[Federal Register Volume 60, Number 221 (Thursday, November 16, 1995)]
[Notices]
[Page 57611]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-28317]



-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36469; International Series Release No. 883; File No. 
SR-ODD-95-1]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Order Approving Supplement to Options Disclosure Document Regarding 
Customized Foreign Currency Options With Customized Expiration Dates

November 8, 1995.
    On October 26, 1995, the Options Clearing Corporation (``OCC''), on 
behalf of the Philadelphia Stock Exchange, Inc. (``PHLX'' or 
``Exchange''), submitted to the Securities and Exchange Commission 
(``Commission''), pursuant to Rule 9b-1 under the Securities Exchange 
Act of 1934 (``Act''),\1\ preliminary copies of a supplement 
(``Supplement'') to the Options Disclosure (``ODD'') which describes 
the special exercise and assignment procedures for foreign currency 
options with customized expiration dates (``Customized expiration date 
FCOs''). Five definitive copies of the Supplement were delivered to the 
Commission on November 7, 1995.\2\

    \1\ 17 CFR 240.9b-1 (1994).
    \2\ See letter from Jean M. Cawley, OCC, to Michael Walinskas, 
Branch Chief, Office of Market Supervision, Division of Market 
Regulation, Commission, dated November 7, 1995.
---------------------------------------------------------------------------

    The proposed Supplement to the ODD provides for disclosure of 
certain unique aspects of the Exchange's Customized expiration date FCO 
proposal, which has been submitted to the Commission separately.\3\ 
This Supplement, which is to be read in conjunction with the more 
general ODD entitled ``Characteristics and Ricks of Standardized 
Options,'' describes, among other things, the special exercise and 
assignment procedures for Customized expiration date FCOs. Pursuant to 
Rule 9b-1, the Supplement will have to be provided to investors in this 
product before their accounts are approved for transactions in 
Customized expiration date FCOs or their orders for Customized 
expiration date FCOs are accepted.

    \3\ See Securities Exchange Act Release No. 36131 (August 22, 
1995), 60 FR 44927 (August 29, 1995) (notice of File No. SR-PHLX-95-
52).
---------------------------------------------------------------------------

    The Commission has reviewed the ODD Supplement and finds that it 
complies with Rule 9b-1. The Supplement is intended to be read in 
conjunction with the ODD, which discloses the characteristics and risks 
of flexibly structured foreign currency options generally. The 
Supplement provides additional information regarding Customized 
expiration date FCOs sufficient to describe the special characteristics 
and risks of these products with respect to their exercise and 
assignment.
    Rule 9b-1 provides that an options market must file five copies of 
amendments to a disclosure document with the Commission at least 30 
days prior to the date definitive copies are furnished to customers, 
unless the Commission determines otherwise having due regard to the 
adequacy of the information disclosed and the protection of 
investors.\4\ The Commission believes that it is consistent with the 
public interest and the protection of investors to allow distribution 
of the Supplement as of November 8, 1995, a date which is within 30 
days of the date definitive copies of the Supplement were submitted to 
the Commission. Specifically, the Commission believes that, because the 
Supplement provides adequate disclosure of the special characteristics 
and risks of these products with respect to their exercise and 
assignment, thereby helping to ensure that customers engaging in 
Customized expiration date FCOs are cable of understanding the risks of 
such trading activity, it is consistent with the public interest for it 
to be distributed to investors before the planned commencement of, or 
simultaneously with, trading in Customized expiration date FCOs on the 
Exchange.

    \4\ This provision is intended to permit the Commission either 
to accelerate or to extend the time period in which definitive 
copies of a disclosure document may be distributed to the public.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Rule 9b-1 under the Act,\5\ 
that the proposed Supplement to the ODD (SR-ODD-95-1) to accommodate 
the Exchange's proposed trading of Customized expiration date FCOs is 
approved.

    \5\ 17 CFR 240.9b-1 (1994).
---------------------------------------------------------------------------

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\

    \6\ 17 CFR 200.30-3(a)(39) (1994).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-28317 Filed 11-15-95; 8:45 am]
BILLING CODE 5010-01-M