[Federal Register Volume 60, Number 129 (Thursday, July 6, 1995)]
[Notices]
[Pages 35247-35248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16478]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35913; File No. SR-Amex-95-22]


Self-Regulatory Organizations; Notice of Filing and Order 
Granting Accelerated Approval of Proposed Rule Change by the American 
Stock Exchange, Inc. Relating to the Entry of Market-at-the-Close 
Orders Through AMOS

June 28, 1995.
    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 June 5, 1995, 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 and 
II 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.

    \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 Amex proposes to amend Exchange Rule 109, Commentary .02, to 
correct an error in SR-Amex-95-09 \3\ regarding entry of market-at-the-
close (``MOC'') orders \4\ through the Post Execution Reporting 
(``PER'') or Amex Options Switching (``AMOS'') systems.\5\ The text of 
the proposed rule change is as follows:

    \3\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60 
FR 22592.
    \4\ A market-at-the-close order is a market order that is to be 
executed at or as near to the close as practicable. See American 
Stock Exchange Guide, Rule 131(e), (CCH) para. 9281.
    \5\ The PER system provides member firms with the means to 
electronically transmit equity orders, up to volume limits specified 
by the Exchange, directly to the specialist's post on the trading 
floor of the Exchange. Securities Exchange Act Release No. 33486 
(Jan. 18, 1994), 59 FR 54016. Similarly, the AMOS system is a 
computerized order routing system that provides member firms with 
the means to electronically transmit option orders directly to the 
trading floor of the Exchange. Securities Exchange Act Release No. 
34869 (Oct. 20, 1994), 59 FR 4293.
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[new text is italicized; deleted text is bracketed]:

Rule 109
* * * * *
Commentary
* * * * *
    .02 Members entering market-at-the-close orders through the PER [or 
AMOS] system[s] must do so no later than 3:50 p.m. The foregoing shall 
not limit or restrict the entry of market-at-the-close orders (or their 
cancellation) other than via such system[s].

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 III 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
    The Commission recently approved an amendment to Exchange Rule 109, 
Commentary .02, that imposed a 3:50 p.m. deadline for the entry, 
cancellation, or reduction of MOC orders through the PER or AMOS 
systems.\6\ The Exchange, however, did not intend to apply the 3:50 
p.m. deadline to options orders and, therefore, the reference to the 
AMOS system in its rule filing was incorrect. The disruptions that have 
resulted from MOC equity orders entered through PER have not been a 
concern with respect to option orders entered through AMOS. Therefore, 
the restriction on MOC orders in options is unnecessary. Although there 
are very few MOC option orders entered through AMOS, the 3:50 p.m. 
deadline is inconvenient to both member organizations and to the 
Exchange. Moreover, no other options exchange imposes such a 
restriction.

    \6\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60 
FR 22592.
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2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \7\ of the 
Act in general and furthers the objectives of Section 6(b)(5) \8\ in 
particular in that it is designed to promote just and equitable 
principles of trade, to remove impediments to, and perfect the 
mechanism of a free and open market and, in general, to protect 
investors and the public interest.

    \7\ 15 U.S.C. 78f.
    \8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes the proposed rule change will impose no 
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. 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, DC 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. Sec. 552, will be available for inspection and copying at 
the Commission's Public Reference Section, 450 Fifth Street NW., 
Washington, DC 20549. Copies of such filing will also be available for 
inspection and copying at the principal office of the American Stock 
Exchange. All submissions should refer to File No. SR-Amex-95-22 and 
should be submitted by July 27, 1995.

IV. Commission's Findings and Order Granting Accelerated Approval of 
Proposed Rule Change

    The Commission has reviewed carefully the Amex's proposed rule 
change and believes, for the reasons set forth below, the proposal is 
consistent with the requirements of Section 6 of 

[[Page 35248]]
the Act \9\ and the rules and regulations thereunder applicable to a 
national securities exchange. Specifically, the Commission believes the 
proposal is consistent with Section 6(b)(5) of the Act \10\ because it 
will facilitate transactions in securities by allowing for the timely 
transmission of MOC orders in options to the Amex floor, promote just 
and equitable principles of trade, remove impediments to, and perfect 
the mechanism of a free and open market.

    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(5).
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    The Commission finds good cause for approving the proposed rule 
change prior to the thirtieth day after the date of publication of 
notice thereof in the Federal Register. The Commission notes that prior 
to the erroneous reference to the AMOS system in SR-Amex-95-09,\11\ 
member firms were able to enter MOC orders in options after 3:50 p.m. 
via the AMOS system. Since the approval of that filing, however, the 
Amex's members have been unable to enter such orders. The Exchange has 
represented that the implementation of this restriction was a mistake 
on their part, is unnecessary, and is inconvenient to both the Exchange 
and its members. Based upon this and the Exchange's further 
representation that the removal of this deadline would simply reinstate 
the ability of member firms to enter MOC orders in options after 3:50 
p.m., the Commission deems it appropriate to approve the proposed rule 
change on an accelerated basis. The Commission believes, therefore, 
that granting accelerated approval of the proposed rule change is 
appropriate and consistent with Section 6 of the Act.\12\

    \11\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60 
FR 22592.
    \12\ 15 U.S.C. 78f.
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\13\ that the proposed rule change is hereby approved on an 
accelerated basis.

    \13\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\

    \14\ 17 CFR 200.30-3(a)(12).
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Margaret M. McFarland,
Deputy Secretary.
[FR Doc. 95-16478 Filed 7-5-95; 8:45 am]
BILLING CODE 8010-01-M