23.

This creates a potential loophole

whereby a novel communications

device could be brought on to the floor,

without Exchange approval, if the

device did not rely on a ‘‘telephone

line’’ and had not been clearly restricted

pursuant to Exchange Rule 6.23.

The Commission finds good cause for

approving the proposed rule change,

including Amendment No. 1, prior to

the thirtieth day after the date of

publication of notice thereof in the

Federal Register. This immediate

impact of the proposal is to allow the

CBOE’s members to utilize headsets that

are provided within the Exchange’s new

Ericsson wireless telephone system. As

noted above, this system is currently in

use in other trading crowds on the

Exchange. Accelerated approval will

allow the incorporation of this new

technology on the OEX and equity

trading posts without further delay. For

the foregoing reasons, the Commission

believes that granting accelerated

approval to the proposed rule change is

appropriate and consistent with Section

6 of the Act.9

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,10 that the

proposed rule change (SR–CBOE–97–
62652 Federal Register / Vol. 62, No. 226 / Monday, November 24, 1997 / Notices

11 17 CFR 200.30–3(a)(12).

1Advice G–2 does not contain a fine schedule.

Accordingly, the proposal does not affect the

Exchange’s minor rule violation enforcement and

reporting plan.

2PHLX Rule 1047A(b) allows specialists to

conduct a rotation in accordance with PHLX Rule

1047, Commentary .01 (b) and (c).

3See also CBOE Rule 6.2, Interpretation .03

(closing rotation for expiring index options is not

ordinarily employed).

4A trading rotation is a series of brief time

periods during which bids, offers and transactions

in only specified series can be made.

5See Securities Exchange Act Release No. 35742

(May 19, 1995), 60 FR 28188 (May 30, 1995) (order

approving File No. SR–CBOE–95–04) )‘‘CBOE

Approval Order’’).

56), including Amendment No. 1, is

approved on an accelerated basis.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–30721 Filed 11–21–97; 8:45 am]

BILLING CODE 8010–01–M

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[Release No. 34–39332; File No. SR–PHLX–

97–52]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Philadelphia Stock Exchange, Inc.,

Relating to Options Trading Rotations

November 17, 1997.

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

Securities Exchange Act of 1934

(‘‘Act’’), 15 U.S.C. 78s(b)(1), notice is

hereby given that on October 23, 1997,

the Philadelphia Stock Exchange, Inc.

(‘‘PHLX’’ 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 self-regulatory

organization. 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

Pursuant to Rule 19b–4 of the Act, the

PHLX proposes to amend PHLX Rule

1047, ‘‘Trading Rotations, Halts and

Suspensions,’’ to (1) Emphasize that

opening rotations are conducted daily;

(2) replace references to ‘‘the Exchange’’

with references to ‘‘two Floor Officials

and a Market Regulation officer’’

throughout PHLX Rule 1047; (3) delete

references in PHLX Rule 1047,

Commentary .01 (a) and (d) to puts and

calls trading on the same security; (4)

define modified, reverse and shotgun

rotations in PHLX Rule 1047,

Commentary .01(b); (5) require reverse

rotations where there is a heavy influx

of orders, unless exempted by two Floor

Officials with the concurrence of a

PHLX Market Regulation officer; (6)

require that two Floor Officials, with the

concurrence of a PHLX Market

Regulation officer, approve second and

subsequent rotations; (7) provide that,

with the approval of two Floor Officials

and the concurrence of a PHLX Market

Regulation officer, modified rotations

(other than a reverse or shotgun

rotation) can be employed where there

is a delayed opening, halt or suspension

in trading or other unusual market

conditions; and (8) regarding closing

rotations at expiration, add ‘‘or at an

earlier time, with the concurrence of a

Market Regulation officer,’’ to allow the

closing rotation at expiration to begin

other than after the option normally

ceases trading (4:02 p.m.).

The PHLX proposes to make

comparable changes to PHLX Rule

1047A, ‘‘Trading Rotations, Halts or

Reopenings,’’ regarding index options,

and to Floor Procedure Advice

(‘‘Advice’’) G–2, ‘‘Trading Rotations,

Halts or Reopenings.’’ 1 Because PHLX

Rule 1047A(b) refers directly to PHLX

Rule 1047, Commentary .01,2 most of

the above-described amendments will

apply to index options trading. For

PHLX Rule 1047A(a)(ii), (c), (d), and (f),

and for the corresponding paragraphs of

Advice G–2, the PHLX proposes to

replace references to ‘‘the Exchange’’

with references to ‘‘two Floor Officials

and a Market Regulation officer.’’ Under

PHLX Rule 1047A(e), closing rotations

for expiring index options are not

required, nor are they prohibited.3

The text of the proposed rule change

is available at the Office of the

Secretary, PHLX, and at the

Commission.

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

self-regulatory organization 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 self-regulatory organization 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

PHLX Rule 1047 governs options

trading rotations 4 (including opening

rotations), delayed openings, halts or

suspensions in trading, reopenings and

closing rotations. Trading rotations are

intended to produce fair and orderly

markets by fairly setting opening prices,

taking into account orders and bids/

offers on the book and in the trading

crowd. The Exchange has considered

the types of opening rotations that

should be permitted or required in order

to reduce the length of option openings,

especially in unusual circumstances,

and to prevent subsequent rotations.

The purpose of the proposed rule

change is to improve the efficiency of

option openings. PHLX Rule 1047A is

the corresponding rule governing index

options trading.

First, the Exchange proposes to

amend PHLX Rule 1047(a) to emphasize

that opening rotations are conducted

daily, as opposed to closing rotations,

which are conducted only at expiration.

This change is designed to clarify PHLX

Rule 1047(a).

Second, the Exchange proposes to

replace ‘‘the Exchange’’ with ‘‘two Floor

Officials and a Market Regulation

officer’’ throughout PHLX Rule 1047.

This term originated in a comparable

rule of the American Stock Exchange,

but lacks specificity and does not reflect

that, in reality, the approval of two

Floor Officials is received. The

Exchange believes that trading rotations

present the types of issues and need for

prompt determinations that are

particularly suited for Floor Official

approval.5 The purpose of adding an

Exchange officer is to trigger proper

notification of the approval and further

encourage prompt openings. It should

also enable Exchange staff to better

monitor the conditions giving rise to

rotation-related Floor Official approval.

Third, the Exchange proposes to

delete references in PHLX Rule 1047,

Commentary .01(a) and (d) to puts and

calls trading on the same security. The

purpose of this change is to recognize

that almost without exception, both puts

and calls trade respecting all Exchange

options, such that the preface ‘‘if’’ is

confusing. The remainder of

Commentary .01(a) states that the