62912 Federal Register / Vol. 60, No. 235 / Thursday, December 7, 1995 / Notices

inappropriate to apply the stabilization

requirements applicable to REMMs to market maker

transactions in currency warrants.

4 17 CFR 200.30–3(a)(12) (1994).

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

2 17 CFR 240.19b–4 (1991).

3The Commission also received a separate, yet

identical proposed rule change relating to member

subscriber deposits for Nasdaq Level 2/3 service

and equipment which became effective upon

receipt by the Commission pursuant to Section

19(b)(3)(A) of the Act and subparagraph (e) of Rule

19b–4 thereunder because it established or changed

a due, fee or other charge imposed by the NASD on

its members. Securities Exchange Act Release No.

36396 (October 20, 1995), 60 FR 54896.

4Securities Exchange Act Release No. 36397

(October 20, 1995), 60 FR 54897.

5See supra note 3.

6Section 15A(b)(5) requires the Commission to

determine that a registered national securities

association’s rules provide for the equitable

allocation of reasonable dues, fees, and other

charges among members and issuers and other

persons using any facility or system which the

association operates or controls.

market makers are designated as

Specialists on the Exchange for all

purposes under the Act (See Rule 958,

Commentary .01), and are entitled to

good faith market maker margin with

respect to transactions on the Floor in

these assigned securities. The Exchange

anticipates that application of Rule 958

requirements to supplemental Exchange

market makers will encourage

additional competing market maker

activity in currency warrants, thereby

enhancing liquidity in such securities,

and eliminate an anomalous regulatory

disparity between currency warrant and

stock index warrant trading.

2. Statutory Basis

The Exchange believes the proposed

rule change is consistent with Section

6(b) of the Act in general and furthers

the objectives of Section 6(b)(5) in

particular in that it is designed to

prevent fraudulent and manipulative

acts and practices and to promote just

and equitable principles of trade, and is

not designed to permit unfair

discrimination between customers,

issuers, brokers and dealers.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange believes the proposed

rule change will impose no burden on

competition.

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

Within 35 days of the publication of

this notice in the Federal Register or

within such other period (i) as the

Commission may designate up to 90

days of such date if it finds such longer

period to be appropriate and publishers

its reasons for so finding or (ii) as to

which the self-regulatory organization

consents, the Commission will:

(A) By order approve the 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, 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

Section, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of the Amex. All submissions

should refer to File No. SR-Amex-95–38

and should be submitted by December

28, 1995.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.4

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–29777 Filed 12–6–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–36536; File No. SR–NASD–

95–48]

Self-Regulatory Organizations; Order

Approving Proposed Rule Change by

National Association of Securities

Dealers, Inc. Relating to Non-Member

Subscriber Deposits for Nasdaq Level

2/3 Service and Equipment

November 30, 1995.

I. Introduction

On October 11, 1995, the National

Association of Securities Dealers, Inc.

(‘‘NASD’’ or ‘‘Association’’) 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 revise the nonmember subscriber deposit

requirements contained in Part VIII,

Paragraph G.1. and 2. of Schedule D to

the NASD By-Laws.3 The proposed rule

change reflects increased charges for the

provision of telecommunications

services and equipment and broadens

the language to encompass the various

fees associated with these services and

equipment.

Notice of the proposed rule change

appeared in the Federal Register on

October 26, 1995.4 No comment letters

were received on the proposal. The

Commission is approving the proposed

rule change.

II. Description of Proposal

The proposed rule change reflects

increased charges for the provision of

telecommunications services underlying

Nasdaq Workstation II service, and

clarifies the various component

functions encompassed within the

circuit installation fee so that the true

nature of the charge is made clear to

new subscribers. These requirements

would pertain only to new subscribers

or existing subscribers that have

defaulted on the payment of their

charges.

This proposed rule change applies to

subscribers who are not NASD

members. A companion filing, which

applies the proposed rule change to

member subscribers, was filed

separately for immediate effectiveness.5

The NASD represents that the

subscriber deposit requirement helps

hedge against uncollected balances

owed by firms for Level 2/3 or Nasdaq

Workstation equipment. The subscriber

deposit in part represents actual

expenses incurred by The Nasdaq Stock

Market, Inc. as obligations to

telecommunications providers.

III. Discussion

The Commission believes that the

proposed rule change is consistent with

the Act and the rules and regulations

promulgated thereunder. Specifically,

the Commission believes that approval

of the proposed rule change is

consistent with sections 15A(b)(5),6
Federal Register / Vol. 60, No. 235 / Thursday, December 7, 1995 / Notices 62913

7Section 15A(b)(6) requires the Commission to

determine that a registered national securities

association’s rules are designed to promote just and

equitable principles of trade, to remove

impediments to and perfect the mechanism of a free

and open market and a national market system; and

are not designed to permit unfair discrimination

between customers, issuers, brokers, or dealers, to

impose any schedule or fix rates of commissions,

allowances, discounts, or other fees to be charged

by its members, or to regulate by virtue of any

authority conferred by the Act matters not related

to the purposes of the Act or the administration of

the NASD.

8Section 15A(b)(9) requires the Commission to

determine that a registered national securities

association’s rules do not impose any burden on

competition not necessary or appropriate in

furtherance of the purposes of the Act.

9 15 U.S.C. 78s(b)(2) (1988).

10 17 CFR 200.30–3(a)(12).

1This policy is set forth in Regulatory Circular RG

93–50, which is a reissuance of RG 91–68,

submitted for immediate effectiveness as File No.

SR–CBOE–91–48, noticed in Securities Exchange

Act Release No. 30334 (February 4, 1992), 57 FR

4900 (February 10, 1992).

2See Regulatory Circular RG 95–64, which is a

reissuance of Regulatory Circular RG 91–57,

approved in Securities Exchange Act Release No.

31174 (September 10, 1992), 57 FR 42789

(September 16, 1992).

15A(b)(6),7 and 15A(b)(9) 8 of the Act.

Pursuant to sections 15A (b)(5) and

(b)(6), the proposed rule change

equitably allocates the fees between

NASD members and non-NASD

members. Because both members and

non-members are subject to the same fee

schedules and arrangements, there is no

unfair discrimination between member

and non-member subscribers. Pursuant

to section 15A(b)(9), the proposed rule

change does not impose any

unnecessary or inappropriate burden on

competition, but reflects an attempt to

update a rule that contains provisions

that are no longer applicable because

they do not adequately represent current

market practices or pricing. In light of

the technological advancements in the

telecommunications area, increased

costs are commensurate with providing

current and potential subscribers with

access to the various communications

services and equipment. However, the

schedule of NASD charges for services

and equipment is based on a per unit

cost; therefore, members and nonmembers are subject to the same

charges. Thus, the revision in subscriber

deposit requirements does not impose

any unnecessary or inappropriate

burdens on competition.

IV. Conclusion

For the above reasons, the

Commission believes that the proposed

rule change is consistent with the

provisions of the Act, and in particular

with sections 15A(b)(5), 15A(b)(6), and

15A(b)(9).

It is therefore ordered, pursuant to

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

proposed rule change (SR–NASD–95–

48) be, and hereby is approved.

For the Commission, by the Division

of Market Regulation, pursuant to

delegated authority.10

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–29778 Filed 12–06–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–36534; File No. SR–CBOE–

95–65]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Chicago Board Options Exchange,

Inc. Relating to Joint Account

Participant Trading in Equity Options

November 30, 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 October 20, 1995,

the Chicago Board Options Exchange,

Inc. (‘‘CBOE’’ 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 selfregulatory organization. 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 proposes to revise its

policy regarding joint account

participation in equity options. The text

of the proposed rule change is available

at the Office of the Secretary, CBOE and

at the Commission.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

CBOE 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 CBOE 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 purpose of this rule change is to

revise that provision of the Exchange’s

policy governing joint account

participant trading in equity options

that currently prohibits the

simultaneous representation in a trading

crowd by more than one member of a

joint account.1 Under the proposed

regulatory circular, a joint account may

be simultaneously represented in a

trading crowd but only by participants

trading in-person. All other provisions

of the current regulatory circular would

remain unchanged, including a

prohibition against orders being entered

in the crowd via a floor broker when a

joint account participant is trading in

the crowd in-person. This change in

policy is also reflected in a deletion of

one sentence and the addition of

another from paragraph (a)(ii) of Rule

8.16, RAES Eligibility in Equity

Options.

There are two reasons why the

Exchange has determined to propose

this change, which has been

recommended by the Exchange’s Equity

Floor Procedure Committee. First, the

change will make the policy governing

joint account trading in equity options

more consistent with the current policy

governing index option trading, where

multiple representation of orders for the

same joint account is permitted by

participants in the joint account trading

in-person at the trading post, or by floor

brokers representing the orders at the

post.2 The policy proposed for equity

options is more restrictive, in that it

would only permit joint representation

by participants trading in-person, and

would not permit multiple

representation of orders for the same

joint account if one or more of the

orders is represented by a floor broker.

The policy for index options reflects

that, as a practical matter, floor broker

representation is often required in index

option trading crowds, where special

trading practices and procedures have

been adopted to deal with the special

needs of these very large crowds. Since

a trader from another crowd may be

unfamiliar with these practices, he may

need to use the services of a floor broker

who is regularly present at the index

crowd and who understands its trading

practices. Smaller equity option trading

posts do not present the same practical

need for the services of floor brokers,

which is why the proposed policy

permitting joint account representation

at equity option posts is limited to inperson representation of orders by

market-makers.