[Federal Register Volume 60, Number 132 (Tuesday, July 11, 1995)]
[Notices]
[Pages 35766-35771]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16920]
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[[Page 35767]]
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35931; File No. SR-NYSE-95-22]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the New York Stock Exchange, Inc. Relating to the Exchange's
Wireless Data Communications Initiatives
June 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 June 1,
1995, the New York Stock Exchange, Inc. (``NYSE'' 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 Exchange is proposing to introduce onto its trading floor
wireless data communications technology that allows a member in a
trading crowd or elsewhere on the floor to communicate with others by
means of a hand-held wireless device. The Exchange is also proposing to
issue an interpretation with respect to NYSE Rule 117 which requires
members' orders to be in writing.
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
Purpose
The Exchange is proposing to introduce wireless data communications
in order to expedite, and make more efficient, the process by which
members receive and execute orders on the floor of the Exchange. The
Exchange also is proposing to issue an interpretation to NYSE Rule 117
(Orders of Members To Be in Writing) that would deem a transmission of
an order that a member receives by means of an authorized hand-held
device to constitute a ``written order.''
a. Interpretation of NYSE Rule 117
The use of the Exchange's proposed wireless data communications
technology will affect Exchange Rule 117 which prohibits members on the
floor of the Exchange from making a bid, offer or transaction for or on
behalf of another member except pursuant to a written order.\1\ The
Exchange is proposing an interpretation that will deem a transmission
of an order that a member located on the floor of the Exchange receives
by means of an authorized hand-held device to constitute a ``written
order'' for the purposes of Rule 117 if the member can show that the
transmission of the order:
\1\ Rule 117 also provides that if a member to whom an order has
been entrusted leaves the trading crowd without actually
transferring the written order to another member, the order shall
not be represented in the market during his absence. The use of
wireless data communications devices does not affect this portion of
Rule 117. If a member receives an order by means of a transmission
to his wireless device and he leaves a trading crowd without
transferring a written version of the order to another member, the
order may not be represented in the market in his absence.
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(i) Provides adequate information relating to the price, size and
time of the order, the cancellation of the order, and the like; \2\
\2\ All orders entered from off the floor must be transmitted to
a booth terminal before they are retransmitted to a hand-held
device.
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(ii) Satisfies the Exchange's audit trail requirements; and
(iii) Satisfies all other Exchange reporting and recordkeeping
requirements.\3\
\3\ In the case where an order is transmitted electronically
from a member's off-floor location to a booth terminal and then the
order is retransmitted from the booth terminal to a member's hand-
held device, a record must be established and maintained which
reflects the time the order was received by the booth terminal and
the time the order was received by the hand-held device. The record
of time of receipt by the booth terminal may be established and
maintained by such terminal or by a server which records the time
such terminal acknowledges receipt of the order. The booth terminal
must display the order (and the time of receipt, on inquiry) and the
automated record of the order (including time of receipt) must be
supplemented by a paper record of the order at the booth. If the
paper record cannot be produced at the booth terminal, it must then
be produced by hand. The record of time of receipt by a hand-held
device may be established and maintained by such device or by the
server or the booth terminal which receives a message
acknowledgement from the hand-held device. Regardless of whether the
hand-held device records are maintained in such device or in the
booth terminal or a server, such records must be capable of being
printed at the booth location.
b. Wireless Communications Plan
The Exchange's proposed wireless data communications technology
involves the floor-based use of wireless hand-held data communications
devices. The Exchange proposes to adopt a four-phase process to
integrate new technology into the floor environment. The Exchange's
basic operating premise is to allow private vendors to provide wireless
data communications services to Exchange members on the floor, but only
in a manner that treats members equitably and does not unfairly
discriminate among members. The Exchange also proposes to provide its
own wireless data communications service on a non-discriminatory basis.
Phase I
In Phase I, which the Exchange has already completed, the Exchange
supervised and monitored three ``proof-of-concept'' pilot programs on
the floor of the Exchange.\4\ Each of the programs tested the viability
of the operation and functionality of wireless hand-held data devices
on the floor. Members participating in the pilot programs were
instructed to use the devices strictly for the purposes of evaluating
the devices and to compare results that might have been achieved had
the devices been used for actual trading purposes with results from
actual trades using traditional paper tickets, telephones and the like.
\4\ One pilot program was conducted by the Exchange and the
other two were conducted by member-sponsored, private wireless data
communications vendors.
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The Phase I pilot programs allowed the Exchange to conclude that
the technology will function in the Exchange's floor environment and
would improve broker efficiency. They also made clear that introducing
the technology on the floor on a wide scale (i.e., allowing the
technology to be offered to all members) would require the Exchange to
install a robust, standardized, Exchange-controlled infrastructure in
order to ensure reliable, secure wireless data communications.
Phase II
Phase II, which the Exchange proposes to commence upon Commission
approval of the proposed rule change, would involve additional, more
structured, pilot testing of independent wireless data communications
services, including that offered by the Exchange. A prototype of the
infrastructure that the Exchange hopes will eventually support all such
[[Page 35768]]
services will support the Exchange's Phase II pilot program. A
description of the primary characteristics of the Phase II pilot
programs follows.
1. Scope of Phase II Pilot Programs. (a) Functions of Pilot
Programs. For the purposes of the Phase II pilot programs, the Exchange
proposes to permit members to use hand-held data devices for actual
trading purposes. That is, a participating member may rely on the
information it receives on the floor by means of the device to make
trading decisions, without having to rely on such conventional trading
tools as paper tickets and telephones.
(b) Number of Pilot Programs. In order to preserve the ability of
the Exchange to satisfy its regulatory oversight responsibilities, the
Exchange reserves the right to limit the number of private vendors that
it will allow to provide those pilot programs. The Exchange will choose
vendors in its sole discretion. In the absence of mitigating
circumstances, the Exchange currently contemplates that it will accept
vendor Phase II pilot programs on a ``first-come, first-serve'' basis.
(c) Size of Pilot Programs. Similarly, the Exchange will -initially
limit the number of members that may participate in any vendor's Phase
II pilot program to 25. That is, at the commencement of Phase II, no
vendor may provide its pilot program to more than 25 members. This
limitation will facilitate the control, monitoring and evaluation of
pilot program operations. Where more than 25 members wish to
participate in a vendor's Phase II pilot program, the Exchange will
require the vendor to describe its procedures for selecting which 25
members it will allow to participate. Those procedures must provide a
fair and non-discriminatory environment and must otherwise comply with
the Exchange's selection requirements. The Exchange will develop
procedures for selecting its own pilot program participants on the same
basis.
If the Exchange determines that circumstances so warrant (based on
its actual experience with the Phase II pilot programs), it may permit
increases, or require decreases, in the maximum allowable number of
pilot programs or the number of participants in any or all Phase II
pilot programs.
2. Exchange Support of Vendor Systems. The Exchange will use
reasonable efforts to accommodate the installation of a participating
vendor's base stations, battery charging equipment, antennae and other
such service facilities. However, the Exchange will do so only at the
vendor's expense and only insofar as any such installation does not
necessitate any substantial modification to the Exchange's facilities
and does not interfere with the Exchange's development and installation
of its planned wireless data communications system infrastructure or
other aspects of the Exchange's wireless data communications, or other
Exchange technology upgrade initiatives.
The Exchange will have no other obligation to support any aspect of
the vendor's communications system. This means, among other things,
that the Exchange will have no obligation to install, maintain or
support base stations, base antennae, battery charging equipment, user
equipment, user training, or any other special facilities, services or
features related to the vendor's system.
3. Exchange Charges. Except as described above in connection with
vendor responsibility for installation costs, the Exchange does not
currently plan to charge vendors for the privilege of providing a Phase
II pilot program. However, the Exchange may impose charges on vendors
that provide wireless data communications services during Phase IV. If
the Exchange does determine to impose Phase IV charges or any other
charges, it would first seek Commission approval of any such charge.
4. Vendor Requirements. (a) Contract with the Exchange. The
Exchange will not permit a vendor to provide a Phase II pilot program
until the vendor and the Exchange have entered into the Exchange's
Phase II pilot program agreement.\5\ That agreement codifies the terms
and conditions that are described in the proposed rule change and
pursuant to which the Exchange is willing to allow a vendor to provide
its Phase II pilot program.
\5\ A copy of the Exchange's Phase II pilot program agreement is
included in the Exchange's Form 19b-4 which may be examined at the
places specified in Item IV below.
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(b) Contracts with Participating Members. The Exchange will not
permit a vendor to provide its Phase II pilot program to a particular
member until the vendor and the member have entered into an agreement
which (i) extends to the Exchange third-party beneficiary status and
the right to enforce the agreement, (ii) codifies the Exchange's
required provisions regarding the terms and conditions pertaining to
members' receipt of a wireless data communications service that the
proposed rule change describes (``Service Agreement Terms'') \6\ and
(iii) specifies the parties' obligations as to the following matters:
\6\ The Exchange's Service Agreement Terms are set forth in
Attachment B to Exhibit A in the Exchange's Form 19b-4 which may be
examined at the places specified in Item IV below.
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(A) The degree of responsibility and liability, if any, that the
vendor agrees to assume in the event that data is lost or delayed
through the system or losses otherwise occur as a result of the
member's use of the system;
(B) the amount of training that the vendor will provide;
(C) the maintenance and system support that the vendor will
provide;
(D) any technological limitations or other restrictions on the
member's participation (e.g., restrictions on where the member may use
the device or the types of orders or other messages that the member may
receive or transmit by means of the device);
(E) the availability of equipment and spare parts; and
(F) any charges that the vendor may impose for the use of its
system.
In addition, a vendor's agreements with members receiving its
service must be non-discriminatory. That is, the vendor must agree to
offer its system to members pursuant to fair and unbiased terms and
conditions that do not unfairly discriminate against any Exchange
member. The Exchange will require each vendor to submit each such
agreement or any form of agreement to the Exchange for the Exchange's
prior approval so as to allow the Exchange to monitor that it comports
with the Exchange's Service Agreement Terms and does not give one or
more of the vendor's subscribing members an unfair competitive
advantage over other of the vendor's subscribing members.
(c) Use of Radio Frequencies. (i) Pre-Infrastructure Frequencies.
During Phase II, the Exchange will test a prototype of its proposed
wireless data communications infrastructure and will design and,
perhaps during Phase II, install and test the infrastructure itself.
The Exchange plans to use the 2.4 Ghz ``unlicensed'' radio band for
both the prototype and the actual infrastructure.
Because the Exchange cannot yet assess whether, or the extent to
which, vendor pilot programs will interfere with the infrastructure or
with other Exchange uses of radio frequencies, the Exchange reserves
the right to require a vendor to refrain from using a particular
frequency if the Exchange determines that the use would interfere with
any of the Exchange's wireless systems. In particular, the Exchange
plans to preclude Phase II pilot program vendors from using the 2.4 Ghz
radio band for part or all of the Phase II period.
[[Page 35769]]
To ensure an absence of interference with Exchange systems, the
Exchange will require vendors to receive advance Exchange approval of
any radio frequency that a vendor may wish to use for the purposes of
its Phase II pilot program.
In addition, the Exchange reserves the right to notify a vendor of
any interference with Exchange systems that the vendor's wireless
transmissions may be causing. The vendor would then have to cease to
use the interfering frequency immediately or would have to otherwise
resolve the interference problem to the Exchange's satisfaction.
The Exchange will not allow a vendor to use infrared technology.
(ii) Post-Infrastructure Frequencies. The Exchange, after
consultation with its system integrator, will determine when the
Exchange's proposed wireless data communications infrastructure is
ready for pre-production pilot testing and/or full production
implementation. The Exchange will then direct the orderly migration of
the wireless data communications services to the infrastructure.
Pursuant to a time schedule that the Exchange will establish, the
Exchange will then require each vendor that wishes to continue to
provide a wireless data communications system on the floor to conform
its system to, and cause its system to interface with, the
infrastructure. The vendors would bear all expenses of migrating from
its Phase II radio frequency to the radio frequency that the Exchange's
infrastructure will support, and of adopting the communications
specifications and protocols that the infrastructure will require.
(d) Permissible Communications. A vendor's Phase II pilot program
must restrict wireless data communications to communications between a
hand-held device used by a member on the floor and a terminal in a
floor booth location. The Exchange will prohibit all floor-based
wireless data communications between any other points.
However, a pilot program participant may effect communications
between a floor booth terminal and a member's off-floor system in the
same ``wired'' manner as it can today, subject to applicable rules and
policies. In addition, the pilot program participant's booth terminal
may interface with the Exchange's Common Message Switch (``CMS'') in
order to allow the member to enter orders into the Exchange's SuperDOT
System complex. That interface would not differ from today's booth/CMS
interfaces and would be subject to existing CMS interface standards.
(e) Fair Treatment of Participating Members. Because wireless data
communications systems may imbue users with real or perceived
competitive advantages, each vendor must demonstrate to the Exchange
that it is willing and able to offer any member who wishes to use that
vendor's system the opportunity to participate in the vendor's pilot
program, subject to (i) the capacity constraints of the vendor's
system, (ii) reasonable lead-time that the vendor may need to bring new
users on-line and (iii) the above-mentioned limit of 25 participants
per pilot program. The Exchange will require each vendor to provide its
pilot program to participating members on fair, unbiased, non-
discriminatory terms, including the provision of adequate support for
all such participating members. Creating a level playing field requires
each vendor, among other things, to offer its service in a reasonable
manner that does not give the vendor (if it is also a member), or a
member that is a sponsor or affiliate of the vendor, an unfair
advantage over other of the vendor's competing members.
The Exchange will prohibit a vendor from commencing to provide its
pilot program to any member that primarily trades \7\ in one stock
unless and until (i) the vendor is prepared to provide its service to
all members who primarily trade in the same stock and who desire to
participate in the pilot program or (ii) the Exchange otherwise
permits.
\7\ The Exchange deems a member to ``primarily trade in one
stock'' if more than 50 percent of either his trades or share volume
occur in that stock. The Exchange will base determinations of
percentages of trades and share volumes on, among other things, the
Exchange's audit trail data.
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In addition, the Exchange will require each vendor to refrain from
falsely representing that it is the sole vendor of wireless data
communications services on the floor and to assure that each member
that expresses an interest in participating in its Phase II pilot
program is aware that the Exchange will require the vendor's service to
move to the wireless data communications infrastructure that the
Exchange plans to develop and install.
(f) Description of System. As a condition precedent to the
Exchange's approval of a vendor's pilot program, the Exchange will
require each vendor to provide the Exchange with a detailed description
of the capabilities and limitations of the vendor's system and its
functionality. That description must be approved by the Exchange and
must satisfy the description requirements set forth in the Exchange's
proposed ``Agreement for Wireless Data Communications Service,'' \8\
including a description of such things as:
\8\ A copy of the Exchange's proposed ``Agreement for Wireless
Data Communications Service'' is set forth in Attachment A to
Exhibit A in the Exchange's Form 19b-4 which may be examined at the
places specified in Item IV below.
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(i) The number of members that the system can support (and if the
number of users needs to be ``scaled'', a description of the time frame
required for each upgrade to the system's capacity);
(ii) Technical specifications (e.g., the radio frequency, the
transmission method (such as frequency hopping spread spectrum), system
protocols and hardware descriptions, etc.);
(iii) Operating plans (e.g., the manner for charging devices, for
distributing them to members each day and for collecting them at day's
end);
(iv) The functionality of the vendor's hand-held device;
(v) The manner for assuring compliance with all rules and
regulatory requirements of the Exchange, the Commission and the Federal
Communications Commission; and
(vi) Such other technical information, records and other items as
the Exchange may require to determine whether the vendor's proposed
pilot program will interfere with the Exchange's proposed
infrastructure or the pilot programs of the Exchange or of any other
vendor or to determine whether the vendor is complying with its
agreement with the Exchange.
The Exchange will further require each vendor to provide advance
notice of any changes to the technical specifications of its system, to
update its description as necessary to keep the description current and
to cause its pilot program to perform in compliance with its
description at all times. The Exchange may prohibit a vendor from
effecting a proposed modification to its pilot program if the Exchange
determines that the modification would interfere with other aspects of
Phase II or other operations of the Exchange.
In addition, if the Exchange determines that equipment or software
that a vendor uses for the purposes of its service interferes, or is
otherwise inconsistent, with other aspects of the wireless data
communications technology on the floor or other Exchange systems, the
Exchange may require the vendor to change the equipment or software or
to modify the manner in which it provides its service.
(g) Reporting and Cooperation. The Exchange will require vendors to
submit to the Exchange whatever documentation and/or periodic reports
that the Exchange may require to assure
[[Page 35770]]
that the vendor's Phase II pilot program is operating in compliance
with existing regulatory requirements and is not interfering with other
pilot programs or production operations of the Exchange. The Exchange
will also require vendors to supply the Exchange with such data
relating to its pilot program as the Exchange may reasonably request so
as to enable the Exchange to evaluate the features of the vendor's
pilot program and to develop the Exchange's infrastructure in a way
that provides adequate support of private systems.
In addition, each vendor must agree to cooperate with the Exchange
as necessary to assist the Exchange in its dealings with the
Commission. That may mean providing information concerning such matters
as complaints received, system and device failures, the perceived
strengths and weaknesses of the system, the number of pilot program
participants, the number of pilot program transmissions and such other
information as the Commission may require.
(h) Compliance with Regulatory Requirements. The Exchange will
require each vendor to acknowledge, and to assure that each of its
pilot program participants acknowledges, that (i) it understands that
the Exchange has submitted to the Commission, and the Commission has
approved, the terms and conditions governing the Phase II pilot
programs and (ii) it is familiar with those terms and conditions. The
Exchange will require each vendor to agree to comply, and to cause each
of its pilot program participants to agree to comply, with those terms
and conditions.
In addition, the Exchange will hold each vendor responsible for
assuring that its pilot program complies with all Exchange rules and
with any rules and regulations of the Commission or the Federal
Communications Commission. This includes compliance with Exchange Rule
117 (Orders of Members to Be in Writing), which require certain orders
to be in writing, and Commission Rule 17a-3, which imposes record-
keeping requirements.
The Exchange will also require each vendor to agree to comply with,
and to assure that its participating members will comply with, such
other limitations and restrictions as the Exchange may determine to be
necessary to assure the integrity of other aspects of the Phase II
pilot programs, the Exchange's development of the infrastructure or
other Exchange systems.
(i) Exculpation of the Exchange. The Exchange will require each
vendor to agree that the Exchange assumes no liability or
responsibility for any inaccuracies, delays, omissions, security
breaches or other failures that may result from any use of the vendor's
wireless data communications system. Furthermore, the Exchange will
require any vendor to agree, and to cause each of its participating
members or member organizations to agree, to indemnify and defend the
Exchange against, and hold the Exchange harmless from, any losses or
claims arising from any use of the vendor's system.
(j) Termination of Service. (i) By the Exchange. The Exchange
reserves the right to withdraw its permission for a vendor to provide a
Phase II pilot program, either in its entirety or as to any particular
member or function. The Exchange will base any determination to
withdraw its permission on feedback that the Exchange receives from the
program's participants or other members, or other evidence that the
Exchange may collect. In making any such determination, the Exchange
will examine the merits of the vendor's particular pilot program. In
addition, the Exchange will examine whether one or more Phase II pilot
programs, whether alone or in combination, is disrupting the fair,
orderly and efficient conduct of business, including any interference
with the Exchange's systems and any reduction in the ability of program
participants (A) to communicate orders, reports and related information
in a timely and accurate manner and (B) to provide their customers with
an opportunity to receive best-price executions.
(ii) By the Vendor. The Exchange will allow a vendor to terminate
its provision of the service to a participating member only (A) for
``cause'', upon 10 days written notice to the Exchange and the member
(unless the Exchange agrees that circumstances warrant a shorter
termination period or immediate termination), which notice must explain
the ``cause'' in detail, or (B) because the vendor no longer wishes to
provide its service on the floor of the Exchange to any and all
members, upon 60 days written notice to the Exchange and each of the
vendor's participating members.
(iii) By a Participating Member. The Exchange will require each
vendor to allow any member participating in the vendor's Phase II pilot
program to cease its participation immediately upon notice to the
vendor.
(iv) Removal of Equipment. Insofar as a vendor ceases to provide a
Phase II pilot program, either in its entirety or as to any particular
member, whether because the Exchange determines to withdraw its
permission as to that vendor or member or as to all vendors or because
the vendor determines to cease providing its service, then the Exchange
will require the affected vendor to remove, and to assure that each of
its participating members removes, from the floor all affected pilot
program equipment.
5. Participating Member Requirements. The Exchange will require
each member that wishes to participate in a vendor's Phase II pilot
program to agree to comply with Exchange-prescribed terms and
conditions. The Exchange will not contract directly with those
participating members, but, instead, will require each vendor to
contract with each of the vendor's participating members for the
benefit of the Exchange, as described above. The Exchange will require
vendors to include in those contracts the following member
acknowledgements:
(a) That the Exchange has no responsibility or liability with
respect to the vendor's system;
(b) That the member will indemnify and defend the Exchange and hold
the Exchange harmless for claims or losses evolving from the member's
use of the system;
(c) That the Exchange can direct the vendor to terminate its
service, or to terminate the vendor's provision of the service to the
member, if the Exchange deems the circumstances to warrant that action;
and
(d) That the member's use of the vendor's system shall be subject
to all applicable rules, regulations and other requirements of the
Exchange, the Commission and the Federal Communications Commission.
Phase III
In Phase III, the Exchange will conduct on the floor a
preproduction pilot test of its wireless data communications system
infrastructure. The Exchange will design that infrastructure to use the
2.4 Ghz radio frequency band and to support all hand-held device
wireless data communications services of the Exchange and vendors. The
Exchange will select an integrator to assist in the design,
installation, testing and maintenance of the infrastructure.\9\
\9\ The Exchange plans to have the integrator define
requirements, analyze technology and design the infrastructure
during Phase II.
During Phase III, the Exchange plans to allow its wireless data
communications service to interface with the Exchange's Broker Booth
Support System.
As the Exchange gains confidence in the capacity and reliability of
the
[[Page 35771]]
infrastructure, the Exchange may invite, or even require, vendors to
test their systems on the infrastructure and/or to migrate to it. The
timing of such invitations or requirements will depend on the timing
and success of the testing of the infrastructure.
The Exchange will continue to limit the size of each vendor's
wireless data communications system during Phase III.
Phase IV
One Phase IV commences, the Exchange will have installed and tested
the infrastructure, which would then be fully operational and will have
moved its own wireless data communications system to the
infrastructure. At that point, the Exchange will have commenced the
production roll-out of the wireless data communications infrastructure
and will have directed all vendors to migrate their systems to the
infrastructure.
During Phase IV, the Exchange will permit all authorized vendors to
offer their wireless data communications services (and the Exchange
will offer its own system) to such number of members as their
respective systems can accommodate. At that point, the Exchange
anticipates that floor-based wireless data communications technology
will be available to all members.
Terms and Conditions Applicable to Vendors and Members During Phase III
and Phase IV
As in respect to Phase II, the Exchange reserves the right to limit
the number of vendors that may provide wireless data communications
systems on the floor during Phase III and Phase IV, based on the
ability of the Exchange to maintain its regulatory oversight
responsibilities in a satisfactory manner. In addition, as the Exchange
gains experience with the use of wireless data communications
technology on its floor, it may determine that additional restrictions,
such as in respect of permissible transmissions or hardware, are
warranted.
The Exchange anticipates that it will impose the same contract
structure on vendors and members during Phase III and Phase IV as it
will impose in Phase II. The continued use of Phase II contracts in the
later phases will assure that vendors and members remain subject to
regulatory, reporting and other applicable requirements in an
uninterrupted manner.
Statutory Basis
The basis under the Act for the proposed rule change is the
requirement under Section 6(b)(5) that an exchange have rules that are
designed to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, to protect investors
and the public interest, and that are not designed to permit unfair
discrimination between customers, issuers, brokers or dealers. In
addition, the proposed rule change is based on the requirement under
Section 6(b)(4) that an exchange have rules that provide for the
equitable allocation of reasonable dues, fees and other charges among
its members and other persons using its facilities.
B. 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.
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 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 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 NYSE. All
submissions should refer to File No. SR-NYSE-95-22 and should be
submitted by August 1, 1995.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. 95-16920 Filed 7-10-95; 8:45 am]
BILLING CODE 8010-01-M
