Federal Register / Vol. 62, No. 62 / Tuesday, April 1, 1997 / Notices 15559

8 15 U.S.C. 78f(b)(5).

9 15 U.S.C. 78f(b)(7).

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

2The Commission has modified the text of the

summaries prepared by OCC.

Chairman, President, and all governors

who have already served on the Initial

Determination Panel or Hearing Panel

convened in connection with a

disciplinary matter to be reviewed. Two

of the five members of the Judiciary

Committee will be non-member (public)

governors. The proposed rule change

also amends Article VII, Rule 5(a) in

order to clarify that the President’s

power of emergency suspension extends

to persons associated with members, in

addition to members and member

organizations. The Exchange believes

that this change codifies the Exchange’s

authority, as set forth in Section 6(b)(6)

of the Act, in CHX rules.

The Exchange proposes that the

proposed rule change become effective

sixty days after approval by the

Commission. This time period will give

the Exchange adequate time to

implement the new procedures and

appoint a Hearing Pool. The Exchange

proposes that, in general, if a

disciplinary action has commenced and

is pending as of the date of effectiveness

of the proposed rule change, all of the

new rules and procedures should apply.

However, if a Hearing Officer has

already been appointed pursuant to the

old rules then the old hearing rules

should apply. In any event, so long as

no appeal has been filed by the date of

effectiveness of the proposal, the new

appellate rules and procedures shall

apply except that, if a Hearing Officer

presided at the hearing, references in

the appeal rules to decisions of the

Initial Determination panel or Hearing

Panel, as the case may be, should be

changed to ‘‘hearing officer and final

judgment of the President.’’

2. Statutory Basis

The Exchange believes that the

proposed rule change is consistent with

Section 6(b)(5) of the Act 8 in that it is

designed to promote just and equitable

principles of trade, to foster cooperation

and coordination with persons engaged

in regulating securities transactions, to

remove impediments to and perfect the

mechanism of a free and open market

and a national market system and, in

general, to protect investors and the

public interest. The proposed rule

change is also consistent with Section

6(b)(7) of the Act 9 in that it provides a

fair procedure for the disciplining of

members and persons associated with

members.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange 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 either

solicited or received.

III. Date of Effectiveness of Proposed

Rule Change and Timing for

Commission Action

Within 35 days of the publication of

this notice in the Federal Register or

within such longer period: (i) As the

Commission may designate up to 90

days of such date if it finds such longer

period to be appropriate and publishes

its reasons for so finding; or (ii) as to

which the self-regulatory organization

consents, the Commission will:

(A) by order approve the proposed

rule change, or

(B) institute proceedings to determine

whether the proposed rule change

should be disapproved.

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, 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 for inspection and copying at

the Commission’s Public Reference

Room. 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–CHX–96–31 and should be

submitted by April 22, 1997.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–8231 Filed 3–31–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38421; File No. SR–OCC–

97–03]

Self-Regulatory Organizations; The

Options Clearing Corporation; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change Modifying The Options

Clearing Corporation’s Restated

Certificate of Incorporation and ByLaws

March 19, 1997.

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

Securities Exchange Act of 1934

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

February 18, 1997, The Options Clearing

Corporation (‘‘OCC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change as described in Items I and II

below, which Items have been prepared

primarily by OCC. The Commission is

publishing this notice and order to

solicit comments from interested

persons on the proposed rule change

and to grant accelerated approval of the

proposed rule change.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The proposed rule change modifies

OCC’s Restated Certificate of

Incorporation and By-Laws to extend

each public director’s term on OCC’s

Board of Directors (‘‘Board’’) from a

maximum of four consecutive years to a

maximum of six consecutive years.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

OCC 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. OCC 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 proposed rule

change is to modify OCC’s Restated

Certificate of Incorporation and By-Laws

in order to provide greater continuity of

leadership and more meaningful

representation on OCC’s Board by
15560 Federal Register / Vol. 62, No. 62 / Tuesday, April 1, 1997 / Notices

3Securities Exchange Act Release No. 31329

(October 16, 1992), 57 FR 48414.

4 15 U.S.C. 78q–1. 5 15 U.S.C. 78q–1(b)(3)(C). 6 17 CFR 200.30–3(a)(12).

extending each public director’s term on

the Board from a maximum of four

consecutive years to a maximum of six

consecutive years. Under the proposed

rule change, public directors elected

prior to 1999 shall serve a maximum of

three consecutive two-year terms, and

public directors elected in 1999 or

thereafter shall serve a maximum of two

consecutive three-year terms. On

October 16, 1992, the Commission

approved a proposed rule change

extending a public director’s term from

one two-year term to two consecutive

two-year terms.3 OCC believes that the

reasons supporting Commission

approval of that proposed rule change

are very similar to the reasons for the

present proposed rule change. In

particular, OCC‘s business has been and

continues to be increasingly complex. A

public director may find that two twoyear terms are still insufficient time to

prepare for meaningful administration

and interpretation of OCC’s rules,

operations, and policies and for input of

meaningful guidance once the public

director has gained the necessary

knowledge and expertise. Because each

public director’s term would be limited

to a total of six consecutive years,

diversity in that position will still be

preserved.

OCC believes the proposed rule

change is consistent with the

requirements of Section 17A of the Act 4

and the rules and regulations

thereunder because the proposed rule

change enhances the ability of public

directors to have meaningful input on

the Board and contributes to the fair

representation of OCC’s members in the

selection of its directors and

administration of its affairs.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

OCC 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

Written comment were not and are

not intended to be solicited with respect

to the proposed rule change and none

have been received.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Section 17A(b)(3)(C) of the Act states

that the rules of a clearing agency must

assure a fair representation of its

shareholders and participants in the

selection of its directors and

administration of its affairs.5 The

Commission believes that the proposed

modification to OCC’s Restated

Certificate of Incorporation and By-Laws

to extend each public director’s term on

the Board from a maximum of four

consecutive years to a maximum of six

consecutive years is consistent with

OCC’s obligations under Section 17A of

the Act. The proposed rule change

should result in OCC’s Board having

greater continuity of leadership and

more meaningful representation. Due to

the increasing complexity of OCC’s

business, continuity of leadership has

become more important to the proper

functioning of OCC. Allowing a public

director’s maximum tenure to extend to

six consecutive years will enhance the

continuity of leadership on OCC’s Board

and still preserve the requirement of fair

representation under the Act.

OCC has 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. The

Commission finds good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice of the filing

because accelerated approval will allow

OCC to implement the new term

structure without disrupting the current

composition of the OCC Board.

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, 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 for inspection and copying in

the Commission’s Public Reference

Section, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such

filing also will be available for

inspection and copying at the principal

office of OCC. All submissions should

refer to File No. SR–OCC–97–03 and

should be submitted by June 22, 1997.

It is therefore ordered, pursuant to

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

proposed rule change (File No. SR–

OCC–97–03) be and hereby is approved

on an accelerated basis.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–8223 Filed 3–31–97; 8:45 am]

BILLING CODE 8010–01–M

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

Statement of Policy on the Rights of

Small Entities in OST Enforcement

Cases

AGENCY: Office of the Secretary (OST),

DOT.

ACTION: Statement of policy on the rights

of small entities in OST enforcement

cases.

SUMMARY: This is the Office of the

Secretary’s statement of policy with

respect to the reduction and waiver of

civil penalties for small entities in OST

enforcement cases.

DATES: This policy is effective on March

29, 1997.

FOR FURTHER INFORMATION CONTACT:

Mark Holmstrup, Office of the General

Counsel, Department of Transportation,

(202) 366–9342, 400 7th Street SW.,

Washington, DC 20590.

SUPPLEMENTARY INFORMATION: Section

223 of the Small Business Regulatory

Enforcement Fairness Act of 1996

(SBREFA) requires agencies to establish

a policy with respect to the reduction

and waiver of civil penalties for small

entities in OST enforcement cases. This

policy statement closely tracks the

requirements of Section 223, and will

apply to the Office of the Secretary’s

(OST) enforcement of (a) the

Department’s aviation economic

requirements contained in 49 U.S.C.

Subtitle VII and 14 CFR Parts 200–399,

as well as the orders, certificates, and

permits issued thereunder; and (b) the

Program Fraud Civil Remedies Act (31

U.S.C. 3801–3812) and the Department’s

implementing regulations (49 CFR Part

31).

The Policy

The following shall apply in assessing

the need for and the amount of any civil