[Federal Register Volume 61, Number 183 (Thursday, September 19, 1996)]
[Notices]
[Pages 49363-49365]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-23979]
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SECURITIES AND EXCHANGE COMMISSION
Submission for OMB Review; Comment Request
Upon Written Request, Copies Available From: Securities and
Exchange Commission, Office of Filings and Information Services,
Washington, DC 20549.
Extension:
Rule 12d2-1, SEC File No. 270-98, OMB Control No. 3235-0081
Rule 12d2-2 and Form 25, SEC File No. 270-86, OMB Control No. 3235-
0080
Rule 15Ba2-5, SEC File No. 270-91, OMB Control No. 3235-0088
Rule 15c3-1, SEC File No. 270-197, OMB Control No. 3235-0200
Rule 17a-10, SEC File No. 270-154, OMB Control No. 3235-0122
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') has submitted to the Office of Management
and Budget requests for approval of extension on the following:
Rule 12d2-1 was adopted in 1935 pursuant to Sections 12 and 23 of
the Securities Exchange Act of 1934 (the ``Act''). The Rule provides
the procedures by which a national securities exchange may suspend from
trading a security that is listed and registered on the exchange. Under
Rule 12d2-1, an exchange is permitted to suspend from trading a listed
security in accordance with its rules, and must promptly notify the
Commission of any such suspension, along with the effective date and
the reasons for the suspension.
Any such suspension may be continued until such time as the
Commission may determine that the suspension is designed to evade the
provisions of Section 12(d) of the Act and Rule 12d2-1 thereunder.\1\
During the continuance of such suspension under Rule 12d2-1, the
exchange is required to notify the Commission promptly of any change in
the reasons for the suspension. Upon the restoration to trading of any
security suspended under the Rule, the exchange must notify the
Commission promptly of the effective date of such restoration.
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\1\ Rule 12d2-2 prescribes the circumstances under which a
security may be delisted, and provides the procedures for taking
such action.
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The trading suspension notices serve a number of purposes. First,
they inform the Commission that an exchange has suspended from trading
a listed security or reintroduced trading in a previously suspended
security. They also provide the Commission with information necessary
for it to determine that the suspension has been accomplished in
accordance with the rules of the exchange, and to verify that the
exchange has not evaded the requirements of Section 12(d) of the Act
and Rule 12d2-2 thereunder by improperly employing a trading
suspension. Without the Rule, the Commission would be unable to fully
implement these statutory responsibilities.
There are nine national securities exchanges which are subject to
Rule 12d2-1. The burden of complying with the rule is not evenly
distributed among the exchanges, since there are many more securities
listed on the New York and American Stock Exchanges than on the other
exchanges.\2\ However, for purposes of this filing, it is assumed that
the number of responses is evenly divided among the exchanges. This
results in a total annual burden of 54 hours based on nine respondents
with 12 responses per year for a total of 108 responses requiring an
average of .5 hour per response.
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\2\ In fact, some exchanges do not file any trading suspension
reports in a given year.
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Based on information acquired in an informal survey of the
exchanges and the staff's experience in administering related rules,
the Commission staff estimates that the respondents' cost of compliance
with Rule 12d2-1 may range from less than $10 to $100 per response. The
staff has computed the average cost per response to be approximately
$15, representing one-half reporting hour. The estimated total annual
cost for complying with Rule 12d2-1 is about $1620, i.e., nine
exchanges filing 12 responses at $15.00 each.
[[Page 49364]]
Rule 12d2-2 and Form 25 were adopted in 1935 and 1952,
respectively, pursuant to Sections 12 and 23 of the Act. Rule 12d2-2
sets forth the conditions and procedures under which a security may be
delisted. Rule 12d2-2 also requires, under certain circumstances, that
the Exchange file with the Commission a Form 25 to delist the security.
Form 25 provides the Commission with the name of the security, the
effective date of the delisting, and the date and type of event causing
the delisting.
Delisting notices and applications for delisting serve a number of
purposes. First, the reports and notices required under paragraphs (a)
and (b) of Rule 12d2-2 (which do not require Commission action) inform
the Commission that a security previously traded on an exchange is no
longer traded. In addition, the applications for delisting required
under paragraphs (c) and (d) of the Rule (which require Commission
approval) provide the Commission with the information necessary for it
to determine that the delisting has been accomplished in accordance
with the rules of the exchange, and to verify that the delisting is
subject to any terms and conditions necessary for the protection of
investors. Further, delisting applications are available to members of
the public who may wish to comment or submit information to the
Commission regarding the applications. Without the Rule, the Commission
lacks the information necessary for it to fully meet these statutory
responsibilities.
There are nine national securities exchanges which are subject to
Rule 12d2-2 and Form 25. The burden of complying with the Rule and Form
is not evenly distributed among the exchanges, since there are many
more securities listed on the New York and American Stock Exchanges
than on the other exchanges. However, for purposes of this filing, the
staff has assumed that the number of responses is evenly divided among
the exchanges. This results in a total annual burden of 450 hours based
on nine respondents with 50 responses per year for a total of 450
responses requiring an average of one hour per response.
Based on information acquired in an informal survey of the
exchanges and the staff's experience in administering related rules,
the Commission staff estimates that the cost of compliance with Rule
12d2-2 and Form 25 may range from less than $10 to $200 per response.
The staff has computed the average cost per response to be
approximately $30, representing one reporting hour per response. The
estimated total annual cost for complying with Rule 12d2-2 is about
$13,500, i.e., nine exchanges filing 50 responses at $30.00 each.
On July 14, 1976, the Commission adopted Rule 15Ba2-5 under the Act
to permit a duly-appointed fiduciary to assume immediate responsibility
for the operation of a municipal securities dealer's business. Without
the rule, the fiduciary would not be able to assume operation until it
registered as a municipal securities dealer. Under the rule, the
registration of a municipal securities dealer is deemed to be the
registration of any executor, guardian, conservator, assignee for the
benefit of creditors, receiver, trustee in insolvency or bankruptcy, or
other fiduciary appointed or qualified by order, judgment, or decree of
a court of competent jurisdiction to continue the business of such
municipal securities dealer, provided that the fiduciary files with the
Commission, within 30 days after entering upon the performance of its
duties, a statement setting forth substantially the same information
required by Form MSD or Form BD. That statement is necessary to ensure
that the Commission and the public have adequate information about the
fiduciary.
There is approximately 1 respondent per year that requires an
aggregate total of 4 hours to comply with this rule. This respondent
makes an estimated 1 annual response. Each response takes approximately
4 hours to complete. Thus, the total compliance burden per year is 4
burden hours. The approximate cost per hour is $20, resulting in a
total cost of compliance for the respondent of $80 (4 hours @ $20).
Rule 15c3-1 requires broker-dealers to, in essence, maintain
minimum levels of net capital computed in accordance with the rule's
provisions. Various provisions of Rule 15c3-1 require brokers and
dealers to notify the Commission and/or its Designated Examining
Authority (``DEA'') in certain situations. For example, a broker-dealer
carrying the account of an options market-maker must file a notice with
the Commission and the DEA of both the carrying firm and the market-
maker. In addition, the carrying firm must notify the Commission and
the appropriate DEA if a market-maker fails to deposit any required
equity with the carrying broker or dealer relating to his market-maker
account within the prescribed time period or if certain deductions and
other amounts relating to the carrying firm's market-maker accounts
computed in accordance with the rule's provisions exceeds 1000% of the
carrying broker's or dealer's net capital.
Moreover, Appendix C to the rule requires brokers and dealers,
under certain circumstances, to submit to their DEA an opinion of
counsel stating, in essence, that the broker or dealer may cause that
portion of the net assets of a subsidiary or affiliate related to its
ownership interest in the entity to be distributed to the broker or
dealer within 30 calendar days.
It is anticipated that approximately 1,150 broker-dealers will each
spend 1 hour per year complying with Rule 15c3-1. The total cost is
estimated to be approximately 1,150 hours. With respect to those
broker-dealers that must give notice under the rule, the cost is
approximately $20 per response for a total annual expense for all
broker-dealers of $23,000.
All brokers and dealers are required, pursuant to Rule 17a-10, to
file with the Commission an annual report of revenue and expenses. The
primary purpose of the rule is to obtain the economic and statistical
data necessary for an ongoing analysis of the securities industry.
Rule 17a-10 required brokers and dealers to provide their revenue
and expense data on a special form. The rule was amended in 1987 to
eliminate the form and reduce the amount of paperwork required of
brokers and dealers. The data previously reported on the form is now
obtained by the Commission staff from the quarterly balance sheet and
Statement of Income (Loss) which are filed with Form X-17A-5 (SEC File
No. 270-155; OMB No. 3235-0123), and from the three supplementary
schedules to Form X-17A-5, which are filed at the close of each
calendar year.
It is anticipated that approximately 7,000 broker-dealers will each
spend 1 hour per year complying with Rule 17a-10. The total cost is
estimated to be approximately 7,000 hours. Each broker-dealer will
spend approximately $10 per response for a total annual expense for all
broker-dealers of $70,000.
General comments regarding the estimated burden hours should be
directed to the Desk Officer for the Securities and Exchange Commission
at the address below. Any comments concerning the accuracy of the
estimated average burden hours for compliance with Commission rules and
forms should be directed to Michael E. Bartell, Associate Executive
Director, Office of Information Technology, Securities and Exchange
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 and Desk
Officer for the Securities and Exchange Commission, Office of
Information and Regulatory Affairs, Office of Management and
[[Page 49365]]
Budget, Room 3208, New Executive Office Building, Washington, D.C.
20503.
Dated: September 10, 1996.
Jonathan G. Katz,
Secretary.
[FR Doc. 96-23979 Filed 9-17-96; 8:45 am]
BILLING CODE 8010-01-M
