[Federal Register Volume 59, Number 143 (Wednesday, July 27, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18253]
[[Page Unknown]]
[Federal Register: July 27, 1994]
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SECURITIES AND EXCHANGE COMMISSION
Release No. 34-34416; File No. SR-Amex-94-15]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the New York Exchange, Inc., Relating to Amendments to Rule
205 (Odd-Lot Orders).
July 21, 1994.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. Sec. 78s(b)(1), notice is hereby given that on May
12, 1994, the American Stock Exchange, Inc. (``Amex'' 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 Amex proposes to amend Rule 205 (Manner of Executing Odd-Lot
Orders) (1) to provide that no differential shall be charged on odd-lot
order transactions (except for non-regular way trades); (2) to revise
provisions relating to the price at which certain odd-lot limit orders
shall be executed, and (3) to delete, reposition or re-number various
provisions relating to specific types of odd-lot orders.
The text of the proposed rule change is available at the Office of
the Secretary, the Amex and at the Commission.
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 Amex 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 Section 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 proposes to amend Rule 205 relating to the execution
of odd-lot orders (1) to eliminate the odd-lot differential for market
and limit orders; (2) amend provisions relating to the price at which
odd-lot limit orders are executed; and (3) delete, reposition or re-
number various provisions relating to specific types of odd-lot orders
in Rule 205, Section B.
Under current Exchange rules, market odd-lot orders to buy or sell,
as well as marketable limit orders, are executed with no differential
charged.\1\ However, a differential may be charged in connection with
executions of odd-lot limit orders, market orders to sell marked
``short,'' stop orders, and other types of orders (e.g., orders to buy
or sell ``at the close''). In order to enhance the competitiveness of
Exchange odd-lot execution procedures, the Exchange has determined to
require the execution of all odd-lot market or limit orders (except for
non-regular way executions under proposed Section C(2) of the rule)
without a differential.
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\1\Procedures for executing odd-lot market orders are currently
being implemented on a pilot basis, extended until August 8, 1994.
See Securities Exchange Act Release No. 33584 (February 7, 1994), 59
FR 6983 (February 14, 1994).
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Rule 205, Section A(2) would require that limited orders to buy
(sell) be executed at the price of the first round lot transaction
which is at or below (above) the specified limit price (the ``effective
transaction'' price). Sell limited orders marked ``short'' would be
executed at the price of the first round lot transaction which is at or
above the specified limit and which is also higher than the last
different round lot transaction price (a ``plus'' or ``zero-plus''
tick). Marketable limit orders would continue to be executed in
accordance with procedures applicable to market orders.
Provisions relating to orders that are infrequently or never
entered (i.e., limited orders to buy an offer, sell on bid, ``immediate
or cancel''; buy or sell marked ``or on close'') would be deleted.
Provisions relating to ``seller's option'' or cash trades in Section C
would be deleted and subsumed by new Section C(2) (Non-Regular Way
Trades). A differential could be charged on such executions.
2. Statutory Basis
The proposed rule change will advance the objectives of Section
6(b) of the Act in general and furthers the objectives of Section
6(b)(5) in particular in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, and in general, to protect investors and the public
interest.
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.
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 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 approved 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 NW., 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 maybe withheld from the public in accordance with the provisions
of 5 U.S.C. Sec. 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 Amex. All
submissions should refer to File No. SR-Amex-94-15 and should be
submitted by August 17, 1994.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland
Deputy Secretary.
[FR Doc. 94-18253 Filed 7-26-94; 8:45 am]
BILLING CODE 8010-01-M
