6290 Federal Register / Vol. 62, No. 28 / Tuesday, February 11, 1997 / Notices

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

2 17 CFR 240.19b–4.

3See Securities Exchange Act Release No. 34277

(June 29, 1994), 59 FR 34885 (July 7, 1994) (‘‘Short

Sale Rule Approval Order’’).

4See Securities Exchange Act Release Nos. 36171

(August 30, 1995), 60 FR 46651; 36532 (November

30, 1995), 60 FR 62519; 37492 (July 29, 1996), 61

FR 40693; and 37919 (November 1, 1996), 61 FR

57934.

5See NASD Rule 3350.

6Pursuant to NASD Rule 4612, the PMM

standards require a market maker to satisfy at least

two of the following four criteria to be eligible for

an exemption from the short sale 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.

Specifically, the proportionate volume test requires

a market maker to account for volume of at least 11⁄2

times its proportionate share of overall volume in

the security for the review period. For example, if

a security has 10 market makers, each market

maker’s proportionate share volume is 10 percent.

Therefore, the proportionate share volume is oneand-a-half times 10, or 15 percent of overall

volume. But, see Securities Exchange Act Release

No. 38175 (January 15, 1997) (Commission

approving NASD rule proposal to waive the PMM

qualification standards in conjunction with the

adoption of the Commission’s Order Execution

Rules); and File No. SR–NASD–97–07 (January 31,

1997) (Proposed rule change to temporarily suspend

the use of the Primary Market Maker qualification

criteria for all Nasdaq market maker securities for

the remainder of the current pilot period of the

Nasdaq short sale rule).

7See Securities Exchange Act Release no. 38175

(January 15, 1997), stating that the NASD will, upon

suspension of the PMM qualification criteria for

NNM securities, deem all registered market makers

in such securities PMMs.

8Specifically, the footnote to NASD Rule

6130(d)(6) provides that ‘‘[t]he ‘sell short’ and ‘sell

short exempt’ indicators must be entered for all

customer short sales, including cross transactions,

and for short sales effected by members that are not

qualified market markers pursuant to Rule 3350.’’

9 15 U.S.C. 78o–3(b)(6).

10See footnote 6, supra; and Letter from Howard

Kramer, Associate Director, Division of Market

Regulation, Commission, to Eugene A. Lopez,

Assistant General Counsel, NASD (February 3,

1997) (No-action letter regarding suspension of the

Primary Market Maker standards).

[Release No. 34–38240; File No. SR–NASD–

96–52]

Self-Regulatory Organizations;

National Association of Securities

Dealers, Inc.; Order Granting

Accelerated Approval of Proposed

Rule Change Relating to the Reporting

of Short Sale Transactions by Market

Makers Exempt From the NASD’s

Short Sale Rule

February 5, 1997.

I. Introduction

On December 17, 1996, the National

Association of Securities Dealers, Inc.

(‘‘NASD’’ or ‘‘Association’’) filed with

the Securities and Exchange

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

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

Securities Exchange Act of 1934

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

proposed rule change to the Automated

Confirmation Transaction (‘‘ACT’’)

Service rules that would require all

Primary Market Makers (‘‘PMM’’) to

mark their ACT reports to denote when

they have relied on the PMM exemption

to NASD’s short sale rule. The proposed

rule change was published for comment

in Securities Exchange Act Release No.

38092 (December 27, 1996), 62 FR 776

(January 6, 1997) (‘‘Notice of Proposed

Rule Change’’). The Commission

received no comments on the proposal

and is approving the proposed rule

change on an accelerated basis.

II. Description of the Proposal

On June 29, 1994, the Commission

approved the NASD’s short sale rule on

an eighteen-month pilot basis through

March 5, 1996.3 The Commission

subsequently extended the termination

date through October 1, 1997.4 The

NASD’s short sale rule prohibits

member firms from effecting short sales

in Nasdaq National Market (‘‘NNM’’)

securities at or below the current inside

bid as disseminated by Nasdaq

whenever the bid is lower than the

previous bid.5 The rule provides an

exemption from the short sale rule to

‘‘qualified’’ Nasdaq market makers who

can use the exemption only in

connection with bona fide market

making activity. To be a qualified

market maker, a market maker must

satisfy the Nasdaq PMM standards.6 If a

market maker is a PMM for a particular

stock, there is a ‘‘P’’ indicator next to its

quote in that stock.7

When the Commission approved the

NASD’s short-sale rule it also approved

an NASD proposal to require NASD

members to append a designator to their

ACT reports to denote whether their

sale transactions were long sales, short

sales, or exempt short sales. At that

time, however, market makers exempt

from the short-sale rule were not

required to append ‘‘sell short’’ or ‘‘sell

short exempt’’ to their ACT reports.8

Accordingly, in order to enhance the

NASD’s ability to surveil for potential

abuses of the market maker exemption

and examine and monitor the market

impacts of the market maker exemption,

the NASD’s proposed rule change

deletes the footnote to NASD Rule

6130(d)(6), thereby requiring all exempt

market makers to mark their ACT

reports to denote when they have relied

on the market maker exemption.

The NASD will establish an effective

date for the rule change in a Notice-toMembers announcing Commission

approval of the proposal. The Notice

will be published within thirty days of

Commission approval of the proposal

and the effective date of the proposal

will be no longer than three weeks after

the date of publication of the Notice.

III. Discussion

The Commission believes the NASD’s

proposed rule change is consistent with

Section 15A(b)(6) of the Act,9 and that

it will promote efficiency, competition,

and capital formation. Section 15A(b)(6)

requires that the rules of a national

securities association be designed to

promote just and equitable principles of

trade, to foster cooperation and

coordination with person 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. The Commission believes

that requiring exempt market makers to

mark their ACT reports to denote when

they have relied upon the PMM

exemption will help to enhance the

ability of NASD Regulation, Inc. to

efficiently monitor whether market

makers are abusing the exemption.10

Furthermore, the Commission, in

approving the short sale rule on a pilot

basis, requested the NASD to study

various aspects of the rule’s effects,

including the use of the PMM

exemption to the rule. The Commission,

therefore, believes that requiring PMMs

to append a designator to their ACT

reports will assist the NASD in

assessing the market impacts of the

PMM exemption from the short sale

rule, as well as facilitate the preparation

of a thorough analysis of such

exemption.

The NASD requested that the

Commission find good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice of the filing in

the Federal Register. The Commission

finds good cause for so approving the

proposed rule change because

accelerated approval will allow the

NASD to begin collecting the necessary

data for a meaningful statistical analysis

of the market impact of the PMM

exemption from the short sale rule.

Furthermore, the Commission believes

it is prudent to allow the NASD to begin

requiring PMMs to mark their ACT

reports when they have relied on the

PMM exemption as soon as possible in

order that the NASD and PMMs will

become familiar with the use of the ACT
Federal Register / Vol. 62, No. 28 / Tuesday, February 11, 1997 / Notices 6291

11 15 U.S.C. 78s(b)(2) (1988).

12 17 CFR 200.30–3(a)(12) (1995).

denotation, thereby aiding in efficient

data collection.

IV. Conclusion

For the foregoing reasons, the

Commission finds that the proposed

rule change is consistent with the Act

and the rules and regulations

thereunder applicable to the NASD, and

in particular Section 15A(b)(6).

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,11 that the

proposed rule change (File No. SR–

NASD–96–52) be and hereby is

approved on an accelerated basis.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.12

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–3326 Filed 2–10–97; 8:45 am]

BILLING CODE 8010–01–M

SMALL BUSINESS ADMINISTRATION

Data Collection Available for Public

Comments and Recommendations

ACTION: Notice and request for

comments.

SUMMARY: In accordance with the

Paperwork Reduction Act of 1995, this

notice announces the Small Business

Administration’s intentions to request

approval on a new, and/or currently

approved information collection.

DATES: Comments should be submitted

within 60 days of this publication in the

Federal Register.

FOR FURTHER INFORMATION CONTACT:

Curtis B. Rich, Management Analyst,

Small Business Administration, 409 3rd

Street, S. W., Suite 5000, Washington,

D. C. 20416. Phone Number: 202–205–

6629.

SUPPLEMENTARY INFORMATION:

Title: ‘‘Surety Bond Guaranty

Agreement, Preferred Lenders Program’’.

Type of Request: Extension of a

Currently Approved Collections.

Form No’s.: SBA Forms 990, 991, 994,

994, 994B, 994C, 994F, 994H.

Description of Respondents: Small

Business Contractors Applying for the

Surety Bond Guarantee Program.

Annual Responses: 55,000.

Annual Burden: 28,837.

Comments: Send all comments

regarding this information collection to

William Berry, Deputy Associate

Administrator, Office of Surety

Guarantees, Small Business

Administration, 409 3rd Street, S. W.,

Suite 8600 Washington, D.C. 20416.

Phone No.: 202–205–6549.

Send comments regarding whether

this information collection is necessary

for the proper performance of the

function of the agency, accuracy of

burden estimate, in addition to ways to

minimize this estimate, and ways to

enhance the quality.

Title: ‘‘Questionnaires for section 503

Development Company and Company

doing Business with a Section 503

Development Company’’.

Type of Request: Extension of

Currently Approved Collections.

Form No’s.: SBA Forms 1301, 1302.

Description of Respondents: State and

Local Development Companies.

Annual Responses: 90.

Annual Burden: 180.

Title: ‘‘Statement of Personal

History’’.

Type of Request: ‘‘Extension of

Currently Approved Collections’’.

Form No. SBA Form 912.

Description of Respondents:

Applicants for Assistance or Temporary

Employment in Disaster Office.

Annual Responses: 30,000.

Annual Burden: 2,500.

Comments: Send all comments

regarding these information collections

to Pat Anderson, Administrative Officer,

Office of the Inspector General, Small

Business Administration, 409 3rd Street,

S.W., Suite 7150 Washington, D.C.

20416. Phone No. 202–205–6580.

Send comments regarding whether

these information collections are

necessary for the proper performance of

the function of the agency, accuracy of

burden estimate, in addition to ways to

minimize this estimate, and ways to

enhance the quality.

Title: ‘‘SBIR Mailing List and

Confirmation Request and STTR

Mailing List and Confirmation’’.

Type of Request: Extension of

Currently Approved Collections.

Description of Respondents: Small

Businesses Interested Participating in

the SBIR/STTR Solicitation Process.

Form No’s.: SBA Forms 1386, 1906.

Annual Responses: 60,000.

Annual Burden: 500.

Comments: Send all comments to

Shirley F. Smith, Program Analyst,

Office of Technology, Small Business

Administration, 409 3rd Street, S.W.,

Suite 8150 Washington, D.C. 20416.

Phone No. 202–205–7295.

Send comments regarding whether

this information collection is necessary

for the proper performance of the

function of the agency, accuracy of

burden estimate, in addition to ways to

minimize this estimate, and ways to

enhance the quality.

Title: ‘‘Guidelines for Small Business

Award Nominations’’.

Type of Request: Extension of

Currently Approved Collections.

Description of Respondents:

Organizations Nominating a Small

Business Leader for Small Business

Advocacy Awards.

Form No. N/A.

Annual Responses: 500.

Annual Burden: 1,083.

Comments: Send all comments

regarding this information collection to

Janie Dymond, Administrative

Assistant, Office Public

Communications, Marketing and

Customer Service, Small Business

Administration, 409 3rd Street, S.W.,

Suite 7600 Washington, D.C. 20416.

Phone No. 202–205–6740.

Title: ‘‘Loan Closing Documents’’.

Type of Request: Extension of

Currently Approved Collections.

Description of Respondents: SBA

Loan Applicants.

Form No’s.: SBA Forms 147, 148, 159,

160, 160A, 529B, 928, 1059.

Annual Responses: 25,451.

Annual Burden: 152,706.

Comments: Send all comments

regarding this information collection to

Michael J. Dowd, Director, Office of

Loan Programs, Small Business

Administration, 409 3rd Street, S.W.

Suite 8300, Washington, D.C. 20416.

Phone No. 202–205–6570.

Send comments regarding whether

this information collection is necessary

for the proper performance of the

function of the agency, accuracy of

burden estimate, in addition to ways to

minimize this estimate, and ways to

enhance the quality.

Vanessa K. Smith,

Acting Chief, Administrative Information

Branch.

[FR Doc. 97–3279 Filed 2–10–97; 8:45 am]

BILLING CODE 8025–01–P

[Declaration of Disaster Loan Area #2925]

California; Declaration of Disaster

Loan Area, (Amendment #1)

In accordance with a notice from the

Federal Emergency Management

Agency, dated January 24, 1997, the

above-numbered Declaration is hereby

amended to include Alameda and San

Francisco Counties in the State of

California, as well as the City of Morgan

Hill which was previously omitted as a

disaster area due to damages caused by

severe storms, flooding, and mud and

land slides beginning on December 28,

1996 and continuing.

All counties contiguous to the abovenamed counties have been previously

declared.

All other information remains the

same, i.e., the termination date for filing