33430 Federal Register / Vol. 63, No. 117 /Thursday, June 18, 1998 / Notices

necessitate procedural changes for Phlx FLEX

trades relating to symbols and Request-for-Quote

processing.

19See Discussion section, supra.

20See supra note 9. 21 15 U.S.C. 78s(b)(2).

22 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3See letter from Linda S. Christie, Counsel, Phlx,

to Yvonne Fraticelli, Attorney, Division of Market

Regulation (‘‘Division’’), Commission (May 22,

1998) (‘‘Amendment No. 1’’). In Amendment No. 1

Phlx replaces the phase ‘‘principal exchange’’ in

Rule 1047 with the phrase ‘‘primary market’’ to

provide consistency with the language in the

proposed amendments to Phlx Rule 1047A and

Option Floor Procedure Advice G–2. Corresponding

with Amendment No. 1, the word ‘‘exchange’’

should be replaced by the word ‘‘market’’ in the

amended portion of Phlx Rule 1047. Telephone

conversation between Linda S. Christie, Counsel,

Phlx, and Marc McKayle, Attorney, Division,

Commission (May 26, 1998).

obtain the benefit of Amex’s advanced

technology and system, certain Phlx

rules will not apply to the trading of

Dell options on Amex,19 the use of Phlx

of Amex systems (such as AOF) that

have already been approved by the

Commission is an appropriate

regulatory alternative under the

circumstances. In light of the exigent

circumstances, the Commission believes

that the proposed solution is an

appropriate measure that provides

adequate regulatory protections.

The Commission also believes that it

is consistent with the Act for Phlx to

deputize Amex floor brokers as Phlx

members, to trade Dell options, to help

ensure sufficient access by the investing

public to Phlx’s satellite facility at

Amex. The Commission notes that it

has, on a prior occasion, authorized

similar deputization to allow for the use

of another exchange facility to trade

options.20 As noted above, the

deputized Amex floor brokers would be

subject to all provisions in Phlx rules

that would apply today to a Phlx

member in the course of his acting as a

floor broker for an order in the Phlx Dell

options on the Phlx trading floor, with

certain minor appropriate exceptions. In

addition, Phlx will have disciplinary

jurisdiction and oversight over

deputized Amex floor brokers relating to

the trading of Dell options on the Amex

floor. Finally, deputized Amex floor

brokers will be required to attend a

training seminar to familiarize them

with Phlx rules and any relevant

distinctions between Phlx rules and

Amex rules before they will be allowed

to execute orders as a floor broker in the

Phlx Dell options.

Phlx’s proposed view that Phlx ByLaw Article XII, Section 12–11, which

disclaims Phlx’s liability to Phlx

members for damages growing out of the

use and enjoyment of Phlx’s facilities, is

applicable to Phlx business conducted

on the Amex floor, is appropriate given

that Phlx is leasing such space and will

be conducting its business through such

facilities. Likewise, it is appropriate for

those Phlx members that are temporarily

re-located to the Amex facility to accept

the same limitations on liability of the

Amex. These Phlx members will utilize

the applicable Amex systems in a nearly

identical fashion to which they would

have relied on Phlx systems prior to the

move. Therefore, this requirement is a

reasonable component of the agreement

to allow Phlx to create a temporary

trading facility on Amex in Dell options.

Phlx essentially concludes that Phlx

Dell options that will be traded on its

temporary Amex facility should not be

considered Amex-traded options for

securities registration purposes and

notes that in October 1989, when

options listed on PCX were physically

moved to Amex and other options

exchanges, due to an earthquake, ‘‘OCC

did not register those options at any

other exchanges.’’ The Commission

believes that the continued trading of

Phlx Dell options by Phlx using leased

space on the floor of Amex does not

cause such options to cease to be option

traded on Phlx and that, accordingly,

OCC does not need to amend its 1934

Act Registration to re-characterize these

options as options listed or traded on

another exchange.

Finally, the Commission notes that, to

minimize investor confusion in the

trading of Dell options, Phlx has stated

that it will provide adequate notice to

its members to ensure that they and the

investing public are aware that Phlx

Dell options are listed, traded and

supervised according to Phlx rules, but

are to be traded at a facility of Phlx

located on the Amex floor. Phlx states

that it has taken steps to advise member

firms of the change in trading venue, so

that they can make necessary system

and order routing changes. These steps

will include notice to members and an

educational session with Phlx of

deputized Amex members who will be

trading Dell options at the new facility.

Phlx is committed to monitoring events

and will take additional steps as

necessary to address specific confusion.

These additional steps could include

issuing press releases or making needed

information otherwise available to

Phlx’s members and to the public.

For the reasons discussed above, the

Commission finds good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice of filing in the

Federal Register. The Commission

believes that it is necessary to approve

Phlx’s proposal on an accelerated basis

to protect the trading interests of the

investing public, due to the exigency of

transferring the trading of Phlx Dell

options from the Phlx trading floor,

which is not currently capable of

managing the high trading volume of

Dell options, to another SRO floor

where the Dell options can be

effectively and efficiently traded.

It is therefore ordered, pursuant to

Section 19(b)(2) 21 of the Act that the

proposed rule change (SR–Phlx–98–25)

is hereby approved on an accelerated

basis through December 12, 1998.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.22

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16258 Filed 6–17–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Released No. 34–40082; File No. SR–Phlx–

98–19]

Self-Regulatory Organization; Notice of

Filing of Proposed Rule Change by the

Philadelphia Stock Exchange, Inc., and

Amendment No. 1 Thereto Relating to

When a Security is Considered Open

For Trading

June 10, 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 May 1,

1998, the Philadelphia Stock Exchange,

Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with

the Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’)

the proposed rule change as described

in Items I, II, and III below, which Items

have been prepared by the Phlx. On

May 22, 1998, the Phlx filed an

amendment to the proposal.3 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 Phlx proposes to amend Phlx

Rules 1047 (Trading Rotations, Halts

and Suspensions), 1047A (Trading

Rotations, Halts or Reopenings), and

Option Floor Procedure Advice G–2

(‘‘Advice G–2’’) (Trading Rotations,

Halts or Reopenings), to clarify when a

security is consider open for trading.

Specifically, and underlying security
Federal Register / Vol. 63, No. 117 /Thursday, June 18, 1998 / Notices 33431

4Telephone conversation between Linda S.

Christie, Counsel, Phlx, and Yvonne Fraticelli,

Attorney and Marc Mckayle, Attorney, Division of

Market Regulation, Commission (May 28, 1998).

5Only quotations disseminated at the opening of

a trading day will be deemed to have opened the

market in an underlying security. Stale quotations

disseminated on a prior trading day will be

ineffective under this proposed rule change.

Telephone conversation between Linda S. Christie,

Counsel, Phlx, and Yvonne Fraticelli, Attorney, and

Marc McKayle, Attorney, Division, Commission

(May 8, 1998).

6 15 U.S.C. 78f.

7 15 U.S.C. 78f(b)(5). 8 17 CFR 200.30–3(a)(12)

shall be considered open for trading

where a transaction has been reported or

an opening indication disseminated,

whichever occurs first, and there has

not been an indication of a delayed

opening given.

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

Phlx 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 Phlx 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

The Phlx proposes amending Phlx

Rules 1047 (Trading Rotations, Halts

and Suspensions), 1047A (Trading

Rotations, Halts or Reopenings), and

Options Floor Procedure Advice G–2

(Trading Rotations, Halts or Reopenings)

to clarify when a security is open. These

provisions govern the various types of

option rotations. Commentary .01(a) of

Rule 1047 pertains to opening rotations,

specifying that the opening rotation in

each class of potions shall be held

promptly following the opening of the

underlying security on the principal

market where it is traded. However,

neither Commentary .01 of Rule 1047,

Rule 1047A, or Advice G–2 delineates

when a security is considered open for

trading. For clarification purposes, the

Phlx proposes amending Rule 1047

Commentary .01(a) to indicate that an

underlying security shall be deemed to

have opened on the primary market

where it is traded it such market has

either (1) reported a transaction in the

underlying security, or (2) disseminated

an opening quotation for the underlying

security and given no indication of a

delayed opening.4 A corresponding

amendment is also proposed for Rule

1047A and Advice G–2. Thus, the

proposal is intended to correct an

ambiguity and expressly provide in

Exchange rules that an opening quote

signals the opening of a security.5 The

proposal should promote more prompt

options openings by not requiring a

transaction to occur in the underlying

security.

The proposed rule change is

consistent with Section 6 of the Act, in

general,6 and Section 6(b)(5),7 in

particular, in that it is designed to

promote just and equitable principles of

trade, prevent fraudulent and

manipulative acts and practices, to

foster cooperation and coordination

with persons engaged in relating, and

facilitating transactions in securities, to

remove impediments to and perfect the

mechanism of a free and open market

and a national market system, as well as

to protect investors and the public

interest. By clarifying the Exchange’s

provisions concerning options openings

and encouraging more prompt openings,

the aim of the Act should be achieved.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Phlx 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 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 Phlx 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 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, 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 Phlx. All submissions

should refer to File No. SR–Phlx–98–19

and should be submitted by July 9,

1998.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.8

Jonathan G. Katz,

Secretary.

[FR Doc. 98–16261 Filed 6–17–98; 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 and request for

comments.

SUMMARY: In compliance with the

Paperwork Reduction Act of 1995 (44

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

announces that the Information

Collection (ICR) abstracted below has

been forwarded to the Office of

Management and Budget (OMB) for

review and comment. 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 March 9, 1998, [63 FR

11472].

DATES: Comments must be submitted on

or before July 20, 1998.

FOR FURTHER INFORMATION CONTACT:

Judith Street, ABC–100; Federal

Aviation Administration; 800

Independence Avenue, SW.;