19994 Federal Register / Vol. 63, No. 77 /Wednesday, April 22, 1998 / Notices

12 In approving this rule, the Commission has

considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

U.S.C. 78c(f).

13See Exchange Act Release Nos. 36657

(December 29, 1995), 61 FR 434 (January 5, 1996)

(accelerated approval extending effectiveness of

hedge exemption pilot program through December

31, 1997); 33783 (March 18, 1994), 59 FR 14229

(March 25, 1994) (accelerated approval extending

effectiveness of hedge exemption pilot program

through December 31, 1995).

14The Commission notes that NASD Regulation

initially requested that the equity option hedge

exemption pilot program be extended until

December 31, 1999. At the Commission’s request,

the proposed rule change was amended to shorten

the requested extension only until December 31,

1998. Given that the equity option hedge exemption

program has been running on a pilot basis for eight

years, the Commission recommends that NASD

Regulation either take steps to adopt the program

on a permanent basis in the near future or eliminate

it.

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

16 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3On April 13, 1998, the PCX submitted a letter,

in response to Commission staff questions,

providing a brief explanation of its proposed

method for admitting employees to participate in

the LMM Program and concerning its proposed

surveillance of the LMM Program employees and

operations. See Letter from Michael D. Pierson,

Senior Attorney, Regulatory Policy, PCX, to Marie

D’Aguanno Ito, Special Counsel, Division of Market

Regulation, Commission, dated April 13, 1998.

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 with respect to the proposed

rule change.

III. Commission’s Findings and Order

Granting Accelerated Approval of the

Proposed Rule Change

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

association and, in particular, with the

requirements of Section 15A(b)(6).

Specifically, the Commission believes

that the proposed extension of the

NASD’s equity option position limit

hedge exemption pilot program will

accommodate the needs of investors and

market participants while at the same

time furthering investor protection and

the public interest.12

The Commission finds good cause to

approve the proposed rule change, as

amended prior to the 30th day after the

date of publication of notice of filing

thereof in the Federal Register.

Specifically, by accelerating the

approval of the NASD’s rule proposal,

the operation of the hedge exemption

pilot program, which as been in place

since 1990, will continue on an

uninterrupted basis until December 31,

1998. The Commission previously

extend the effectiveness of the equity

option hedge exemption pilot program

on an accelerated basis on two prior

occasions.13 The Commission believes

that Amendment No. 1 improves the

proposed rule change by shortening the

extension of the pilot program only

until December 31, 1998, instead of

December 31, 1999. An extension until

December 31, 1998 will give NASD

Regulation sufficient time to consider

the operation of the equity option hedge

exemption program without allowing

the program to drag on for another two

years on a pilot basis.14 The

Commission believes that good cause

exists to accelerate approval of the

proposed rule change, as amended,

because expressly continuing the hedge

exemption pilot program by rule will

reduce the potential for confusion about

the status of such exemption, which

expired on December 31, 1997, and will

promote consistency among the options

markets all of which are a similar

exemption. Accordingly, the

Commission believes that it is

consistent with Section 15A(b)(6) of the

Act to approve the proposed rule change

on an accelerated basis.

IV. Solicitation of Comments

Interested person are invited to

submit written data, views and

arguments concerning the foregoing,

including whether the proposed rule

change is consistent with the Act.

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–NASD–98–02 and should be

submitted by May 13, 1998.

V. Conclusion

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,15 that the

proposed rule change (SR–NASD–98–

02) is approved on a pilot basis until

December 31, 1998.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.16

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–10600 Filed 4–21–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39875; File No. SR–PCX–

98–02]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Pacific Exchange, Inc. Relating to

LMM Book Pilot Program Expansion to

Allow Book Staffing by Employees of

the LMM

April 15, 1998.

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

23, 1998, the Pacific Exchange, Inc.

(‘‘PCX’’ or ‘‘Exchange’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’ or ‘‘SEC’’) 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.3

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

PCX is proposing to expand its Lead

Market Maker (‘‘LMM’’) Book Pilot

Program by allowing qualified LMMs to

manage their own employees in

operating the options public limit order

book under the pilot program.

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.
Federal Register / Vol. 63, No. 77 /Wednesday, April 22, 1998 / Notices 19995

4See Exchange Act Release No. 37810 (October

11, 1996), 61 FR 54481 (October 18, 1996)

(approving File No. SR–PSE–96–09).

5See Exchange Act Release No. 39106 (September

22, 1997), 62 FR 51172 (September 30, 1997).

6See Exchange Act Release No. 37874 (October

28, 1996), 61 FR 56597 (November 1, 1996)

(approving SR–PSE–96–38, establishing a staffing

charge for LMMs who participate in the pilot

program).

7See Exchange Act Release No. 38273 (February

12, 1997), 62 FR 7489 (February 19, 1997).

8See Exchange Act Release No. 38462 (April 1,

1997), 62 FR 16886 (April 8, 1997).

9See Exchange Act Release No. 37874, supra.

10See PCX Rule 6.82(h)(1)(a).

11See PCX Rule 6.53.

12See PCX Rule 6.54.

13See PCX Rule 6.57.

14See PCX Rule 6.82, Commentary .05 (requiring

that LMMs who run the Book to maintain

‘‘minimum net capital,’’ as provided in SEC Rule

15c3–1, and also to maintain a cash or liquid asset

position of at least $500,000, plus $25,000 for each

issue over 5 issues for which they perform the

function of an OBO).

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

16 15 U.S.C. 78f(b)(5).

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

On October 11, 1997, the Commission

approved an Exchange proposal to

adopt a one-year pilot program under

which a limited number of LMMs

would be able to assume operational

responsibility for the options public

limit order book (‘‘Book’’) in certain

option issues.4 On September 22, 1997,

the Commission approved an Exchange

proposal to extend the program for one

year, so that it is currently set to expire

on October 12, 1998.5

Under the pilot program, approved

LMMs manage the Book function, take

responsibility for trading disputes and

errors, set rates for Book execution, and

pay the Exchange a fee for systems and

services.6 Only multiple-listed option

issues are currently eligible to be traded

under the pilot program.7 Initially, the

program was limited by allowing no

more than three LMMs to participate in

the program and no more than 40 option

symbols to be used. But on April 1,

1997, the Commission approved an

Exchange proposal to expand the

program so that up to nine LMMs may

participate and up to 150 option

symbols may be used.8

The Exchange is now proposing to

further expand the program by allowing

LMMs to manage their own employees

in operating the Book. Currently, the

Exchange permits LMMs who are

participating in the pilot program to use

Exchange personnel to assist the LMM

in performing the OBO function, and, in

return, the Exchange charges the LMM

a staffing charge for such use of

Exchange personnel.9 LMMs who

manage their own employees would

continue to set their own rates for Book

executions, but would no longer be

required to pay the Exchange a staffing

charge (except under unusual

circumstances).

Under the pilot program, Exchange

staff currently assist LMMs in

performing Order Book Official (‘‘OBO’’)

functions, pursuant to Rules 6.51

through 6.59.10 These functions include

the OMO’s duty to assist in the

maintenance of a fair, orderly and

competitive market.11 LMMs running

the Book will continue to be required to

report to an Options Floor Official any

unusual activity, transactions or price

changes or other unusual market

conditions or circumstances that are

detrimental to the maintenance of a fair,

orderly and competitive market.12

LMMs who operate the Book will also

continue to be required to disclose to

members, upon request, the price and

number of contracts that are bid below

or that are offered above the Book

information displayed, pursuant to Rule

6.55.13

In the event of unusual market

circumstances, the Exchange will make

Exchange staff available to assist the

LMMs in performing their OBO

functions on a temporary basis, and will

charge such LMMs a reasonable fee for

such services. In this regard, the

Exchange intends to file with the

Commission a proposal to establish

those temporary staffing charges.

The Exchange believes that allowing

LMMs to hire their own employees to

operate the Book will have no negative

impact on the Exchange’s oversight and

regulation of activities on the Options

Trading Floor. LMMs who operate the

Book will continue to be subject to

higher capital requirements than other

LMMs or Market Makers.14 The

Exchange will continue to employ

Exchange staff to monitor the operations

of all LMMs. Exchange staff will also

continue to prepare all Unusual Activity

Reports that are forwarded to the

Surveillance Department for review.

Finally, Floor Officials will continue to

monitor the activities of LMMs,

including those activities that are

brought to the attention of Floor

Officials by members of the trading

crowd, who serve a self-policing

function.

The Exchange believes that the

proposed change will make the

Exchange LMM Program more

competitive because it will provide

LMMs with the same flexibility

currently held by options specialists at

other exchanges, and DPMs at the

Chicago Board Options Exchange.

The Exchange believes the proposed

rule change is consistent with Section

6(b) 15 of the Act, in general, and

furthers the objectives of Section

6(b)(5),16 in particular, in that it is

designed to facilitate transactions in

securities, to promote just and equitable

principles of trade and to 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 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 nor

received.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Within 35 days of the date of

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 such 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,

including whether the proposed change

is consistent with the Act. 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
19996 Federal Register / Vol. 63, No. 77 /Wednesday, April 22, 1998 / Notices

17 17 CFR 200.30–3(a)(12).

available for inspection and copying in

the Commission’s public Reference

Room, 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 PCX. All submissions

should refer to File No. SR–PCX–98–02

and should be submitted by May 13,

1998.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.17

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–10607 Filed 4–21–98; 8:45 am]

BILLING CODE 8010–01–M

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

Reports, Forms and Recordkeeping

Requirements Agency Information

Collection Activity Under OMB Review

AGENCY: Office of the Secretary, DOT.

ACTION: Notice.

SUMMARY: In compliance with the

Paperwork Reduction Act of 1995 (44

U.S.C. 3501 et seq.), this notice

announces that the Information

Collection Request (ICR) abstracted

below has been forwarded to the Office

of Management and Budget (OMB) for

review and approval. The ICR describes

the nature of the information collection

and its expected burden. The Federal

Register Notice with a 60-day comment

period soliciting comments on the

following collection of information was

published on January 30, 1998 [FR 63,

page 4687].

DATES: Comments must be submitted on

or before May 22, 1998.

FOR FURTHER INFORMATION CONTACT:

Barbara Davis, U.S. Coast Guard, Office

of Information Management, telephone

(202) 267–2326.

SUPPLEMENTARY INFORMATION:

United States Coast Guard (USCG)

Title: Boating Statistics Questionnaire.

OMB No.: 2115–0618

Type of Request: Extension of a

currently approved collection.

Affected Public: Recreational Boaters,

Federal and State Officials, Safety

Professional Boating Organizations and

Boating Industry Representatives.

Abstract: The U.S. Coast Guard

publishes a report, Boating Statistics

annually on recreational boating

accidents. The report is distributed to

approximately 7,000 people. The Coast

Guard will conduct a survey to

determine customer’s information needs

and measure their satisfaction with the

Boating Statistics report.

Need: Under 46 U.S.C. 6102(b), the

Coast Guard is authorized to collect,

analyze, and annually publish statistical

information on recreational boating

accidents.

Annual Estimated Burden Hours: 320.

Addresses: Send comments to the

Office of Information and Regulatory

Affairs, Office of Management and

Budget, 725–17th Street, NW.,

Washington, DC 20503, Attention USCG

Desk Officer. Comments are invited on:

The need for the proposed collection of

information for the proper performance

of the functions of the agency, including

whether the information will have

practical utility; the accuracy of the

agency’s estimate of the burden of the

proposed collection of information

including the validity of the

methodology and assumptions used;

ways to enhance the quality, utility, and

clarity of the information to be

collected; and ways to minimize the

burden of the collection of information

on those who are to respond, including

the use of appropriate automated,

electronic, mechanical, or other

technological collection techniques.

Issued in Washington, DC, on April 16,

1998.

Vanester M. Williams,

Clearance Officer, United States Department

of Transportation.

[FR Doc. 98–10732 Filed 4–21–98; 8:45 am]

BILLING CODE 4910–62–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Notice of Agency and Public Scoping

for Cal Black Memorial Airport Glen

Canyon National Recreation Area, Utah

Supplemental Environmental Impact

Statement

AGENCY: Federal Aviation

Administration (FAA), Department of

Transportation.

ACTION: Notice of public and agency

scoping.

SUMMARY: The Northwest Mountain

Region of the Federal Aviation

Administration (FAA) as lead and the

Bureau of Land Management (BLM) and

National Park Service (NPS) as

cooperating agencies announce that the

FAA intends to prepare a Supplemental

Environmental Impact Statement (EIS)

to address issues arising from the 1993

10th Circuit U.S. Court of Appeals

Decision concerning the closure of Halls

Crossing Airport and the development

of Cal Black Memorial Airport. To

ensure that all significant issues related

to the action are identified, additional

scoping comments are requested.

DATE AND ADDRESS FOR COMMENTS:

Scoping was conducted in 1990

concerning the development of this

replacement airport and the transfer of

land from the BLM to San Juan County.

Subsequent to the 1993, 10th Circuit

Court Decision additional scoping was

conducted in 1995 and 1997. Additional

scoping is being conducted prior to

initiating the Draft Supplemental EIS.

The FAA has prepared a scoping

document that is available by contacting

the FAA or by accessing the Internet site

at ‘‘http:/www.airportnetwork.com/

U96’’.

Send comments to, or seek additional

information from, the responsible

Federal official: Mr. Craig Sparks,

Denver Airports District Office, Federal

Aviation Administration, 26805 East

68th Street, Suite 224, Denver, Colorado

80249–6361. To be considered, written

comments must be received on or before

May 18, 1998. Comments may also be

submitted through the project web site,

which may be accessed at: ‘‘http:/

www.airportnetwork.com/U96’’.

SUPPLEMENTARY INFORMATION: Halls

Crossing Airport was located within the

boundary of the Glen Canyon National

Recreation Area, a unit of the NPS. Due

to safety issues with this airport, an EIS

was undertaken concerning the

development of a replacement airport.

In 1990, the FAA issued a Draft and

Final Environmental Impact Statement

for the development of a replacement

Airport, in cooperation with the BLM

and NPS. In August 1990, the FAA

issued a record of decision approving

the development of Cal Black Memorial

Airport and conveying the land from

BLM to San Juan County. In reaching its

approval, the FAA determined that no

significant impacts would result from

the new airport to the recreational

experience of visitors to the recreational

area.

In 1990, the National Parks and

Conservation Association (NPCA), et al

brought suit against the FAA concerning

the adequacy of the EIS and the

adequacy of the BLM Plan Amendment

and land transfer process. In its July 7,

1993, decision, the U.S. Court of

Appeals, 10th Circuit, remanded the EIS

decision back to the FAA for further

environmental analysis of aircraft noise

impacts to the recreational use of public

lands and the BLM’s plan amendment

and transfer of land.