55448 Federal Register / Vol. 62, No. 206 / Friday, October 24, 1997 / Notices

(June 18, 1997), 62 FR 34334 (June 25, 1997)

(approving a NYSE proposal to reduce the

minimum trading variation from 1⁄8 to 1⁄16).

6 15 U.S.C. § 78s(b)(2).

7 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3On the day following an Exchange holiday such

as the Friday following Thanksgiving or the day

after Christmas day, trading commences at 8:00 a.m.

rather than 2:30 a.m.

4See Securities Exchange Act Release No. 37732

(September 26, 1996). The proposed rule change

adjusted the trading hours for all customized

options such that all customized options would

cease trading on expiration day at 8:00 a.m. eastern

time and would expire at 10:15 a.m. eastern time.

5 17 CFR 240.19b–4(e)(6).

equal price improvement opportunities

for all investors and removes the

mechanism that currently deprives

those investors who trade securities

priced in less than 1⁄8 increments from

potentially obtaining a better price. In

addition, the language of the

modification obviates the need for

similar technical rule adjustments in the

future as the minimum trading and

quoting increments are further reduced.

The Commission finds good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice thereof in the

Federal Register. The Commission notes

that the AMEX and NYSE recently

reduced the minimum trading and

quotation variations for securities traded

through their facilities. As a result,

equity securities that previously traded

in minimum variations of 1⁄8 now trade

in minimum variations of 1⁄16. It is

important, therefore, that the Rules of

the MAX system be conformed to allow

customers the maximum opportunity for

price improvement in the MAX System

as soon as possible.

It is therefore ordered, pursuant to

Section 19(b)(2) 6 of the Act, that the

proposed rule change, SR–CHX–97–22,

is hereby approved on an accelerated

basis.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.7

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–28238 Filed 10–23–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39254; File No. SR–Phlx–

97–47]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Philadelphia Stock Exchange, Inc.

Proposing to Amend its Foreign

Currency Option Trading Hours

Respecting Customized Foreign

Currency Options

October 17, 1997.

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

Securities Exchange Act of 1934,1 notice

is hereby given that on October 7, 1997,

the Philadelphia Stock Exchange Inc.

filed with the Securities and Exchange

Commission 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

The Philadelphia Stock Exchange,

Inc. (‘‘Phlx’’ or the ‘‘Exchange’’)

pursuant to Rule 19b–4 of the Securities

Exchange Act of 1934 (‘‘Act’’) 2 proposes

to cease trading for expiring customized

currency options at 8:10 a.m. eastern

time on business days in which the

Foreign Currency Floor of the Exchange

opens for trading at 8:00 a.m. eastern

time. The text of the proposed rule

change is available at the Office of the

Secretary, the Phlx, and 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

1. Purpose

The Foreign Currency floor is open

from 2:30 a.m. eastern time to 2:30 p.m.

eastern time every business day.

However, the Exchange may open the

foreign currency floor at 8:00 a.m. on

some business days, usually on business

days following a holiday.3 The

Exchange modified the trading hours for

all customized options such that an all

expiring customized option contract

cease trading at 8:00 a.m. and expires at

10:15 a.m. eastern time.4 However, this

practice prevents the holder of an

expiring customized currency option to

offset an expiring position on days in

which trading begins at 8:00 a.m. on the

Foreign Currency floor. Therefore, the

Exchange proposes to cease trading in

expiring customized contracts at 8:10

a.m. on business days in which the

Exchange opens at 8:00 a.m. and thereby

provides a 10 minute window for a

participant to offset an expiring option.

The Phlx will provide notification of the

change in trading hours for these

expiring options by means of

memoranda to the membership.

2. Statutory Basis

The Exchange believes that the

proposed rule change is consistent with

Section 6(b)(5) of the Act in that it is

designed to remove impediments to and

perfect the mechanism of a free and

open market by providing the

participants with the ability to offset

their position prior to expiration on

those business days in which the

Foreign Currency floor opens at 8:00

a.m. eastern time.

B. Self-Regulatory Organization’s

Statement on the Burden on

Competition

The Phlx does not believe that the

proposed rule change will impose any

inappropriate 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 at the time of the filing.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The Exchange has asserted that the

proposed rule change (i) will not

significantly affect the protection of

investors or the public interest, (ii) will

not impose any significant burden on

competition, and (iii) will not become

operative for 30 days after the date of

this filing. For the foregoing reasons and

because the Exchange provided at least

five business days notice to the

Commission of its intent to file this

proposed rule change, the rule filing

will become operative as a ‘‘noncontroversial’’ rule change pursuant to

Rule 19b–4(e)(6) under the Act.5

At any time within 60 days of the

filing of such proposed rule change, the

Commission may summarily abrogate

such rule change if it appears to the
Federal Register / Vol. 62, No. 206 / Friday, October 24, 1997 / Notices 55449

6 17 CFR 200.30–3(a)(12).

1 15 U.S.C. § 78s(b)(1).

2See Securities Exchange Act Release No. 38960

(Aug. 22, 1997), 62 FR 45904 (Aug. 29, 1997).

3As part of its revised governance structure, the

Exchange eliminated the Disciplinary Review

Committee. Id.

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, 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

Section, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office at the PHLX. All submissions

should refer to File No. SR–PHLX–97–

47, and should be submitted by

November 14, 1997.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–28174 Filed 10–23–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39258; File No. SR–PHLX–

97–40]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Philadelphia Stock Exchange, Inc.

Relating to the Amendment of

Exchange Rules to Comply With

Recent Modifications to the By-Laws of

the Exchange

October 20, 1997.

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

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

September 24, 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 Exchange. 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

The Exchange seeks to amend

Exchange Rules 500 and 960.9 to

comply with recent modifications made

to the By-Laws of the Exchange.

The text of the proposed rule change

is available at the Office of the

Secretary, the Exchange and 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

Exchange 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

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

The Exchange recently received

regulatory approval to revise the

governance structure of the Exchange.2

As part of the restructuring, revisions

were made to the By-Laws and Articles

of Incorporation of the Exchange. In its

proposed rule change, the Exchange

seeks to make corresponding revisions

to two of its rules, Rule 500 and Rule

960.9, to conform to the new By-Laws

where necessary. The proposed

amendments would modify rules that

concern the structure and procedures of

two of the Exchange’s standing

committees, the Allocation, Evaluation

and Securities Committee (‘‘AES

Committee’’) and the Business Conduct

Committee (‘‘BC Committee’’).

Rule 500 (Allocation, Evaluation and

Securities Committee)

The Exchange proposes to revise Rule

500 to specify the revised composition

of the AES Committee. Under the prior

version of By-Law Article X, Section

10–7, the AES Committee was

composed of five core members and

twenty members of an allocation panel.

Under revised By-Law Article X,

Section 10–7, there may only be nine

members on the Committee. Of those

nine members, some will be core

members who serve three year terms

while others will be annual members

who may serve up to three consecutive

one year terms. Revised By-Law Article

X, Section 10–7 refers to Exchange Rule

500 for the number and categories of

persons eligible to serve as core

members and annual members. Because

Rule 500 currently provides that there

will be five core members and twenty

panel members, it must be modified to

comply with the terms of revised ByLaw Article X, Section 10–7 which

provides for a total of nine members on

the AES Committee. The Exchange

proposes to maintain the same number

of core members, five, and the same

selection categories for core members:

(i) three persons who conduct a public

securities business; (ii) one person who

is active on the equity trading floor as

a specialist or floor broker; and (iii) one

person who is active on the options

trading floor as a specialist, registered

options trader or floor broker. Rule 500

would be amended to require that of the

four annual members: (i) one be active

on the equity trading floor as a specialist

or floor broker; (ii) one be active on the

equity options trading floor as a

registered options trader; (iii) one be a

public Governor; and (iv) one be a nonindustry Governor.

Rule 960.9 (Business Conduct

Committee)

The Exchange proposes to amend

Rule 960.9 by revising the provisions

that set forth the appeal procedure for

decisions rendered by the Business

Conduct Committee. Under revised ByLaw Article X, Section 10–11, appeals

from the Business Conduct Committee

will now go directly to the Board of

Governors rather than the Disciplinary

Review Committee.3 Accordingly, Rule

960.9 is being amended to provide that

a Respondent who wishes to appeal a

decision of the Business Conduct

Committee must now comply with the

appeal procedures set forth in By-Law

Article XI, Section 11–1 which governs

appeals from all committees of the

Board.