[Federal Register Volume 62, Number 30 (Thursday, February 13, 1997)]
[Notices]
[Pages 6824-6825]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-3623]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38257; File No. SR-PSE-97-04]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendment No. 1 to the 
Proposed Rule Change by the Pacific Stock Exchange, Inc., Relating to 
Late SIPC Reports

February 7, 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 January 28, 1997, the Pacific Stock Exchange, Inc. (``PSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II 
and III below, which Items have been prepared by the PSE.\3\ The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. Sec. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ On February 4, 1997, the PSE submitted a technical amendment 
that (1) designates the provisos in PSE Rule 2.12(b) as (A) and (B); 
and (2) replaces references in PSE Rules 10.13(j)(2) and 
10.13(k)(iii)(2) to PSE Rule 2.12(a) with references to PSE Rule 
2.12(b). See Letter form Michael D. Pierson, Senior Attorney, 
Regulatory Policy, PSE, to Yvonne Fraticelli, OMS, Division of 
Market Regulation, Commission, dated February 3, 1997 (``Amendment 
No. 1'').
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The PSE proposes to amend paragraph (b)(2) of PSE Rule 2.12, 
``Financial Reports,'' and paragraph (k)(2) of PSE Rule 10.13, ``Minor 
Rule Plan,'' to replace references to ``Form SIPC-6'' and ``Form SIPC-
7'' with general references to ``Securities Investor Protection 
Corporation (``SIPC'') forms and assessments'' or ``such forms and 
assessments as are required pursuant to the Securities Investor 
Protection Act of 1970 (``SIPA'').''
    The text of the proposed rule change is available at the office of 
the Secretary, PSE, 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 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 the 
Statutory Basis for, the Proposed Rule Change

(a) Purpose
    Currently, PSE Rule 2.12(b)(2) requires members to file with the 
Exchange a Form SIPC-6 or Form SIPC-7 pursuant to SIPA.\4\ PSE Rule 
2.12(b)(2) provides a late filing charge for members who fail to file 
such documents in a timely manner.\5\ In addition, PSE Rule 2.12(b)(2) 
provides that a member who files its Form SIPC-6 or Form SIPC-7 within 
five business days of receipt of SIPC's final late notice is subject to 
a fine pursuant to PSE Rule 10.13,\6\ and that a member who fails to 
file its Form SIPC-6 or Form SIPC-7 within five business days after its 
receipt of SIPC's final late notice is subject to formal disciplinary 
action pursuant to PSE Rule 10.4, ``Hearing.'' \7\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release Nos, 33347 (December 15, 
1993), 58 FR 67888 (December 22, 1993) (order approving File No. SR-
PSE-93-21) (adopting charges for late filing of SIPC-6 and SIPC-7 
reports); and 32510 (June 24, 1993), 58 FR 335491 (July 1, 1993) 
(order approving File No. SR-PSE-92-15) (approving amendment to the 
Exchange's Minor Rule Plan relating to late SIPC reports).
    \5\ Under PSE Rule 2.12(b)(2), the charge for late filings are 
as follows: (1) $200.00 for reports that are 1 to 30 days late; (2) 
$400.00 for reports that are 31 to 60 days late; and (3) $800.00 for 
reports that are 61 to 90 days late.
    \6\ The fines under PSE Rule 10.13 are: (1) $1,200.00 for a 
first violation: (2) $1,800.00 for a second violation; and (3) 
$2,400.00 for a third violation.
    \7\ In addition, PSE Rule 10.13(j)(2) provides that the failure 
to file a Form SIPC-6 or Form SIPC-7 within five days after the 
receipt of SIPC's final notice will result in a formal disciplinary 
action.
---------------------------------------------------------------------------

    The Exchange purposes to amend PSE Rules 2.12(b)(2) and 10.13 (j) 
and (k) to replace references to ``Form SIPC-6'' and ``Form SIPC-7'' 
with general references to ``SIPC form and assessment'' and ``such 
forms and assessments as are required'' pursuant to SIPA. The Exchange 
is taking this action because SIPC recently has replaced Forms SIPC-6 
and SIPC-7 with Form SIPC-4. The Exchange believes that the use of a 
general reference to SIPC filings, rather than references to specific 
SIPC forms, will obviate the need for additional rule

[[Page 6825]]

changes in the event that SIPC again changes its form. The Exchange 
also is adding a reference to SIPC ``assessments'' in order to clarify 
the subject rules, consistent with the PSE's long-standing 
interpretation that a SIPC filing with the Exchange is complete only if 
it includes an assessment.
(b) Basis
    The PSE believes that the proposal is consistent with Section 6(b) 
of the Act, in general, and with Sections 6(b)(5) and 6(b)(6), in 
particular, in that it is designed to promote just and equitable 
principles of trade and to ensure that members will be appropriately 
disciplined for violations of Exchange rules.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    The PSE does not believe that the proposed rule change will impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    Written comments on the proposed rule change were neither solicited 
or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing rule change and Amendment No. 1 to the rule 
change constitute a stated policy, practice or interpretation with 
respect to the meaning, administration, or enforcement of an existing 
PSE rule, the proposal and Amendment No. 1 to the proposal have become 
effective pursuant to Section 19(b)(3)(A) of the Act and subparagraph 
(e) of Rule 19b-4 thereunder. 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 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 in 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 of the Exchange. All 
submissions should refer to File No. SR-PSE-97-04 and should be 
submitted by March 6, 1997.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-3623 Filed 2-12-97; 8:45 am]
BILLING CODE 8010-01-M