Federal Register / Vol. 66, No. 91 / Thursday, May 10, 2001 / Notices 23961

13 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3 15 U.S.C. 78s(b)(3)(A).

4 17 CFR 240.19b–4(f)(6). The Exchange filed the

pre-filing notice required by Rule 19b–4(f)(6) by

filing a written description of the proposed rule

change and the text of the proposed rule change on

April 3, 2001.

5Securities Exchange Act Release No. 42272

(December 23, 1999), 65 FR 153 (January 3,

2000)(SR–Phlx–99–42). In the approval order, the

Commission requested that the Exchange examine

the operation of the Committee to ensure that the

Committee is not dominated by any one Exchange

interest (e.g., On-Floor or Off-Floor interests). The

Commission requested that the Exchange report

back to the Commission on its views as to whether

the Committee structure ensures that all Exchange

interests are fairly represented by the Committee.

6Securities Exchange Act Release No. 42898

(June 5, 2000), 65 FR 36879 (June 12, 2000)(SR–

Phlx–00–41), extending the pilot program until

August 21, 2000; Securities Exchange Act Release

No. 43169 (August 17, 2000), 65 FR 51888 (August

25, 2000)(SR–Phlx–00–76), extending the pilot

program until November 17, 2000. On July 14, 2000,

the Exchange filed a proposed rule change to effect

the amendments on a permanent basis. SR–Phlx–

00–63 (filed July 14, 2000). In SR–Phlx–00–63 the

Exchange also enclosed the Exchange’s views as to

whether the Committee structure ensures that all

Exchange interests are fairly represented by the

Committee. Because the Exchange is considering

changes to the Committee, the Commission expects

SR–Phlx–00–63 to be withdrawn. In November,

2000, the pilot program was extended again until

April 30, 2001. Securities Exchange Act Release No.

43614 (November 22, 2000), 65 FR 75332

(December 1, 2000).

7See Securities Exchange Act Release No. 38960

(August 22, 1997), 62 FR 45904 (August 29,

1997)(SR–Phlx–97–31).

8See Securities Exchange Act Release No. 26858

(May 22, 1989), 54 FR 23007 (May 30, 1989) (SR–

Phlx–88–36).

9See also Exchange By-Law, Article IV, Section

4–2.

10Previously, the Exchange has described

‘‘extraordinary market or emergency conditions’’ as,

among other things, a declaration of war, a

presidential assassination, an electrical blackout, or

events such as the 1987 market break or other

highly volatile trading conditions that require

intervention for the market’s continued efficient

operation. Letter dated March 15, 1989, from

William W. Uchimoto, General Counsel, Exchange,

to Sharon L. Itkin, Esquire, Commission, Division

of Market Regulation

11 15 U.S.C. 78f.

12 15 U.S.C. 78f(b)(5).

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.13

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–11803 Filed 5–9–01; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–44245; File No. SR–Phlx–

2001–44]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Philadelphia Stock Exchange, Inc.

Extending the Pilot Program for

Exchange Rule 98, Emergency

Committee Until July 31, 2001

May 1, 2001.

Pursuant to Sectiuon19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’)1 and Rule 19b–4 thereunder,2

notice is hereby given that on April 12,

2001, the Philadelphia Stock Exchange,

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

proposed rule change with the

Securities and Exchange Commission

(‘‘SEC’’ or ‘‘Commission’’). The

proposed rule change is described in

Items I, II, and III below, which Items

have been prepared by the Exchange.

The Exchange filed the proposed rule

change pursuant to Section 19(b)(3)(A)

of the Act,3 and Rule 19b–4(f)(6)

thereunder,4 which renders the

proposed rule change effective upon

filing with the Commission. 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 is proposing to extend

the pilot program period for Rule 98,

Emergency Committee until July 31,

2001. No changes to the existing rule

language are being proposed.

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

On December 23, 1999, the

Commission approved amendments to

Rule 98, Emergency Committee (the

‘‘Committee’’), which updated the

composition of the Committee to reflect

the current governance structure of the

Exchange, on a 120-day pilot basis.5 The

pilot has been extended three times,

most recently to April 30, 2001.6 The

pilot program is being extended again to

July 31, 2001 as the Exchange considers

other changes to the composition of the

Committee.

The Exchange originally proposed to

amend Rule 98, Emergency Committee,

by updating the composition of the

Committee to correspond with previous

revisions to the Exchange’s governance

structure,7 and by deleting a provision

authorizing the Committee to take

action regarding CENTRAMART, an

equity order reporting system which is

no longer used on the Exchange Equity

Floor.

The Committee was formed in 1989 8

prior to the aforementioned changes to

the Exchange’s governance structure.

The original proposed rule change,

approved by the Commission, deleted

the word ‘‘President’’ from the rule, as

the Exchange no longer has a

‘‘President,’’ and included the

Exchange’s On-Floor Vice Chairman 9 as

a member of the Committee.

Thus, Rule 98 specifies the

composition of the Emergency

Committee to include the following

individuals: the Chairman of the Board

of Governors; the On-Floor vice

Chairman of the Board of Governors;

and the Chairmen of the Options

Committee, the Floor Procedure

Committee, and the Foreign Currency

Options Committee.

The staff of the Commission has

requested that the Exchange file the

instant proposed rule change to extend

the pilot program through July 31, 2001

so that the Committee will reflect the

current governance structure of the

Exchange and will be in place to take

necessary and appropriate action to

respond to extraordinary market

conditions or other emergencies.10 The

extension of the pilot program will also

allow the Exchange the necessary time

to propose changes to the Committee’s

structure to meet the Commission’s

concerns about whether the Committee

ensures that all interests of the

Exchange (e.g., On-Floor or Off-Floor)

are adequately represented by the

Committee.

2. Statutory Basis

The Exchange believes that the

proposed rule change is consistent with

Section 6 11 of the Act in general, and

with Section 6(b)(5) 12 of the Act in

specific, in that it is designed to perfect

the mechanisms of a free and open

market and a national market system,

and to protect investors and the public

interest, by updating the composition of

the Emergency Committee to reflect the

23962 Federal Register / Vol. 66, No. 91 / Thursday, May 10, 2001 / Notices

13For purposes only of accelerating the operative

date of this proposal, the Commission has

considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

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

14 15 U.S.C. 78s(b)(3)(A).

15 17 CFR 240.19b–4(f)(6).

16 17 CFR 140.19b–4(f)(6).

17 17 CFR 200.30–3(a)(12).

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

2 17 CFR 240.19b–4.

3The Phlx originally submitted the proposed rule

change on April 2, 2001. On April 18, 2001, the

Phlx submitted a new Form 19b–4, which replaces

and supersedes the original filing in its entirety. See

letter from Diana Tenenbaum, Counsel, Phlx, to

Nancy Sanow, Assistant Director, Division of

Market Regulation (‘‘Division’’), Commission, dated

April 17, 2001.

4PACE is the Philadelphia Stock Exchange’s

Automated Communication and Execution System.

It is the Exchange’s order routing, delivery,

execution, and reporting system for its equity

trading floor. See Phlx Rule 229.

current governance structure of the

Exchange, and by continuing to provide

a regular procedure for the Exchange to

take necessary and appropriate action to

respond to extraordinary market

conditions or other emergencies.13

B. Self-Regulatory Organization’s

Statement of Burden on Competition

The Exchange 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.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received from

Members, Participants, or Others

The Exchange has neither solicited

nor received written comments on the

proposed rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

The foregoing rule change has become

effective upon filing pursuant to Section

19(b)(3)(A)(iii) of the Act 14 and Rule

19b–4(f)(4) 15 thereunder because the

proposed rule change does not (i)

significantly affect the protection of

investors or the public interest; (ii)

impose any significant burden on

competition; and (iii) become operative

for 30 days from the date on which the

proposed rule change was filed, or such

shorter time as the Commission may

designate. At any time within 60 days

of the filing of a rule change pursuant

to Section 19(b)(3)(A) of the Act, the

Commission may summarily abrogate

the 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.

The Commission finds that it is

appropriate to accelerate the effective

date of the proposed rule change and to

permit the proposed rule change to

become immediately effective because

the proposal simply extends a

previously approved pilot program until

July 31, 2001. No changes to Rule 98 are

being proposed at this time and the

Commission has not received any

comments on the pilot program. In

addition, the Exchange appropriately

filed a pre-filing notice as required by

Rule 19b–4(f)(6).16

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 20549–0609. 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 Phlx. All

submissions should refer to the File No.

SR–Phlx–2001–44 and should be

submitted by May 31, 2001.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.17

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–11800 Filed 5–9–01; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–44259; File No. SR–Phlx–

2001–41]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of a Proposed Rule Change by the

Philadelphia Stock Exchange, Inc.

Eliminating Equity Trading Floor

Specialist Fees for the Execution of

PACE Orders on the Opening

May 4, 2001.

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 April 18,

2001, the Philadelphia Stock Exchange,

Inc. (‘‘Phlx’’ 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 Phlx.3 The

Commission is publishing this notice to

solicit comments on 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 eliminate equity

trading floor specialist fees for each

PACE transaction for orders entered

before the opening of trading.4

Specifically, the PACE specialist charge

of $.20 per Phlx specialist trade for

PACE executions would be eliminated.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and the

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 the

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The purpose of the proposed rule

change is to alleviate fee burdens on

specialists by eliminating specialist fees

for PACE trades executed by the

specialist on the opening. Presently,

PACE orders, including those executed

on the opening, are charged a PACE

specialist fee of $.20 per trade, in

addition to other costs, such as Stock

Clearing Corporation of Philadelphia

trade processing/clearing fees and

Section 31 fees.

Exchange specialists have many

responsibilities, including the

maintenance of fair and orderly markets.

Phlx specialists provide PACE orders

specific guarantees enumerated in Phlx