[Federal Register Volume 60, Number 244 (Wednesday, December 20, 1995)]
[Notices]
[Page 65703]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-30909]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36588; File No. SR-CBOE-95-63]


Self-Regulatory Organizations; Order Granting Approval to 
Proposed Rule Change by the Chicago Board Options Exchange, Inc., 
Relating to Adoption of Rule 9.24 and an Interpretation With Respect to 
Proposed Rule 9.24

December 13, 1995.

I. Introduction

    On October 19, 1995, the Chicago Board Options Exchange, Inc. 
(``CBOE'' or ``Exchange'') submitted to the Securities and Exchange 
Commission (``Commission''), pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to adopt new Rule 9.24 and to add 
Interpretation and Policy .01 thereunder with respect to the meaning 
and administration of proposed Rule 9.24.

    \1\ 15 U.S.C. 78s(b)(1) (1988).
    \2\ 17 CFR 240.19b-4 (1994).
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    The proposed rule change appeared in the Federal Register on 
November 9, 1995.\3\ No comments were received on the proposed rule 
change. This order approves the CBOE's proposal.

    \3\ See Securities Exchange Act Release No. 36455 (November 3, 
1995), 60 FR 56624 (November 9, 1995).
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II. Description

    The proposed rule would require members and member organizations 
that engage in telephone solicitations to maintain a centralized list 
of persons who do not wish to receive telephone solicitations, and to 
refrain from making telephone solicitations to persons named on such 
list. The CBOE's proposal would also add an interpretation concerning 
the meaning and administration of proposed Rule 9.24 as well as serve 
as a reminder \4\ that members and member organizations are subject to 
compliance with the relevant Federal Communications Commission 
(``FCC'') and Commission rules relating to telemarketing practices.\5\

    \4\ The Commission notes that the CBOE intends to include this 
Interpretation in a Circular that will be distributed to members and 
member organizations.
    \5\ Pursuant to the Telephone Consumer Protection Act (1991), 
the FCC developed rules to protect the rights of telephone consumers 
while allowing legitimate telemarketing practices. The FCC rules 
include a requirement that a person or entity making telephone 
solicitations must maintain a do-not-call list. In addition, the 
Telemarketing and Consumer Fraud and Abuse Prevention Act (1994) 
(``Prevention Act''), requires the Federal Trade Commission 
(``FTC'') to adopt rules on abusive cold calling. The Prevention Act 
also requires the Commission to engage in its own rulemaking or, 
alternatively, to require the self-regulatory organizations to 
promulgate telemarketing rules consistent with the legislation.
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III. Discussion

    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange, and, in 
particular, with the requirements of Section 6(b).\6\ Specifically, the 
Commission believes that the proposal is consistent with the Section 
6(b)(5) requirement that the rules of an exchange be designed to 
prevent fraudulent and manipulative acts and practices. Proposed Rule 
9.24 and the interpretation thereunder require a specific practice, the 
maintenance of a do-not-call list. The purpose of maintaining such a 
list is to prevent members and member organizations from engaging in 
such manipulative acts as persistently calling investors who have 
expressed a desire not to receive telephone solicitations.

    \6\ 15 U.S.C. 78f(b) (1988).
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    The Commission also believes that the proposal is consistent with 
the Section 6(b)(5) requirement that the rules of an exchange be 
designed to protect investors and the public interest. Proposed Rule 
9.24 and the interpretation thereunder protect investors and the public 
interest by enforcing members' and member organizations' compliance 
with investors' desire not to receive such calls. In addition, the 
proposed interpretation reminds members and member organizations that 
they are subject to the requirements of the rules of the FCC and the 
Commission relating to telemarketing practices and the rights of 
telephone consumers.

IV. Conclusion

    For the foregoing reasons, the Commission finds that the CBOE's 
proposal to adopt a new rule concerning telephone solicitation and 
record-keeping is consistent with the requirements of the Act and the 
rules and regulations thereunder.
    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\7\ that the proposed rule change (SR-CBOE-95-63) is approved.

    \7\ 15 U.S.C. 78s(b)(2) (1988).
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    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\

    \8\ 17 CFR 200.30-3(a)(12) (1994).
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Jonathan G. Katz,
Secretary.
[FR Doc. 95-30909 Filed 12-19-95; 8:45 am]
BILLING CODE 8010-01-M