22592 Federal Register / Vol. 60, No. 88 / Monday, May 8, 1995 / Notices

1 15 U.S.C. 78s(b)(1) (1988).

2 17 CFR 240.19b–4 (1994).

3Although there is no specific Amex rule

describing the types of orders that AMOS may

accept, it has been the practice of the Exchange to

allow AMOS to accept MOC options orders.

Telephone conservation with Stuart Diamond,

Director, Rulings Department, Amex, and Linda

Tarr, Special Counsel, Amex, and Jennifer Choi,

Attorney, SEC, on May 1, 1995.

4A market-at-the-close order is a market order

that is to be executed at or as near to the close as

practicable. See American Stock Exchange Guide,

Rule 131(e), (CCH) ¶ 9281.

5 15 U.S.C. 78f(b) (1988 & Supp. v. 1993).

6See Securities Exchange Act Release No. 31610

(Dec. 16, 1992), 57 FR 61131 (Dec. 23, 1992) (File

No. SR–Amex–92–34) (permanently approving

procedures to execute MOC orders on every trading

day).

7The closing price is the price at which the MOC

orders were executed. telephone conversation with

Stuart Diamond, Director, Rulings Department,

Amex, and Linda Tarr, Special Counsel, Amex, and

Glen Barrentine and Jennifer Choi, SEC, on March

7, 1995.

8Telephone conversation with Stuart Diamond,

Director, Rulings Department, Amex, and Jennifer

S. Choi, SEC, on April 19, 1995.

9Under the proposed rule change, members may

continue to enter, cancel, or modify MOC orders

manually until 4:00 p.m. MOC orders that are

manually brought to the specialist post by a floor

broker are less likely to delay the specialist’s

processing of the MOC orders because a floor broker

has the discretion not to place a MOC order when

an imbalance of buy and sell MOC orders has

affected the price of a stock. Under the proposed

rule change, a specialist would be able to process

MOC orders entered through the Exchange’s

automated routing system soon after the 3:50

deadline and negotiate with a floor broker when

there is an imbalance between the MOC buy and

sell orders.

10 15 U.S.C. 78s(b)(2) (1988).

11 17 CFR 200.30–3(a)(12) (1994).

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–35660; File No. SR–Amex–

95–09]

Self-Regulatory Organizations;

American Stock Exchange, Inc.; Order

Granting Approval to Proposed Rule

Change Relating to the Entry of

Market-at-the Close Orders

May 2, 1995.

On February 22, 1995, 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 new Commentary .02 to Exchange

Rule 109 to require members entering

market-at-the-close (‘‘MOC’’) orders

through the Exchange’s order routing

systems, Post Execution Reporting

(‘‘PER’’) or Amex Options Switching

(‘‘AMOS’’),3 to do so by no later than

3:50 p.m.

The proposed rule change was

published for comment in Securities

Exchange Act Release No. 35492 (Mar.

15, 1995), 60 FR 14985 (Mar. 21, 1995).

No comments were received on the

proposal.

The Amex Rule 109(d) sets forth the

procedures for executing MOC orders.4

Under Rule 109, a member must execute

MOC orders in a stock where the

member is holding simultaneously both

buy and sell MOC orders in accordance

with certain procedures. Where there is

an imbalance between the buy and sell

MOC orders, a member at the close of

trading must execute the imbalance of

buy orders against the offer and

imbalance of sell orders against the bid.

The member must then stop the

remaining buy and sell orders against

each other and pair them off at the price

of the immediately preceding sale. The

member must report the paired off

transactions to the consolidated last sale

reporting system as ‘‘stopped stock.’’

In situations where there is no

imbalance between the buy and sell

MOC orders, the buy and sell orders are

stopped against each other and paired

off at the price of the last sale on the

Exchange just before the close of trading

in that stock on that day. The

transaction must be reported to the

consolidated reporting system as

stopped stock.

At the present time, members may

enter MOC orders until 4:00 p.m. when

trading closes. Members may enter MOC

orders through the Exchange’s order

routing systems, PER and AMOS, or

manually through a floor broker to the

specialists.

The Exchange proposes to amend

Amex Rule 109 by adopting new

Commentary .02, which would impose

a 3:50 p.m. deadline for the entry,

cancellation, or reduction of all MOC

orders through the PER or AMOS

systems. Thereafter, a member may only

enter, modify, and cancel MOC orders

through other means than the

Exchange’s order routing systems.

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, and, in particular, with the

requirements of Section 6(b) of the Act.5

The Commission believes that the

proposal is consistent with the Section

6(b)(5) requirements that the rules of an

exchange be designed to promote just

and equitable principles of trade, to

prevent fraudulent and manipulative

acts, and, in general, to protect investors

and the public interest.

The Commission has been aware for

several years that the use of compositeasset trading techniques and strategies

has increased substantially, which has

prompted the need to establish greater

price certainty at the close.6 The

Commission believes that the

Exchange’s proposed rule change will

assist specialists in ascertaining the

closing price 7 of a security in a timely

manner by providing specialists with a

reasonable period to assess whether

there is an imbalance of MOC orders,

and to pair off MOC buy and sell orders,

entered through the Exchange’s

automated routing systems. Unlike other

orders, MOC orders do not appear on

the specialist’s electronic book and

specialists must process the orders

manually.8 Therefore, on days where

there is heavy volume of MOC orders,

the execution of MOC orders and, in

turn, the determination of the closing

price, may be delayed under the current

practice. The Commission believes that

the extra time allotted under the

proposal should allow specialists to

effectuate an orderly closing in stocks

by alleviating the problem of MOC

orders being entered through the Amex

automated systems so close to the 4:00

p.m. deadline that the specialists cannot

execute the MOC transactions and

determine the closing price until after

the close.9

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,10 that the

proposed rule change (SR–Amex–95–

09) is approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–11229 Filed 5–5–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–35657; File No. SR–NASD–

95–13]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

National Association of Securities

Dealers, Inc., Relating to Cold Calling

Requirements

May 1, 1995.

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 April 10, 1995, the

National Association of Securities

Dealers, Inc. (‘‘NASD’’ or ‘‘Association’’)

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 NASD. The

Commission is publishing this notice to
Federal Register / Vol. 60, No. 88 / Monday, May 8, 1995 / Notices 22593

1 15 U.S.C. 78o–3. 2 17 CFR 200.30–3(a)(12).

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 NASD is herewith filing a

proposed rule change to Article III,

Section 21 of the Rules of Fair Practice.

Proposed new language is italicized.

Books and Records

Sec. 21.

* * * * *

Cold Call Requirements

(g) Each member shall make and

maintain a centralized do-not-call list of

persons who do not wish to receive

telephone solicitations from such

member or its associated persons.

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

NASD 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 NASD had

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

Pursuant to the Telephone Consumer

Protection Act (TCPA), which became

law in 1991, the Federal

Communications Commission (FCC)

developed rules, effective December 20,

1992, to protect the rights of telephone

consumers while allowing legitimate

telemarketing practices. In addition, the

Telemarketing and Consumer Fraud and

Abuse Prevention Act (‘‘Prevention

Act’’) became law in August, 1994, and

requires the Federal Trade Commission

(FTC) to adopt rules on abusive cold

calling within twelve (12) months.

Members who engage in telephone

solicitation to market their products and

services are subject to the requirements

of the rules of the FCC and FTC relating

to telemarketing practices and the rights

of telephone consumers and shall refer

to FCC rules for specific restrictions on

telephone solicitations. This includes,

but is not limited to, the requirements

to make and maintain a list of persons

who do not want to receive telephone

solicitations (a ‘‘do-not-call’’ list).

The Prevention Act also requires the

SEC to engage in its own additional

rulemaking, or, alternatively, to require

the SROs to promulgate telemarketing

rules consistent with the legislation. In

August of 1994, SEC Chairman Arthur

Levitt wrote to the NASD and NYSE

urging the SROs to adopt a rule similar

to the cold calling rule established by

the FCC. Since then, there have been

ongoing discussions between the SEC

and SROs on the structure of a rule or

rules to apply pursuant to the

Prevention Act. As a first step, the

NASD is proposing to adopt a rule to

implement that portion of the FCC rules

that requires the establishment and

maintenance of a do-not-call list. The

proposed rule would add new

Subsection (g) to Section 21 of Article

III of the Rules of Fair Practice to require

that each member who engages in

telephone solicitation to market its

products and services shall make and

maintain a centralized do-not-call list of

persons who do not wish to receive

telephone solicitations from such

member of its associated persons.

The NASD believes that the proposed

rule change is consistent with the

provisions of Section 15A(b)(6) of the

Act,1 which require that the Association

adopt and amend its rules to promote

just and equitable principles of trade,

and generally provide for the protection

of customers and the public interest in

that the proposed rule change

establishes minimum standards

designed to protect members’ customers

against abusive telemarketing practices.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

The NASD does not believe that the

proposed rule change will result in any

burden on competition that is not

necessary or appropriate in furtherance

of the purposes of the Act, as amended.

(C) Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants, or Others

Written comments 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.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street NW.,

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

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the NASD. All

submissions should refer to file number

SR–NASD–95–13 and should be

submitted by May 30, 1995.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.2

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–11190 Filed 5–5–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–35661; File No. SR–NYSE–

95–05]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

New York Stock Exchange, Inc.,

Relating to Near Neighbor Approach to

Measuring Specialist Performance

May 2, 1995.

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 February 28, 1995,

the New York Stock Exchange, Inc.

(‘‘NYSE’’ 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