Federal Register / Vol. 62, No. 227 / Tuesday, November 25, 1997 / Notices 62795

2Section 12(d)(1)(G)(i)(II) limits a fund of funds’

investments to certain government securities and

short-term instruments.

other investment companies, represent

more than 10% of the acquiring

company’s total assets. Section

12(d)(1)(B) provides that no registered

open-end investment company may sell

its securities to another investment

company if the sale will cause the

acquiring company to own more than

3% of the acquired company’s voting

stock, or if the sale will cause more than

10% of the acquired company’s voting

stock to be owned by investment

companies.

2. Section 12(d)(1)(G) of the Act

provides that section 12(d)(1) will not

apply to securities of an acquired

company purchased by an acquiring

company if: (a) The acquiring company

and the acquired company are part of

the same group of investment

companies; (b) the acquiring company

holds only securities of acquired

companies that are part of the same

group of investment companies,

government securities, and short-term

paper; (c) the aggregate sales loads and

distribution-related fees of the acquiring

company and the acquired company are

limited; and (d) the acquired company

has a policy that prohibits it from the

acquiring securities of registered openend investment companies or registered

unit investment trusts in reliance on

section 12(d)(1)(F) or (G).

3. Applicants state that the proposed

arrangement would comply with the

provisions of section 12(d)(1)(G), but for

the fact that the Balanced Portfolio

would like to retain the flexibility to

invest directly in stocks, bonds, and

other instruments, in addition to

investing in the International Equity

Portfolio.2

4. Section 12(d)(1)(J) provides that the

SEC may exempt persons or transactions

from any provision of section 12(d)(1) if

and to the extent the exemption is

consistent with the public interest and

the protection of investors. Applicants

believe that the proposed arrangement

will not implicate any of the abuses that

section 12(d)(1) was intended to

prevent, such as duplicative costs,

undue influence or control, or the

potential adverse impact of large-scale

redemptions.

B. Section 17(a)

5. Section 17(a) of the Act prohibits

certain purchases and sales of securities

between investment companies and

their affiliated persons, as defined in

section 2(a)(3) of the Act. The Adviser

is an affiliated person of each Portfolio.

To the extent that the Portfolios are

deemed under common control by

reason of having the same investment

adviser, each Portfolio would be an

affiliated person of the other Portfolio

under section 2(a)(3)(C) of the Act.

Accordingly, purchases or sales of

securities between the International

Equity Portfolio and the Balanced

Portfolio may violate section 17(a).

Applicants request an exemption from

section 17(a) of the Act to the extent

necessary to permit them to redeem

shares in-kind as described in the

application.

6. Sections 6(c) and 17(b) of the Act

set forth the standards for exempting a

series of transactions from section 17(a).

Under section 17(b), the terms of the

transaction must be reasonable and fair

and must not involve overreaching on

the part of any person, the transaction

must be consistent with the policy of

each investment company concerned,

and the transaction must be consistent

with the general purposes of the Act. In

addition, under section 6(c), the

exemption must be necessary or

appropriate in the public interest,

consistent with the protection of

investors, and consistent with the

purposes fairly intended by the policy

and provisions of the Act.

7. Applicants believe that the

proposed transactions meet the

standards for relief under sections 6(c)

and 17(b). Applicants contend that the

terms of the proposed transactions are

reasonable and fair and do not involve

overreaching. The consideration paid

and received for the purchase and

redemption of International Equity

Portfolio shares will be based on the net

asset value of the International Equity

Portfolio. Currently, the Balanced

Portfolio will not incur any sales load or

other charge in purchasing shares of the

International Equity Portfolio.

Applicants believe that the proposed

transactions are consistent with the

policies of each Portfolio. The Balanced

Portfolio’s investments in the

International Equity Portfolio, and the

International Equity Portfolio’s issuance

of shares, will be effected in accordance

with each Portfolio’s investment

restrictions and policies. Applicants

also believe that the proposed

transactions are consistent with the

general purposes of the Act. Section

17(a) was intended to prohibit affiliated

persons from furthering their own

interests by, for example, selling

property to an investment company at

less than fair value. Applicants believe

that their proposal does not present

those concerns.

Applicants’ Conditions

Applicants agree that the order

granting the requested relief shall be

subject to the following conditions:

1. Applicants will comply with all

provisions of section 12(d)(1)(G), except

for section 12(d)(1)(G)(i)(II) to the extent

that it restricts the Balanced Portfolio

from investing in equity and fixed

income securities, and other

instruments as described in the

application.

2. Before approving any advisory

contract for the Balanced Portfolio

under section 15 of the Act, the

directors of the Fund, including a

majority of the directors who are not

‘‘interested persons’’ as defined in

section 2(a)(19) of the Act (the

‘‘Independent Directors’’), shall find

that the advisory fee, if any, charged

under the contract is based on services

provided that are in addition to, rather

than duplicative of, services provided

pursuant to the International Equity

Portfolio’s advisory contract. The

finding, and the basis upon which the

finding was made, will be recorded fully

in the minute books of the Fund.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–30862 Filed 11–24–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39333; File No. SR–AMEX–

97–36]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

American Stock Exchange, Inc.

Relating to Revised Equity Fee

Schedule

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 14, 1997,

the American Stock Exchange, Inc.

(‘‘Amex’’ or ‘‘Exchange’’) filed with the

Securities and Exchange Commission

the fee 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 fee change from

interested persons.
62796 Federal Register / Vol. 62, No. 227 / Tuesday, November 25, 1997 / Notices

1 Very recently (see SR–AMEX–97–34) the

Exchange had extended a PER fee waiver to

customer orders up to 5,099 shares in all exchangetraded fund products (‘‘EXTRA Funds’’). This fee

schedule change was not implemented and is being

replaced by the fee schedule revisions being made

herein.

2 15 U.S.C. 78f(b)(4).

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

4 17 CFR 19b–4(e).

5 17 CFR 200.30–3(a)(12).

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The Amex has revised its schedule of

fees imposed on trades in Standard &

Poor’s Depositary Receipts (‘‘SPDRs’’)

and Standard & Poor’s MidCap

Depositary Receipts (‘‘MidCap

SPDRs’’). The text of the fee change is

available at the Office of the Secretary,

the Amex 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 fee change and

discussed any comments it received on

the fee 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 the

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The Exchange currently imposes a

transaction charge and a regulatory fee

on trades in equity securities executed

on the Exchange. The Exchange’s equity

transaction charge is a two-part fee

consisting of a share charge and a value

charge, based on the total number of

shares traded and the value of such

shares, respectively. All equity trades

executed through the Exchange’s Post

Execution Reporting (‘‘PER’’) order

routing system up to 1,099 shares are

exempt from Exchange equity

transaction charges (excluding only

those for the account of non-member

competing dealers). The Exchange also

imposes a separate regulatory fee on all

equity trades calculated at .00005 times

the total value of shares traded.

The Exchange is now making

revisions to its schedule of fees relative

to trades on the Exchange in SPDRs and

MidCap SPDRs. The Exchange will

charge a different and separate fee

which will vary depending on for whom

the trade was executed. Specialists will

be charged a transaction fee of $.006 per

share ($.60 per 100 shares), capped at

$300 per trade. Registered Traders will

be charged a transaction fee of $.007 per

share ($.70 per 100 shares), capped at

$350 per trade. Off-floor orders (both

customer and broker-dealer) will be

charged a transaction fee of $.006 per

share ($.60 per 100 shares), capped at

$100 per trade.

In addition to the foregoing, orders up

to 5,099 shares in SPDRs and MidCap

SPDRs routed to the Exchange Floor

electronically through the Exchange’s

PER System will not be assessed a

transaction fee.1 However, the new fee

schedule will operate on a principle

consistent with that applied in the

context of the Exchange’s current fee

waiver in equities generally for PER

orders up to 1,099 shares, in that the

various fee waivers in SPDRs and

MidCap SPDRs will not be available to

PER orders for the account of a nonmember competing marketmaker.

These changes are calculated to lower

costs to users of the products while

making the cost of trading on the

Exchange comparable to the economics

of trading this and functionally similar

products in other markets. The revised

equity fee schedule was implemented

by the Exchange on October 29, 1997.

The Exchange will notify member firms

as to the date of effectiveness and as to

any necessary modifications to provide

for proper identification of orders

entitled to the fee exemption.

2. Statutory Basis

The fee change is consistent with

Section 6(b) of the Act in general and

furthers the objectives of Section

6(b)(4) 2 in particular in that it is

intended to assure the equitable

allocation of reasonable dues, fees, and

other charges among members, issuers,

and other persons using the Exchange’s

facilities.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The fee 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 fee

change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The foregoing rule change establishes

or changes a due, fee or other imposed

by the Exchange and, therefore, has

become effective pursuant to Section

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

subparagraph (e)(2) of the Rule 19b–4

thereunder.4 At any time within 60 days

of the filing of such fee change, the

Commission may summarily abrogate

such fee 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.

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, N.W.,

Washington, DC 20549. Copies of the

submission, all subsequent

amendments, all written statements

with respect to the fee change that are

filed with the Commission, and all

written communications relating to the

fee 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 in Washington, DC. Copies of

such filing will also be available for

inspection and copying at the principal

office of the Amex. All submissions

should refer to File No. SR–AMEX–97–

36 and should be submitted by

December 16, 1997.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.5

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–30864 Filed 11–24–97; 8:45 am]

BILLING CODE 8010–01–M

DEPARTMENT OF STATE

[Public Notice No. 2654]

Shipping Coordinating Committee

International Maritime Organization

(IMO) Legal Committee; Notice of

Meeting

The U.S. Shipping Coordinating

Committee (SHC) will conduct an open

meeting at 10:00 a.m., on Thursday,

December 4, 1997, in Room 2415 at U.S.

Coast Guard Headquarters, 2100 Second

Street, S.W., Washington, D.C. The

purpose of this meeting is to report on