Federal Register / Vol. 62, No. 9 / Tuesday, January 14, 1997 / Notices 1937

4As proposed, these policies and procedures will

not be subject to pre-approval by the Exchange.

Telephone conversation between Bill Floyd-Jones,

Assistant General Counsel, AMEX, and Heather

Seidel, Attorney, Division of Market Regulation,

Commission, on January 2, 1997.

5See Broker-Dealer Policies and Procedures

Designed to Segment the Flow and Prevent the

Misuse of Material Nonpublic Information,

Securities and Exchange Commission Division of

Market Regulation, March 1990.

6 15 U.S.C. 78f(b)(5) 7 17 CFR 200.30–3(a)(12). 1 15 U.S.C. § 78s(b)(1).

prophylactic restrictions on trading

represented by Rule 950(n) are not

essential to ensure compliance with

standards of fair dealing.

For the foregoing reasons, the

Exchange believes that it is appropriate

to permit Exchange specialist

organizations and their affiliates to

engage in market making in specialty

options on the floor of other options

exchanges. This measure will eliminate

a regulatory disparity between the rules

of the Exchange and other markets. To

ensure that specialist organizations and

their affiliates do not intentionally trade

ahead of, or otherwise disadvantage,

orders on the AMEX limit order book,

the Exchange will require any AMEX

member organization that seeks to act as

a market maker on the floor of another

options exchange in an option in which

they are a specialist on the AMEX to

implement policies and procedures

designed to prevent the misuse of

information regarding limit orders on

the AMEX limit order book.4 These

policies and procedures will not have to

conform to the specific requirements of

Rule 193. Instead, the Exchange

proposes to adopt the approach used by

Congress in enacting Sections 15(f) and

21A of the Act, and by the Commission

in adopting Rule 14(e)(3) under the Act,

which require firms to adopt

information barriers, but do not legislate

the design of these internal controls.5

The Exchange believes that specialist

firms and their affiliates should have the

ability (subject to Exchange oversight) to

structure information barriers that are

appropriate to the structure of their

firms.

2. Statutory Basis

The proposed rule change is

consistent with Section 6(b) of the Act

in general and furthers the objectives of

Section 6(b)(5) 6 in particular in that it

is designed to prevent fraudulent and

manipulative acts and practices,

promote just and equitable principles of

trade, remove impediments to and

perfect the mechanism of a free and

open market and a national market

system, and, in general, protect

investors and the public interest.

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 the

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 sand 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 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–AMEX–96–46 and should be

submitted by January 27, 1997.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.7

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–862 Filed 1–13–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38125; File No. SR–CHX–

96–32]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change Relating to

a Fee Waiver by the Chicago Stock

Exchange, Incorporated

January 6, 1997.

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

Securities Exchange Act of 1934 (the

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

December 17, 1996, the Chicago Stock

Exchange, Incorporated (‘‘CHX’’ 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 self-regulatory

organization. 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 Exchange proposes to waive

certain member charges in its

Membership Dues and Fees Schedule.

Specifically, the Exchange proposes to

waive all membership dues for the

month of December. The Exchange also

proposes to waive all floor telephone

booth and post space charges for the

fourth quarter of 1996 (i.e., October,

November and December).

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.
1938 Federal Register / Vol. 62, No. 9 / Tuesday, January 14, 1997 / Notices

2 15 U.S.C. § 78f(b)(4).

3 15 U.S.C. § 78s(b)(3)(A).

4 17 CFR 19b–4(e).

5 17 CFR 200.30–3(a)(12).

1See Securities Exchange Act Release Nos. 26218

(October 26, 1988), 53 FR 44137 (November 1,

1988); 27370 (October 23, 1989), 54 FR 43881

(October 27, 1989); 28580 (October 25, 1990), 55 FR

45895 (October 31, 1990); 29868 (October 28, 1991),

56 FR 56535 (November 5, 1991); 33120 (October

29, 1993), 58 FR 59503 (November 9, 1993); 36414

(October 25, 1995), 60 FR 55630 (November 1,

1995); and 37459 (July 19, 1996), 61 FR 39172 (July

26, 1996).

2 ‘‘Dow Jones Industrial Average’’ is a service

mark of Dow Jones & Company, Inc.

3See Securities Exchange Act Release No. 26218

(October 26, 1988), 53 FR 44137 (November 1,

1988).

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The purpose of the proposed rule

change is to waive membership dues for

the month of December, 1996, and

waive floor telephone booth and post

space charges for the fourth quarter of

1996 because the Exchange has already

adequately covered its costs associated

with these services for the year.

2. Statutory Basis

The proposed rule change is

consistent with Section 6(b)(4) of the

Act 2 in that it provides for the equitable

allocation of reasonable dues, fees and

other charges among its members and

issuers and persons using its facilities.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange does not believe that

the proposed rule change will impose a

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.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The foregoing rule change establishes

or changes a due, fee, or other charge

imposed by the Exchange and therefore

has become effective pursuant to

Section 19(b)(3)(A) of the Act 3 and

subparagraph (e) of Rule 19b–4 4

thereunder. At any time within 60 days

of the filing of such 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 submission

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 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, N.W.,

Washington, D.C. Copies of such filing

also will be available for inspection and

coping at the Exchange. All submissions

should refer to File No. SR–CHX–96–32

and should be submitted by January 27,

1997.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.5

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–808 Filed 1–13–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38130; File No. SR–CHX–

96–33]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Chicago Stock Exchange,

Incorporated Relating to the Circuit

Breaker Pilot Program

January 6, 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 December 18, 1996,

the Chicago Stock Exchange,

Incorporated (‘‘CHX’’ 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 CHX. 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 CHX proposes to amend Article

IX, Rule 10A ‘‘Trading Halt Due to

Extraordinary Market Volatility’’

(‘‘circuit breakers’’) 1 to increase the

levels at which such circuit breakers are

triggered. The Exchange seeks to effect

these changes on a one-year pilot basis.

The text of the proposed rule change

is available at the Office of the

Secretary, the CHX, 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

Statutory Basis for, the Proposed Rule

Change

1. Purpose

Article IX, Rule 10A (Trading Halts

Due to Extraordinary Market Volatility)

is the Exchange’s codification of the

several recommendations for circuit

breakers which were made in the wake

of the market break of 1987. The current

rule, which is due to expire on October

31, 1997, provides that if the Dow Jones

Industrial Average 2 (‘‘DJIA’’) falls 250

or more points below its previous

trading day’s closing value, trading in

all stocks on the Exchange shall halt for

one-half hour. The Rule further provides

for a one hour trading halt if the decline

in the DJIA is 400 or more points.

Although the Rule was amended in July

1996 to shorten the time periods for

marketwide trading halts, the levels of

the circuit breakers themselves have not

been adjusted since the Rule was first

adopted. The Exchange believes that it

is appropriate to amend Article IX, Rule

10A to raise the circuit breakers from

250 points to 350 points and from 400

points to 550 points.

Article IX, Rule 10A was approved by

the Commission in October 1988 as a

one-year pilot3 and has been extended

on a pilot basis since then. At that time,

the DJIA was at a level of about 2100

points. A 250 point drop would have

represented at 12% decline in the

average. A 400 point drop would have