Federal Register / Vol. 62, No. 242 / Wednesday, December 17, 1997 / Notices 66157

9 17 CFR 200.30–3(a)(12).

1The Commission approved the Regulatory

Circular (Regulatory Circular 96–73) containing the

current OEX telephone policy on July 26, 1996. See

Securities Exchange Act Release No. 37487 (July 26,

1996), 61 FR 40686 (August 5, 1996) (order

approving File No. SR–CBOE–96–14).

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 submission

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of the

submissions, 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, NW.,

Washington, DC. Copies of such filing

also will be available for inspection and

copying at the CBOE. All submissions

should refer to File No. SR–CBOE–97–

62 and should be submitted by January

7, 1998.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.9

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–32918 Filed 12–16–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39435; File No. SR–CBOE–

97–55]

Self-Regulatory Organizations; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change by the Chicago Board

Options Exchange, Inc., Relating to the

Telephone Policy for the S&P 100

Index (‘‘OEX’’) Options Post

December 11, 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 9, 1997,

the Chicago Board Options Exchange,

Inc. (‘‘CBOE’’ or ‘‘Exchange’’) filed with

the Securities and Exchange

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

the proposed rule change as described

in Items I and II below, which Items

have been prepared by the selfregulatory organization. The

Commission is publishing this notice to

solicit comments on the proposed rule

change from interested persons and

approving this proposal on an

accelerated basis.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The CBOE proposes to amend its

current policy governing the use of

member-owned or Exchange-owned

telephones located at the post where

Standard & Poor’s 100 Index (‘‘OEX’’)

options are traded to allow market

makers to receive incoming telephone

calls from locations outside the CBOE

building on telephones at the OEX

post.1

The text of the regulatory circular 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

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

The purpose of the proposed rule

change is to amend the Exchange’s

current regulatory circular (Regulatory

Circular 96–73) governing the use of

telephones at the OEX option trading

post by eliminating the restriction

against market makers receiving

incoming calls at the OEX post from

locations outside of the Exchange

building. According to the CBOE, when

the OEX Floor Procedure Committee

(‘‘Committee’’) recommended that the

Exchange adopt a policy prohibiting

market makers from receiving incoming

calls at the OEX post, the Committee

was concerned that the receipt of

telephone calls would interfere with the

market makers’ fulfillment of their

duties to make markets and fill orders.

However, the CBOE notes that all other

trading posts on the CBOE’s floor have

successfully allowed market makers to

receive incoming calls without any

detrimental effects on the conduct of

business at those locations. In fact, the

Exchange has found that allowing

market makers to receive incoming calls

can allow them to stay in contact with

outside parties who can provide

information to the market makers that

may assist them in performing their

duties.

The proposed change to allow market

makers to receive incoming calls will

make the OEX telephone policy

consistent with the telephone policy at

all other trading locations on the

CBOE’s floor in this respect. Under the

proposal, the Exchange will allow

market makers to have their own

dedicated telephone or telephone line if

space permits. The Exchange will retain

the discretion to decide whether a

market maker may have its own

telephone or a dedicated line on an

Exchange telephone depending on the

space restrictions in the post.

The Exchange also is amending the

OEX telephone installation application

and agreement to reflect the proposed

change.

The Exchange believes the proposed

rule change will allow market makers to

better perform their duties by giving

them more open access to outside

information. In addition, the proposed

change will make the OEX telephone

policy consistent with the policies

elsewhere on the Exchange floor. For

the foregoing reasons, the Exchange

believes the rule proposal is consistent

with and furthers the objectives of

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

designed to perfect the mechanisms of

a free and open market and to protect

investors and the public interest by

providing better access to the OEX post.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

The CBOE does not believe that the

proposed rule change will impose any

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. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The CBOE has requested that the

proposed rule change be given

accelerated effectiveness pursuant to
66158 Federal Register / Vol. 62, No. 242 / Wednesday, December 17, 1997 / Notices

2The Commission approved the CBOE’s proposal

to incorporate its telephone policy for equity

options into the rules of the Exchange in 1994. See

Securities Exchange Act Release No. 33701 (March

2, 1994), 59 FR 11336 (March 10, 1994) (order

approving File No. SR–CBOE–93–24) (‘‘Equity

Option Approval Order’’).

3 15 U.S.C. 78f(b)(5)(1988).

4 In approving this rule, the Commission notes

that it has considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

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

5Telephone conversation among Timothy

Thompson, Senior Attorney, CBOE, Pat Cerny,

Market Surveillance, CBOE, and Yvonne Fraticelli,

Attorney, Office of Market Supervision, Division of

Market Regulation, Commission, on November 18,

1997 (‘‘November 18 Conversation’’).

6See Equity Option Approval Order, supra note

2.

7 15 U.S.C. 78f.

8 15 U.S.C. 78s(b)(2).

9 17 CFR 200.30–3(a)(12).

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

2The Commission has modified the text of the

summaries prepared by DTC.

Section 19(b)(2) of the Act. According to

the CBOE, the proposed change is

consistent with the use of telephones at

other locations on the CBOE floor,

including at the equity option telephone

posts, where the use of telephones is

governed by a policy approved by the

Commission.2

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, the

requirements of Section 6(b)(5) 3 in that

it is designed to promote just and

equitable principles of trade, prevent

fraudulent and manipulative acts and

practices, and maintain fair and orderly

markets.4 Specifically, the CBOE has

represented that allowing OEX market

makers to receive incoming calls from

outside the CBOE building may allow

OEX market makers to receive

information that will assist OEX market

makers in performing their duties. In

addition, the proposal will make the

OEX telephone policy regarding market

makers’ receipt of incoming calls

consistent with the telephone policies at

all other trading locations on the CBOE

floor.

The Commission believes that it is

reasonable for the Exchange to amend

its telephone policy for OEX market

makers to make the policy consistent

with the procedures applicable to all

other trading locations on the CBOE has

indicated that market makers’ receipt of

incoming calls at other trading posts on

the CBOE floor. In this regard, the

Commission notes that the CBOE floor

has produced no detrimental effect on

the conduct of business at those trading

posts. In addition, the CBOE states that

the Exchange has not detected any

improper trading activity resulting from

its telephone policies.5 The Commission

believes, as it found in approving the

CBOE’s telephone policy for equity

options, that the Exchange’s existing

surveillance procedures will ensure that

the CBOE is aware of any options

transactions that raise manipulation

concerns.6 Accordingly, the

Commission believes that the CBOE’s

modification of its telephone policy for

OEX market makers will not diminish

the Exchange’s ability to detect and

deter manipulation.

The Commission finds good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice of filing thereof

in the Federal Register. Accelerated

approval will allow the CBOE to

implement a uniform policy regarding

market makers’ receipt of incoming calls

at their trading posts. Accordingly, the

Commission believes that granting

accelerated approval to the proposal is

appropriate and consistent with Section

6 of the Act.7

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views and

argument 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, 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 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, N.W.,

Washington, D.C. Copies of such filing

will also be available for inspection and

copying at the principal office of the

above-mentioned self-regulatory

organization. All submissions should

refer to File No. SR–CBOE–97–55 and

should be submitted by January 7, 1998.

It Is Therefore Ordered, pursuant to

Section 19(b)(2) of the Act,8 that the

proposed rule change (File No. SR–

CBOE–97–55) is approved on an

accelerated basis.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.9

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–32920 Filed 12–16–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39422; File No. SR–DTC–

97–20]

Self-Regulatory Organizations; The

Depository Trust Company; Notice of

Filing and Order Granting Accelerated

Approval of a Proposed Rule Change

Expanding the Money Market

Instrument Settlement Program

December 19, 1997.

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

Securities Exchange Act of 1934

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

September 22, 1997, The Depository

Trust Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) and on November 13,

1997, amended the proposed rule

change (File No. SR–DTC–97–20) as

described in Items I and II below, which

items have been primarily prepared by

DTC. 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 on

a permanent basis.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The proposed rule change seeks

permanent approval of DTC’s expanded

money market instrument (‘‘MMI’’)

settlement program. The Commission

previously approved DTC’s expanded

MMI program on a temporary basis.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

DTC included statements concerning

the purpose of and basis for the

proposed rule change and discussed any

comments that it received on the

proposed rule change. The text of these

statements may be examined at the

places specified in Item IV below. DTC

has prepared summaries, set forth in

sections (A), (B), and (C) below, of the

most significant aspects of such

statements.2