[Federal Register Volume 64, Number 160 (Thursday, August 19, 1999)]
[Notices]
[Pages 45294-45295]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-21539]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-41735; File No. SR-Amex-99-24]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the American Stock Exchange
LLC Relating to the Amendment of Commentary .01 to Exchange Rule 340
and Amendment of Exchange Rule 590
August 12, 1999.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and rule 19b-4 thereunder,\2\ notice is hereby given that
on July 9, 1999, the American Stock Exchange LLC (``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 Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s (b)(1).
\2\ 17 CFR 240.19b-4
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
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 Amex 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 1993, the New York Stock Exchange (``NYSE'') amended its rules
to require all clerks to submit their fingerprints and Forms U-4 as a
prerequisite to admission to the trading floor.\3\ The intent of the
rule was to prevent an individual subject to a statutory
disqualification from being employed on the exchange. At the same time,
the NYSE required employers to report the termination of a clerk on
Form U-5. The NYSE also amended its rules to provide for the imposition
of a $1,000 fine on members and member organizations that failed to
comply with the NYSE's floor clerical personnel procedures.\4\ The Amex
currently requires candidates for membership to be fingerprinted and
complete Form U-4, but does not impose a similar requirement on clerks.
The Amex also does not require members and member
[[Page 45295]]
organizations to report terminations of clerks.
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\3\ NYSE Rule 35, Supplementary Material .50 and .60. See
Securities Exchange Act Release No. 33045 (October 14, 1993), 58 FR
54179 (October 20, 1993) (File No. SR-NYSE-93-28).
\4\ See Securities Exchange Act Release No. 32422 (June 7,
1993), 58 FR 32972 (June 14, 1993) (File No. SR-NYSE-93-14).
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The Exchange now proposes to amend Commentary .01 to Amex Rule 340
to require all current and prospective clerks to be fingerprinted and
submit Form U-4.\5\ Fingerprints will be submitted to the Department of
Justice for a fingerprint report. All existing clerks will have eight
weeks from the date the proposed rule change becomes operative to
supply their fingerprints to the Exchange and submit a completed Form
U-4. After the proposed rule changes become operative, new clerks and
temporary clerks will not be permitted on the trading floor until they
have been fingerprinted and submitted a Form U-4. A charge for the
fingerprinting will be assessed against the clerk's employer.\6\ The
Exchange also proposes that members and member organizations must
report the discharge or termination of any clerk to the Exchange on
Form U-5. Members and member organizations will be responsible for
obtaining and submitting a terminated clerk's Amex identification badge
with the Form U-5 to the Exchange's Membership Services Department.
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\5\ In the event that a clerk has already been fingerprinted and
filed a U-4, the Exchange will accept in lieu of a new U-4 and
fingerprints, a copy of the most recent fingerprint report and a
written statement from his or her firm's compliance officer or
employer/member that the U-4 is current and no reportable events
have occurred.
\6\ The current charges are $9.60 to have fingerprints taken and
$25.50 for processing by the Department of Justice.
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Members and member organizations that fail, or whose employees
fail, to submit the required fingerprints, Form U-4s and Form U-5s
within the stipulated times face disciplinary action by the Exchange.
In this regard, the Exchange proposes to amend the Minor Fine Plan
(Amex Rule 590) to add failure to timely submit Form U-5s to the list
of infractions that may be disciplined under part 3 of the Rule. This
provides that members and member organizations may be fined $50 per day
for the late filing of required reports. Part 1 of the Minor Fine Plan
also will be amended to provide fines for the employers of clerks that
do not submit fingerprints and Form U-4s within the required time frame
after the Rule becomes operative. The minimum fines under Part 1 of
Rule 590 is $500 for individuals and $1,000 for member organizations.
The purpose of the proposed rule change is to establish better
control over admission to the trading and to ensure that only qualified
persons have floor access.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the Act
\7\ in general and further the objectives of Section 6(b)(5) \8\ in
particular in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to remove impediments to and perfect the mechanism
of a free and open market and a national market system, and, in
general, to protect investors and the public interest, and are not
designed to permit unfair discrimination between customers, issuers,
brokers and dealers.
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\7\ 15 U.S.C. 78f(b).
\8\ 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 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 Chance 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) does not become operative for 30 days after the date of filing
or such shorter time as the Commission may designate if consistent with
the protection of investors and the public interest, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\9\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
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At any time within 60 days of the filing of the 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, including whether the proposed rule
change is consistent with the Act. 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-
0609. 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 also will be
available for inspection and copying at the principal office of the
Amex. All submissions should refer to File No. SR-Amex-99-24 and should
be submitted by September 9, 1999.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-21539 Filed 8-18-99; 8:45 am]
BILING CODE 8010-01-M
