8102 Federal Register / Vol. 60, No. 28 / Friday, February 10, 1995 / Notices

1 15 U.S.C. § 78s(b)(1) (1988).

2 17 CFR 240.19b–4 (1993).

3A ‘‘seller’s option’’ trade is defined in Article

XX, Rule 9(c) of the CHX Rules as one for delivery

within the time specified in the option.

4 15 U.S.C. § 78f(b) (1988).

5See, e.g., NYSE Rule 124(B).

6 15 U.S.C. § 78s(b)(2)(1988).

7 17 CFR 200.30–3(a)(12) (1993).

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

policies and practices of the

Government of Canada that are the

subject of this investigation; (ii) the

amount of burden or restriction on U.S.

commerce caused by these acts, policies

and practices; (iii) the determinations

required under section 304 of the Trade

Act; and (iv) appropriate action under

Section 301 which could be taken in

response.

Comments must be filed in

accordance with the requirements set

forth in 15 CFR 2006.8(b) (55 FR 20593)

and are due no later than noon on

March 6, 1995. Comments must be in

English and provided in twenty copies

to: Sybia Harrison, Staff Assistant to the

Section 301 Committee, Room 223,

Office of the United States Trade

Representative, 600 17th Street, NW,

Washington, DC 20506.

Comments will be placed in a file

(Docket 301–98) open to public

inspection pursuant to 15 CFR 2006.13,

except confidential business

information exempt from public

inspection in accordance with 15 CFR

2006.15. Confidential business

information submitted in accordance

with 15 CFR 2006.15 must be clearly

marked ‘‘BUSINESS CONFIDENTIAL’’

in a contrasting color ink at the top of

each page on each of 20 copies, and

must be accompanied by a

nonconfidential summary of the

confidential information. The

nonconfidential summary shall be

placed in the file that is open to public

inspection.

Copies of the public version of the

petition and other relevant documents

are available for public inspection in the

USTR Reading Room. An appointment

to review the docket (Docket No. 301–

98) may be made by contacting Brenda

Webb at (202) 395–6186. The USTR

Reading Room is open to the public

from 10 a.m. to 12 noon and 1 p.m. to

4 p.m., Monday through Friday, and is

located in Room 101, Office of the

United States Trade Representative, 600

17th Street, NW., Washington, DC

20506.

Irving A. Williamson,

Chairman, Section 301 Committee.

[FR Doc. 95–3396 Filed 2–9–95; 8:45 am]

BILLING CODE 3190–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–35335; File No. SR–CHX–

94–23]

Self-Regulatory Organizations;

Chicago Stock Exchange, Inc.; Order

Granting Approval to Proposed Rule

Change Relating to Odd-Lot

Transactions

February 6, 1995.

On November 10, 1994, the Chicago

Stock Exchange, Inc. (‘‘CHX’’ 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

permit differentials to be charged for

certain odd-lot trades..

The proposed rule change was

published for comment in Securities

Exchange Act Release No. 35048

(December 2, 1994), 59 FR 63844

(December 9, 1994). No comment letters

were received.

Currently, Article XXXI, Rule 9

dealing with execution of odd-lot orders

provides that odd-lots must be executed

at the best bid or offer, similar to round

lot executions. The rule does not permit

odd-lot specialists to charge

differentials. The rule change allows the

Committee on Floor Procedure to

determine that a differential may be

charged for: (1) an odd-lot ‘‘seller’s

option’’ trade,3 (2) an odd-lot order for

cash or ‘‘next day’’ delivery, (3) an oddlot order for additional settlement

periods, and (4) an odd-lot order in an

issue in which a differential is charged

in the primary market. If the Committee

on Floor Procedures determines to allow

a differential to be charged under

number 1, 2, or 3 above, all CHX oddlot specialists may charge differentials

under the specified condition. The

Committee on Floor Procedures may

also determine that the primary market

is charging a differential in a particular

security and allow the CHX specialist in

the security also to charge a differential.

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).4 In

particular, the Commission believes 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

remove impediments and to perfect the

mechanism of a free and open market

and a national market system, and in

general, to protect investors and the

public interest.

The Commission believes that the

proposed rule change to allow

differentials to be charged on specified

odd-lot securities will make the rules of

the Exchange consistent with those of

the other securities exchanges.5 In

addition, the rule change will allow the

CHX to authorize the charging of a

differential in a security when the

primary market is charging a differential

in that security. This provision will

ensure that the CHX market makers will

be allowed to effect executions at

competitive prices, which will

contribute to the maintenance of a fair

and orderly market in those securities

trading on the primary market with a

differential.

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,6 that the

proposed rule change (SR–CHX–94–23)

is approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.7

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–3370 Filed 2–9–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–35332; File No. SR–DTC–

95–04]

Self-Regulatory Organizations; The

Depository Trust Company; Notice of

Filing of Proposed Rule Change

Establishing a Link Between the

Institutional Delivery System and Other

Compatible Electronic Trade

Confirmation Systems

February 3, 1995.

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

Securities Exchange Act of 1934

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

January 26, 1995, The Depository Trust

Company (‘‘DTC’’) 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 DTC. The Commission is

publishing this notice to solicit
Federal Register / Vol. 60, No. 28 / Friday, February 10, 1995 / Notices 8103

2The establishment of the link between the ID

system and the Other System would be subject to

the Other Systems obtaining any necessary or

appropriate approvals by regulatory agencies, such

as approval in regard to compliance with Rule 10b–

10 under the Securities Exchange Act of 1934 if the

Other System will confirm transactions.

3Any such fee changes would be filed with the

Commission in accordance with the requirements of

the Securities Exchange Act of 1934.

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 proposed rule change establishes

relationships between The Depository

Trust Company (‘‘DTC’’) and trade

confirmation systems operated by other

organizations that would provide for,

among other things, the automated

settlement in DTC of transactions

introduced to DTC by such other

systems (e.g., confirmed and affirmed in

such other systems). Under this

proposal, DTC would link its

Institutional Delivery (‘‘ID’’) system

with another compatible electronic

trade confirmation system (the ‘‘Other

System’’).2 DTC is prepared at this time

to link the ID system with any Other

System in the manner described below

and estimates that a link in that manner

could be implemented within three

months from the time when the vendor

of the Other System indicates a desire

to establish the link. DTC will consider

and may implement additional methods

of linking the ID system which are

different from the link described below.

Where a broker and its institutional

customer in a trade use the Other

System, and the agent (i.e., the

institution’s custodian) and/or any

interested parties use the ID system,

notice of order execution (sometimes

called advice of execution), institution

instructions (sometimes called trade

allocation), confirmation and

affirmation for the trade will occur in

the Other System, in which case the

Other System will transmit a

confirmation, in DTC format, to the ID

system. DTC will then process the trade

in the ID system, which includes

transmitting an ID system message to

the Other System containing the ID

system control number for the trade and

transmitting confirmations to any agent

and interested parties who use the ID

system. DTC will not transmit

confirmations to the broker and the

institution. The Other System will

transmit to the ID system the affirmation

from the Other System, in DTC format,

containing the ID system control

number. If the trade involves a DTCeligible issue, the trade will be settled

by book-entry at DTC in the normal way

for an affirmed trade in the ID system.

DTC will be responsible for all quality

control reporting with respect to all

trades processed through the link, and

the vendor of the Other System will

furnish DTC with whatever data from

the Other System is needed for that

purpose.

Except as stated in this paragraph,

DTC will charge its usual ID system fees

for a transaction processed through the

link. In the above example, DTC will not

charge confirmation fees to the broker or

institution because it will not send

confirmations to either of them. Fees for

any services provided by the ID system

directly to the broker or institution will

continue to be billed to and paid by the

appropriate party. In order to encourage

the development of links between the ID

system and Other Systems where both

the broker and the institution use the

Other System, the ID system fees

charged in that case to the vendor of the

Other System with respect to

confirmation activity will be limited to

$0.10 per trade during the period ending

on December 31, 1995. DTC continually

examines its fees, and the fees

associated with the link between the ID

system and Other Systems may be

changed after December 31, 1995.3

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 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 such statements.

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

Currently, a large number of DTC

users interact operationally with DTC

through intermediaries selected by

them, including ‘‘service bureaus.’’

Pursuant to standing instructions from

these users, DTC currently links with

these intermediaries in providing a wide

range of DTC services to users,

including the automated delivery and

receipt of ID system confirmations and

affirmations and related reports. In

addition, DTC currently links the ID

system with systems operated by the

other two registered securities

depositories in the United States on a

‘‘private label’’ basis. In those links,

confirmation and affirmation for a trade

occur in the ID system, but any parties

involved in the trade who use the other

depository’s system submit all data and

communications regarding the trade to

the other depository and receive all

such data and communications from the

other depository. On behalf of those

parties, the other depository submits to

and receives from DTC on an omnibus

basis all data and communications

regarding the trade in the course of ID

system processing. DTC is likely to enter

into similar arrangements with other

organizations in the United States and

abroad.

The purpose of the proposed rule

change is to establish a new method of

linking the ID system in addition to the

current arrangements.

DTC believes the proposed rule

change is consistent with the

requirements of the Securities Exchange

Act of 1934 and the rules and

regulations thereunder applicable to

DTC since the proposed rule change

will facilitate the processing of

transactions in securities where

different trade confirmation systems are

involved. 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 since the proposed rule

change relates to DTC’s existing ID

system.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

DTC perceives no adverse impact on

competition by reason of the proposed

rule change.

(C) Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

Written comments from DTC

Participants or others have not been

solicited or received on the proposed

rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Within thirty-five 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

ninety 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:
8104 Federal Register / Vol. 60, No. 28 / Friday, February 10, 1995 / Notices

4 17 CFR 200.30–3(a)(12) (1994).

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

2European-style options can be exercised only

during a specific time period prior to expiration of

the options.

3See Phlx Rules 1000A through 1103A, and 1000

through 1070.

4The formula for calculating the value of the

Index is the same as that previously approved by

the Commission for calculating the value of the

Phlx Big Cap Index. See Securities and Exchange

Act Release No. 33973 (April 28, 1994), 59 FR

23245 (May 5, 1994). Telephone conversation

between Michele Weisbaum, Associate General

Counsel, Phlx, and Brad Ritter, Senior Counsel,

Office of Market Supervision, Division of Market

Regulation, Commission, on February 2, 1995.

(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, 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 in

the Commission’s Public Reference

Room, 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 DTC. All submissions should

refer to File No. SR–DTC–95–04 and

should be submitted within March 3,

1995.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.4

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–3326 Filed 2–9–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–35326; File No. SR–Phlx–

95–07]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Philadelphia Stock Exchange

Relating to the Listing and Trading of

Options on the Phlx USTOP Index

February 3, 1995.

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

Securities Exchange Act of 1934

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

January 30, 1995, 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. 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, pursuant to Rule 19b–4 of

the Act, proposes to list and trade

options on the Phlx USTOP 100 Index,

a broad-based index developed by the

Phlx and comprised of 100 highly

capitalized U.S. stocks representing a

variety of industries (‘‘USTOP 100

Index’’ or ‘‘Index’’). Exchange Rules

1001A, 1006A and 1101A respecting

position limits, exercise restrictions,

trading hours and far term strike prices

respectively will be amended to add

references to the USTOP 100 Index. The

test of the proposed rule changes is

available at the Office of the Secretary,

Phlx, and at the Commission.

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

The Phlx proposes to list for trading

European-style options 2 on the Index, a

broad-based, capitalization-weighted

index composed of 100 highly

capitalized U.S. common stocks in a

variety of industries, including but not

limited to technology, manufacturing

and the service industries. USTOP 100

Index options will be traded pursuant to

current Phlx rules governing the trading

of index options.3

The Phlx represents that the Index

includes some of the largest and most

widely-held U.S. common stocks. As of

January 23, 1995, the Phlx represents

that the market capitalization of the

individual stocks in the Index ranged

from a high of $86 billion to a low of

$7.6 billion. The market capitalization

of all of the stocks in the Index was

approximately $2 trillion. As of that

same date, no one stock accounted for

more than 4.17% of the Index’s total

value and the percentage weighting of

the five largest issues in the Index

accounted for 17.28% of the Index’s

value. The percentage weighting of the

lowest weighted stock was 0.37% of the

Index’s value.

The formula for calculating the value

of the Index is as follows: 4

MV MV MV

Divisor

1 2 100 100 ( ) + ( ) + ( ) ×

L

Where:

MVn=Price × Shares outstanding for

each component of the Index

Divisor=Number calculated to achieve a

base value of 370 for the Index as

of the close of trading on December

14, 1994.

In order to maintain continuity in the

value of the Index, the index divisor

will be adjusted for changes in

capitalization of any of the component

issues resulting from, among other

things, mergers, acquisitions, delistings,

and substitutions. As the close of

trading on January 27, 1995, the Index

Value was 383.81.

The Index value will be updated

dynamically at least once every 15

seconds during the trading day. The

Phlx has retained Bridge Data, Inc. to

compute the value of the Index.

Pursuant to Phlx Rule 1100A, updated

Index values will be disseminated and

displayed by means of primary market

prints reported by the Consolidated

Tape Association and over the facilities

of the Options Price Reporting

Authority. The Index value will also be

available on broker/dealer interrogation

devices to subscribers of the option

information.

In accordance with Phlx Rule 1009A,

if any change in the nature of any stock

in the Index occurs as a result of

delisting, merger, acquisition or

otherwise, the Exchange will take

appropriate steps to delete that stock

from the Index and replace it with

another stock which the Exchange

believes would be compatible with the

intended market character of the Index.

In making replacement determinations,

the Exchange will also take into account