13728 Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Notices

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

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 38243

(February 5, 1997), 62 FR 6590.

4For purposes of this Rule, an ‘‘account’’ would

be deemed to be any account in which the same

person or persons is directly or indirectly

interested.

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

(301) 415–7848, email dbh@nrc.gov; or

Dr. S. Jones, (301)415–6198, email

szj@nrc.gov.

Although a time limit is given for

comments on these drafts, comments

and suggestions in connection with (1)

Items for inclusion in guides currently

being developed or (2) improvements in

all published guides are encouraged at

any time.

Regulatory guides are available for

inspection at the Commission’s Public

Document Room, 2120 L Street NW.,

Washington, DC. Requests for single

copies of final or draft guides (which

may be reproduced), or for placement

on an automatic distribution list for

single copies of future draft guides in

specific divisions, should be made in

writing to the U.S. Nuclear Regulatory

Commission, Washington, DC 20555,

Attention: Director, Distribution and

Mail Services Section, or by fax at (301)

415–2260. Telephone requests cannot be

accommodated. Regulatory guides are

not copyrighted, and Commission

approval is not required to reproduce

them.

(5 U.S.C. 552(a))

Dated at Rockville, Maryland, this 4th day

of March 1997.

For the Nuclear Regulatory Commission.

Bill M. Morris,

Director, Division of Regulatory Applications

Office of Nuclear Regulatory Research.

[FR Doc. 97–7180 Filed 3–20–97; 8:45 am]

BILLING CODE 7590–01–P

SECURITIES AND EXCHANGE

COMMISSION

Sunshine Act Meeting

Notice is hereby given, pursuant to

the provisions of the Government in the

Sunshine Act, Pub. L. 94–409, that the

Securities and Exchange Commission

will hold the following closed meeting

during the week of March 24, 1997.

A closed meeting will be held on

Thursday, March 27, 1997, at 10:00 a.m.

Commissioners, Counsel to the

Commissioners, the Secretary to the

Commission, and recording secretaries

will attend the closed meeting. Certain

staff members who have an interest in

the matters may also be present.

The General Counsel of the

Commission, or his designee, has

certified that, in his opinion, one or

more of the exemptions set forth in 5

U.S.C. 552b(c)(4), (8), (9)(A) and (10)

and 17 CFR 200.402(a)(4), (8), (9)(i) and

(10), permit consideration of the

scheduled matters at the closed meeting.

Commissioner Johnson, as duty

officer, voted to consider the items

listed for the closed meeting in a closed

session.

The subject matter of the closed

meeting scheduled for Thursday, March

27, 1997, at 10:00 a.m., will be:

Institution and settlement of injunctive

actions.

Institution and settlement of

administrative proceedings of an

enforcement nature.

At times, changes in Commission

priorities require alterations in the

scheduling of meeting items. For further

information and to ascertain what, if

any, matters have been added, deleted

or postponed, please contact: The Office

of the Secretary at (202) 942–7070.

Dated: March 19, 1997.

Jonathan G. Katz,

Secretary.

[FR Doc. 97–7390 Filed 3–19–97; 3:39 pm]

BILLING CODE 8010–01–M

[Release No. 34–38409; File No. SR–Amex97–02]

Self-Regulatory Organizations; Order

Granting Approval to Proposed Rule

Change by American Stock Exchange,

Inc., Relating to Amendments to Rules

103 and 950 Regarding Intra-day

Trading

March 14, 1997.

I. Introduction

On January 22, 1997, the American

Stock Exchange, Inc. (‘‘Amex’’ or

‘‘Exchange’’) submitted to the Securities

and Exchange Commission (‘‘SEC’’ or

‘‘Commission’’), 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

adopt provisions restricting intro-day

trading.

The proposed rule change was

published for comment in the Federal

Register on February 12, 1997.3 No

comments were received on the

proposal. This order approves the

proposal.

II. Description of the Proposal

Presently, Rule 103(c) prohibits an

Amex Floor member, with certain

exceptions, from exercising discretion

with respect to the choice of security to

be bought or sold, the total amount of

the security to be bought or sold, or

whether the transaction shall be a

purchase or sale. Currently, there are no

provisions in Rule 103(c), or otherwise,

specifically governing the practice of

intra-day trading. The term ‘‘intra-day

trading’’ refers to the practice whereby

a customer places orders on both sides

of the market and attempts to profit by

buying at the bid and selling at the offer.

The Exchange proposed to amend

Rule 103 to add new intra-day trading

provisions. These provisions will apply

only when a Floor member

simultaneously represents, for the same

customer’s account,4 market or limit

orders on both sides of a minimum

variation market. Under the proposal, if

a Floor member acquires a position on

behalf of an intra-day trader’s account,

Rule 103(c)(2) will place certain

restrictions on how the member can

liquidate or cover that position during

the same trading session. Specifically,

the member will be required to obtain

a new liquidating order (i.e., one

entered subsequent to the acquisition of

the contra-side position) from his or her

customer. The new order must be timerecorded both upstairs and upon receipt

on the Trading Floor.

Proposed Rule 103(c)(3) will require

the Floor member to execute the

liquidating order entered pursuant to

Rule 103(c)(2) before he or she can

execute any other order for the same

account on the same side of the market

as that liquidating order. Pursuant to

proposed Commentary .01 to Rule 103,

the new provisions will not apply,

however, to the execution of: an order

to liquidate or cover a position carried

over from a previous trading session; a

position assumed as part of a strategy

relating to bona fide arbitrage; or a

position assumed in reliance on the

exemption for block positioners.

Proposed Commentary .02 sets forth

examples of how the provisions of Rule

103(c)(2) and (3) will operate, while

proposed Commentary .03 details the

types of orders that a Floor member may

handle simultaneously, without

violating Rule 103’s prohibition against

a member choosing whether a

transaction will be a purchase or sale.

III. Discussion

After careful review, 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. Specifically, the

Commission believe the proposal is

consistent with the requirements of

Section 6(b)(5) of the Act.5
Federal Register / Vol. 62, No. 55 / Friday, March 21, 1997 / Notices 13729

6 Id.

7See New York Stock Exchange (‘‘NYSE’’) Rule

95; Securities Exchange Act Release No. 34363 (July

13, 1994), 59 FR 36808 (July 19, 1994) (order

approving the NYSE’s amendments to Rule 95

which added intra-day trading provisions). The

Commission incorporates by reference the

discussion and analysis contained in the July 1994

Release.

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.

3Securities Exchange Act Release No. 35720 (May

16, 1995), 60 FR 27360 [File No. SR–DTC–95–06]

(order granting accelerated approval of a proposed

rule change modifying DTC’s SDFS system).

4Original payment orders submitted between

3:00 p.m. and 3:20 p.m. are subject to RAD

regardless of their settlement value.

5Securities Exchange Act Release No. 36476

(November 9, 1995), 60 FR 57728 [File No. SR–

DTC–95–16] (notice of filing and order granting

accelerated approval of a proposed rule change

relating to the modification of DTC’s reclamation

procedures).

6A reclaim is deemed to be ‘‘matched’’ if its

corresponding original delivery was processed on

the current processing day or the preceding

business day.

The Commission believes the

proposal is consistent with Section

6(b)(5) 6 because it is designed to

promote just and equitable principles of

trade and to help perfect the mechanism

of a free and open market. As described

above, these new changes are intended

to address trading situations where a

Floor member, representing at the same

time buy and sell orders at the

minimum variation for the same

customer, may be perceived as having a

time and place advantage over other

market participants in that he or she

may be able to trade for the same

customer without leaving the Trading

Crowd. By requiring the entry of a new

liquidating order, the Commission

believes the proposed rule will

minimize any such perceived

advantage.

In addition, the proposed rule change

will conform the Exchange’s rules to the

rules of another exchange, which also

restricts intra-day trading.7

IV. Conclusion

It is therefore ordered, pursuant to

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

proposed rule change (SR–Amex-97–02)

is approved.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.9

Jonathan G. Katz,

Secretary.

[FR Doc. 97–7192 Filed 3–20–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38404; File No. SR–DTC–

97–03]

Self-Regulatory Organizations; The

Depository Trust Company; Notice of

Filing and Immediate Effectiveness of

a Proposed Rule Change to Modify the

Receiver Authorized Delivery and

Reclamation Procedures for Payment

Orders

March 14, 1997.

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

Securities Exchange Act of 1934

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

February 4, 1997, The Depository Trust

Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change (File No. SR–DTC–97–03) as

described in Items I, II, and III below,

which items have been prepared

primarily by DTC. 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 purpose of the proposed rule

change is to modify DTC’s Receiver

Authorized delivery (‘‘RAD’’)

procedures and reclamation procedures

with respect to payment orders.

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 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

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

The purpose of the proposal is to

modify DTC’s RAD procedures and

reclamation procedures with respect to

payment orders. DTC proposes (1) To

reduce the minimum bilateral RAD

threshold for payment orders from $15

million to $1 million, (2) to modify a

Participants Terminal System (‘‘PTS’’)

function (RADL) to enable a participant

to set a different RAD limit for payment

orders and deliver orders for each

contra-participant, and (3) to allow only

matched reclaims of payment orders

with a value less than $1 million to

bypass risk management controls (i.e.,

collateral monitor and net debit caps).

DTC is proposing this rule change in

order to reduce the risk to DTC and its

participants of failure-to-settle

situations.

In 1995, DTC modified its RAD

procedures in preparation for the sameday funds settlement (‘‘SDFS’’)

conversion.3 The modifications to RAD

procedures established a $15 million

minimum bilateral RAD limit one

participant can impose on another

participant. Under the modified

procedure, the receiver of a payment

order with a value of less than $15

million generally does not have an

opportunity to review and approve the

transaction.4 The RAD modifications

were implemented to minimize the

number of transactions subject to RAD

and the related possibility for

transaction blockage once all activities

were converted to SDFS.

DTC also modified its reclamation

procedures in preparation for the SDFS

conversion and in conjunction with the

modifications to RAD procedures to

ensure that this policy did not cause

undue burden on participants.5 Under

the modified reclamation procedures, a

matched reclaim 6 of a payment order or

deliver order with a settlement value

less than $15 million is currently not

subject to risk management controls.

However, payment orders differ from

deliver orders because payment orders

are ‘‘money-only’’ transactions and do

not involve securities. When a payment

order is processed, the receiver of the

payment order receives a settlement

debit but does not receive any securities

that could serve as collateral for the

debit incurred. Similarly, if a payment

order is reclaimed, the receiver of the

reclamation incurs a debit without

receiving offsetting securities as

collateral. DTC has determined that

there is more risk inherent in the

reclamation of payment orders than in

the reclamation of deliver orders

because the reclamation of payment

orders would more likely cause a

participant’s account to become

undercollateralized. Therefore, DTC

believes that a more conservative

approach with respect to RAD

procedures and reclamation procedures

is appropriate for payment orders.

Under the proposed rule change, RAD

procedures and reclamation procedures

for payment orders will be modified as

follows: (1) the minimum bilateral RAD

threshold for payment orders will be

reduced to $1 million from $15 million;

(2) the PTS function (RADL) will be

modified to enable a participant to set

a different RAD limit for payment orders