[Federal Register Volume 61, Number 216 (Wednesday, November 6, 1996)]
[Notices]
[Page 57507]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28520]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37903; File No. SR-PSE-96-36]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Pacific Stock Exchange, Incorporated Relating to a
Requirement that All PSE Floor Brokers Maintain Error Accounts
October 31, 1996.
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
17, 1996, the Pacific Stock Exchange, Inc. (``PSE'' 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 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 Exchange is proposing to amend its rules to provide that each
floor broker on the Exchange must establish and maintain an error
account for carrying positions resulting from errors.
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, 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
The Exchange is proposing to adopt new Rule 4.10(c) to provide that
each member organization whose principal business is as a floor broker
on the Exchange and who is not self-clearing must establish and
maintain an account with a clearing member of the Exchange, for the
sole purpose of carrying positions resulting from bona fide errors made
in the course of its floor brokerage business. The proposed rule
further provides that, with respect to options floor brokers only, such
an account for option transactions must be maintained with an entity
that is also a member of the Options Clearing Corporation.
The purpose of the rule change is to enhance the Exchange's ability
to detect and deter rule violations committed by floor brokers that may
arise in connection with trading errors. The Exchange believes that the
rule is consistent with Rule 703(c)(vi) of the Philadelphia Stock
Exchange.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act \1\ in general and furthers the objectives
of Section 6(b)(5) in particular \2\ in that it is designed to promote
just and equitable principles of trade and to protect investors and the
public interest.
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\1\ 15 U.S.C. 78f(b).
\2\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any inappropriate 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
with respect to 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 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 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 Room. Copies of such filing will also be
available for inspection and copying at the principal office of the
Exchange. All submissions should refer to File No. SR-PSE-96-36 and
should be submitted by November 27, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\3\
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\3\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-28520 Filed 11-5-96; 8:45 am]
BILLING CODE 8010-01-M
