31726 Federal Register / Vol. 66, No. 113 / Tuesday, June 12, 2001 / Notices

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

2 17 CFR 240.19b-4.

3See Securities Exchange Act Release No. 43537

(November 9, 2000), 65 FR 69977. 4The substance of Amendment Nos. 1 and 2 is

discussed below. 5 In approving this proposed rule change, the

Commission notes that it has considered the

proposed rule’s impact on efficiency, competition,

and capital formation. 15 U.S.C. 78c(f).

6 15 U.S.C. 78f.

7 15 U.S.C. 78f(b)(5).

8See Securities Exchange Act Release No. 42835

(May 26, 2000), 65 FR 35683 (June 5, 2000).

investing in the Fund may conflict; and

(c) the Board will monitor events in

order to identify the existence of any

material conflicts of interest and to

determine what action, if any, should be

taken in response to any such conflict.

10. Each Fund will comply with all

the provisions of the Act requiring

voting by shareholders (which, for these

purposes, shall be the persons having a

voting interest in the shares of the

Funds) and in particular, each such

Fund will either provide for annual

meetings (except to the extent that the

SEC may interpret Section 16 of the Act

not to require such meetings) or comply

with Section 16(c) of the Act (although

the Funds are not within the trusts

described in Section 16(c) of the Act) as

well as Section 16(a) and, if applicable,

Section 16(b) of the Act. Further, each

Fund will act in accordance with the

SEC’s interpretation of the requirements

of Section 16(a) with respect to periodic

elections of directors (or trustees) and

with whatever rules the SEC may

promulgate with respect thereto.

11. If and to the extent that Rules 6e–

2 and 6e–3(T) are amended (or if Rule

6e–3 under the Act is adopted) to

provide exemptive relief from any

provisions of the Act or the rules

promulgated thereunder with respect to

mixed and shared funding on terms and

conditions materially different from any

exemptions granted in the order

requested by Applicants, then the

Funds, the Participating Insurance

Companies and Participating Plans, as

appropriate, shall take such steps as

may be necessary to comply with Rules

6e–2 and 6e–3(T), as amended, and Rule

6e–3, as adopted, to the extent

applicable.

12. No less than annually, the

Manager, Advisers (or any other

investment adviser of a Fund), the

Participating Insurance Companies and

Participating Plans shall submit to the

Boards such reports, materials, or data

as such Boards may reasonably request

so that the Boards may carry out fully

the obligations imposed upon them by

the conditions contained in the

application. Such reports, materials and

data shall be submitted more frequently

if deemed appropriate by the applicable

Boards. The obligations of the Manager,

Advisers (or any other investment

adviser for a Fund), Participating

Insurance Companies and Participating

Plans to provide these reports, materials

and data to the Boards shall be a

contractual obligation of the Manager,

Advisers (or any other investment

adviser of a Fund), Participating

Insurance Companies and Participating

Plans under the agreements governing

their participation in the Funds.

13. If a Plan or Plan participant

shareholder should become an owner of

10% or more of the issued and

outstanding shares of a Fund, such Plan

will execute a participation agreement

with such Fund including the

conditions set forth herein to the extent

applicable. A Plan or Plan participant

shareholder will execute an application

containing an acknowledgment of this

condition at the time of its initial

purchase of shares of the Fund.

Conclusion

For the reasons summarized above,

Applicants represent that the

exemptions requested are necessary and

appropriate in the public interest and

consistent with the protection of

investors and purposes fairly intended

by the policy and provisions of the 1940

Act.

For the Commission, by the Division of

Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–14675 Filed 6–11–01; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–44394; File No. SR–CBOE–

00–43]

Self-Regulatory Organizations;

Chicago Board Options Exchange,

Inc.; Order Granting Approval and

Notice of Filing and Order Granting

Accelerated Approval to Amendment

Nos. 1 and 2 to Proposed Rule Change

Relating to Participation Rights in

Crossing Transactions

June 6, 2001.

I. Introduction

On august 29, 2000, the Chicago

Board Options Exchange, Inc.(‘‘CBOE’’)

filed with the Securities and Exchange

Commission (‘‘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 amend CBOE Rule 6.74(d),

which currently entitles a floor broker

representing a member firm to cross a

certain percentage of each customer

order the firm sends to the floor against

another order on behalf of the same

firm.

The proposed rule change would: (a)

Make clear that Rule 6.74(d) includes

the situation where a floor broker is

seeking to cross a solicited order against

the original customer order; and (b)

expand Rule 6.74(d) to allow the floor

broker representing the original

customer order to solicit the order to

trade against it even if that floor broker

is not a nominee of the originating firm.

The proposed rule change was

published for comment in the Federal

Register on November 21, 2000.3 The

Commission received no comments on

the proposal. The CBOE filed

Amendment Nos. 1 and 2 to the

proposed rule change with the

Commission on February 12, 2001, and

May 23, 2001, respectively.4 This order

approves the proposed rule change,

accelerates approval of Amendment

Nos. 1 and 2, and solicits comments

from interested persons on those

amendments.

II. Discussion

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 5 and, in particular, the

requirements of section 6 of the Act 6

and the rules and regulations

thereunder. The Commission finds

specifically that the proposed rule

change, as amended, is consistent with

section 6(b)(5) of the Act 7 because it

establishes the ability of firms and floor

brokers to solicit orders to supply the

contra side for customer orders in a

manner that matches or improves the

price available from the crowd while

conforming to the principles and

limitations set forth by the Commission

in its original approval of Rule 6.74(d)

concerning participation rights in

crossing transactions.8

Amendment No. 1 to the proposed

rule change would add Interpretation

.07 to Rule 6.74 to make clear that a

floor broker may not cross an order that

he is holding with an order from a

market maker that is then in the trading

crowd. Amendment No. 2 would clarify

that the proposed change to CBOE Rule

6.74 is intended to supersede the

provisions of paragraph (d) of CBOE

Rule 6.9, ‘‘Solicited Transactions,’’

when the conditions specified in CBOE

Rule 6.74 are met. The Commission

finds that Amendment Nos. 1 and 2 are

Federal Register / Vol. 66, No. 113 / Tuesday, June 12, 2001 / Notices 31727

9 15 U.S.C. 78s(b)(2).

10 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1).

2Nasdaq Europe plans to issue a compliance

notice requiring its members to ensure that

settlement at DTC of Nasdaq Europe trades are done

in accordance with the procedures prescribed by

DTC.

appropriate clarifications of the

proposed rule change and are consistent

with section 6(b)(5) of the Act. In

addition, because these amendments

clarify the intent of the proposed rule

change and thereby strengthen the

proposal, the Commission finds good

cause for approving their provisions

prior to the thirtieth day after the date

of publication of notice of filing thereof

in the Federal Register.

III. Solicitation of Comment

Interested persons are invited to

submit written data, views, and

arguments concerning Amendment Nos.

1 and 2, including whether these

amendments are 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 CBOE. All

submissions should refer to File No.

SR–CBOE–00–43 and should be

submitted by July 3, 2001.

IV. Conclusion

For the reasons discussed above, the

Commission finds that the proposal, as

amended, is consistent with the Act and

the rules and regulations thereunder.

It Is Therefore Ordered, pursuant to

section 19(b)(2) of the Act,9 that the

proposed rule change (File No. SR–

CBOE–00–43), as amended, be, and

hereby it is, approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.10

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–14737 Filed 6–11–01; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–44393; File No. SR–DTC–

2001–08]

Self-Regulatory Organizations; Notice

of Filing and Order Granting

Accelerated Approval of Proposed

Rule Change by The Depository Trust

Company Relating to DTC Settling

Trades Executed on Nasdaq Europe

June 6, 2001.

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

Securities Exchange Act of 1934

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

May 25, 2001, The Depository Trust

Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change as described in Items I and II

below, which items have been prepared

primarily by DTC. The Commission is

publishing this notice and order to

solicit comments on the proposed rule

change from interested parties and to

grant accelerated approval of the

proposed rule change.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The proposed rule change provides

that participants who settle trades

executed on Nasdaq Europe through

book-entry deliveries at DTC (i) are

required to effect the settlement of such

trades in the manner prescribed by DTC

so that such trades can be separately

identified and (ii) authorize DTC to

provide to Nasdaq Europe information

relating to the settlement of such trades.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

DTC 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. DTC has prepared

summaries, set forth in sections (A), (B),

and (C) below, of the most significant

aspects of these statements.

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

It is expected that on or about June 8,

2001, Nasdaq Europe, an exchange

established under Belgian law, will

begin listing securities on its European

Trading System. In order to facilitate the

settlement of these securities, Nasdaq

Europe plans to approve DTC as a

settlement location for Nasdaq Europe

trades in DTC-eligible securities. To

allow Nasdaq Europe to designate DTC

as an approved settlement location

under Belgian law, DTC must agree to

provide Nasdaq Europe upon request

with information that DTC has

pertaining to the settlement of Nasdaq

Europe trades at DTC. In order for DTC

to be able to provide this information,

DTC must require its participants (1) to

effect the settlement of such

transactions in a manner that separately

identifies them from the participants’

other settlement activities 2 and (2) to

authorize DTC to provide information

related to such trades to Nasdaq Europe.

Under the proposed rule change, DTC

will require that the settlement of

Nasdaq Europe trades be effected in a

separate subaccount that will be

established by the participant solely for

the settlement of Nasdaq Europe trades.

If it is determined that a more

automated solution should be

developed in the future, DTC will make

the necessary systems changes to allow

participants to designate settlement

activity relating to Nasdaq Europe trades

by entering a special activity code in

their deliver order instructions. If such

systems changes are made, participants

will be required to use the activity code

to identify Nasdaq Europe trades.

Participants will be kept informed by

Important Notices if DTC determines

that it will further automate the

identification of settlement activity

related to Nasdaq Europe trades.

The proposed rule change is

consistent with the requirements of

section 17A of the Act and the rules and

regulations thereunder because the

proposed rule change will increase

operational efficiencies for participants

by allowing for the settlement at DTC of

Nasdaq Europe trades in DTC-eligible

securities. The proposed rule change

will be implemented consistently with

the safeguarding of securities and funds

in DTC’s custody or control or for which

it is responsible because all of DTC’s

risk management controls will continue

in effect.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

DTC perceives no impact on

competition by reason of the proposed

rule change.