[Federal Register Volume 61, Number 37 (Friday, February 23, 1996)]
[Notices]
[Pages 7032-7033]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-4122]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36851; File No. SR-CHX-96-05]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the Chicago Stock Exchange,
Incorporated Relating to Acting as Agent for Members and Member
Organizations
February 15, 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 February
7, 1996, the Chicago Stock Exchange, Incorporated (``CHX'' 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 proposes to amend Article XXI, Rule 13 of the CHX's
rules relating to the CHX acting as agent for certain persons.
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
In Securities Exchange Act Release No. 36684 (January 5, 1996), 61
FR 1195 (January 17, 1996) (File No. SR-CHX-95-27), the Commission
approved a proposed rule change by the Exchange relating to its
decision to withdraw from the clearance and settlement and securities
depository businesses conducted by its subsidiaries, among other
things. In Securities Exchange Act Release No. 36723 (January 16,
1996), 61 FR 1803 (January 23, 1996) (File No. SR-CHX-95-29), the
Commission approved a proposed rule change by the Exchange making
certain changes to its rules that were necessitated by its withdrawal
from those businesses. One change related to the adoption of a new
Article XXI, Rule 13 that permits the Exchange to act as agent on
behalf of specialists, market makers, and floor brokers.\1\ However, it
has become apparent that the Exchange needs the flexibility to be able
to provide this service to qualified non-floor members that are members
of a Qualified Clearing Agency (as that term is defined in the
[[Page 7033]]
CHX rules).\2\ Thus, the purpose of the proposed rule change is to
expand the scope of this agency service.
\1\ Specifically, Article XXI, Rule 13 authorizes the Exchange
to enter into agreements with specialists, market makers, or floor
brokers to perform various functions on behalf of and as agent for
them. Such functions may include making deposits or withdrawals from
a bank account, borrowing securities, providing and keeping reports
and records, and performing special cashiering functions, among
other things.
\2\ See CHX Article XXI, Rule 4, Interpretation and Policy .03.
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2. Statutory Basis
The proposed rule change is consistent with Section 6(b)(5) of the
Act \3\ in that it is designed to promote just and equitable principles
of trade, to remove impediments to and perfect the mechanism of a free
open market and a national market system, and, in general, to protect
investors and the public interest.
\3\ 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 a burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change: (1) Does not
significantly affect the protection of investors or the public
interest; (2) does not impose any significant burden on competition;
and (3) the Exchange has provided the Commission with written notice of
its intent to file the proposed rule change at least five business days
prior to the filing date, it has become effective pursuant to Section
19(b)(3)(A) of the Act \4\ and Rule 19b-4(e)(6) thereunder.\5\
\4\ 15 U.S.C. 78s(b)(3)(A).
\5\ 17 CFR 240.19b-4(e)(6).
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A proposed rule change filed under Rule 19b-4(e)(6) does not become
operative prior to thirty days after the date of filing or such shorter
time as the Commission may designate if such action is consistent with
the protection of investors and the public interest. In conjunction
with the Exchange's recent withdrawal from the securities clearance and
depository businesses, the Commission approved new CHX Article XXI,
Rule 13, which permits the CHX to act as agent on behalf of
specialists, market makers, and floor brokers. As it subsequently has
become apparent to the Exchange that the CHX needs the flexibility to
be able to act as agent on behalf of non-floor members that are members
of a Qualified Clearing Agency, the CHX requests that the Commission
accelerate the implementation of the proposed rule change so that it
may take effect prior to the thirty days specified under Rule 19b-
4(e)(6)(iii).\6\ The Commission finds that the proposed rule change is
consistent with the protection of investors and the public interest and
therefore has determined to make the proposed rule change operative as
of the date of this order.
\6\ 17 CFR 240.19b-4(e)(6)(iii).
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At any time within 60 days of the filing of such proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
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 Exchange. All
submissions should refer to File No. SR-CHX-96-05 and should be
submitted by March 15, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-4122 Filed 2-22-96; 8:45 am]
BILLING CODE 8010-01-M
