[Federal Register Volume 61, Number 203 (Friday, October 18, 1996)]
[Notices]
[Pages 54479-54480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-26714]
[[Page 54479]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37799; File No. SR-PSE-96-30]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Pacific Stock Exchange Incorporated Relating to the Use
of Member Badges on, and the Admission of Visitors to, the Equity
Floors of the Exchange
October 9, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') and Rule 19b-4 thereunder, notice is hereby given that on
August 22, 1996, the Pacific Stock Exchange Incorporated (``PSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'' or ``SEC'') 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
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 Pacific Stock Exchange Incorporated (``PSE'' or ``Exchange'')
is proposing to amend its Equity Floor Procedure Advice (``EFPA'') 1-C
relating to the use of Member badges on, and the admission of visitors
to, the Equity Floors of the Exchange. The text of the proposed rule
change is stated below, new text is italicized, deletions are in
brackets:
* * * * *
EQUITY FLOOR PROCEDURE ADVICES
* * * * *
1-C
para. 7610 Badges and Visitors on the [Equity] Equities Trading Floors
(i) Admission of Members
The security of individuals and proprietary trading information on
the Equities Trading Floors requires the following provisions be
adopted with respect to admission on the Trading Floor:
(a) [1] Admission to the Equities Trading Floors shall be by badge
only.
(b) [2] Members working on the Equities Trading Floors who seek
admission to a Floor without a badge must identify themselves at the
reception desk and obtain a temporary badge.
(c) [3] Exchange employees working on the Trading Floor who seek
admission to the Floor without a badge must be identified by the
appropriate Equities Floor Manager, and issued a temporary badge.
(d) [4] Member Firm employees working on the Trading Floor seeking
admission to the Floor without a badge must be identified by a Member
with a badge, and issued a temporary badge.
(e) [5] Repeated failure of Members or Member Firm personnel to
have a permanent badge on admission to the Trading Floor may subject
the Member or Member Firm to the following fines: [a fine.]
1st Offense [$10.00] $25.00
2nd Offense [$25.00] $50.00
3rd Offense [$50.00] $100.00
(ii) Badge Transfers
(a) A Member may transfer his or her membership privileges to
another person of the same Member Firm for one or more days, provided
that the Member must first obtain the approval of the Exchange. A
Member who allows another person to use that Member's badge for one
full day or longer and who fails to obtain Exchange approval for such
transfer will be subject to the following fines:
1st Offense $100.00
2nd Offense $250.00
3rd Offense $500.00
(iii) Admission of Visitors
(a) [6] Visitors must be the invited guests of Exchange Members or
Exchange Officials. Visitors must be signed in at the reception desk by
the inviting Member or staff personnel. Visitors will be issued a
temporary badge to wear at all times while on the Floor. Visitors shall
be accompanied at all times on the Floor.
(b) [7] Allied Members shall be considered visitors for the
purposes of this Advice.
(c) [8] The Floor Trading Committee Members of each respective
trading floor may restrict the access of any visitor to the Floor when
the Committee Members deem that the visitor's presence interferes with
orderly Floor procedures.
A Member who is responsible for a violation of these provisions on
the admission of visitors will be subject to the following fines:
1st Offense $25.00
2nd Offense $50.00
3rd Offense $100.00
Violations of this Advice 1-C shall be cumulative and the number of
offenses for a violation of Equity Floor Procedure Advice 1-C shall be
calculated on a twelve-month rotating basis. Therefore, a violation in
January would be removed from the calculation in January of the
following year.
* * * * *
para.6133 Minor Rule Plan
Rule 10.13 (a)-(h)--No change.
(i) Minor Rule Plan: Equity Floor Decorum and Minor Trading Rule
Violations
(1)-(2)--No change.
(3) Admission of Members to [Use of Badges on] the Equity Floor.
(EFPA 1-C(i))
(4)-(9)--No change.
(10) Badge Transfers. (EFPA 1-C(ii))
(11) Admission of Visitors to the Equity Floor (EFPA 1-C(iii))
* * * * *
MINOR RULE PLAN, RECOMMENDED FINE SCHEDULE
* * * * *
Rule 10.13(i)
Equity Floor Decorum and Minor Trading Rule Violations \1\
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\1\ Fines for multiple violations of Equity Floor Decorum and
Minor Trading Rules are calculated on a running two-year basis,
except that violations denoted with an asterisk are calculated on a
running one-year basis.
[[Page 54480]]
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1st viol. 2nd viol. 3rd viol.
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(1)-(2)--No change.
(3) Admission of Members to [Use
of Badges on] the Equity Floor
(EFPA 1-C(i))................... [$10]
$25 [$25]
$50 [$50]
$100
(4)-(9)--No change.
(10) Badge Transfers (EFPA 1-
C(ii)).......................... $100 $250 $500
(11) Admission of Visitors to the
Equity Floor (EFPA 1-C(iii)).... [$10]
$25 [$25]
$50 [$50]
$100
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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 self-regulatory organization
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 self-regulatory organization
has prepared summaries, set forth in sections (A) and (B) below, of the
most significant aspects of such statements.
A. Purpose
EFPA 1-C currently sets forth the rules and procedures on the
admission to the trading floor and the use of badges by Members.
Violations of these rules may currently result in recommended fines of
$10, $25 and $50 for first-, second- and third-time violations under
the Exchange's Minor Rule Plan (``MRP'').\2\
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\2\ See PSE Rule 10.13 (Procedures under the MRP); see also File
No. SR-PSE-96-26 (pending proposal to grant Exchange staff the
authority to make findings of violations and to impose monetary
fines under the MRP).
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The Exchange is proposing to modify EFPA 1-C and, correspondingly,
the MRP in two respects. First, the Exchange is proposing to add a
provision, entitled ``Badge Transfers,'' to EFPA 1-C, stating that a
Member may transfer his or her membership privileges to another person
of the same Member Firm for one or more days, provided that the Member
must first obtain the approval of the Exchange.\3\ The provision
further states that a Member who allows another person to use that
Member's badge for one full day or longer and who fails to obtain
Exchange approval for such transfer will be subject to the following
fines: $100 for first offense, $250 for a second offense and $500 for a
third offense.\4\
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\3\ See Exchange Act Release No. 37373 (June 26, 1996), 61 FR
34918 (July 3, 1996) (approving proposal to establish a new fee of
$50 for one-day transfers of membership, and noting that the fee for
temporary intrafirm transfers of membership (i.e., transfers for a
consecutive period lasting from two days to less than 30 days) is
$100.
\4\ Violations of EFPA 1-C are cumulative and the number of
offenses for a violation of that Advice are calculated on a twelve-
month rotating basis. Therefore, a violation in January would be
removed from the calculation in January of the following year. See
EFPA 1-C.
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Second, the Exchange is proposing to raise the recommended fines
for violations of the provisions in EFPA 1-C relating to the Admission
of Members and Admission of Visitors.\5\ Accordingly, a Member (or
Member Firm personnel) who repeatedly fails to have a permanent badge
on admission to the Trading Floor will be subject to fines of $25
(first offense), $50 (second offense), and $100 (third offense).\6\ In
addition, a Member who is responsible for a violation of the provisions
on the Admission of Visitors \7\ will also be subject to fines of $25
(first offense), $50 (second offense), and $100 (third offense), under
the proposed rule change.
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\5\ These fines are currently $10, $25 and $50 for first, second
and third violations, respectively.
\6\ See Note 3, supra.
\7\ These are specified in current subsections (6)-(8) of EFPA
1-C.
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B. Statutory Basis
The Exchange believes that the proposal is consistent with Section
6(b) of the Act, in general, and Section 6(b)(6), in particular, in
that it is designed to assure that Exchange members and persons
associated with such members are appropriately disciplined for
violations of the Rules of the Exchange.
III. Self-Regulatory Organization's Statement on Burden on
Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
IV. Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants, or Others
Written comments on the proposed rule change were neither solicited
nor received.
V. 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.
VI. 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 the PSE. All submissions should
refer to File No. SR-PSE-96-30 and should be submitted by November 8,
1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-26714 Filed 10-17-96; 8:45 am]
BILLING CODE 8010-01-M
