[Federal Register Volume 60, Number 245 (Thursday, December 21, 1995)]
[Notices]
[Pages 66333-66334]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31088]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36592; File No. SR-PSE-95-29]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the Pacific Stock Exchange, Inc. Relating to the Composition 
and Duties of the Options Allocation Committee of the Exchange

December 14, 1995.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on November 15, 1995, the 
Pacific Stock Exchange Incorporated (``PSE'' 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 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) (1988).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The PSE proposes to amend the rules relating to the composition and 
duties of its Options Allocation Committee (``OAC'').

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 IV 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

    The Exchange proposes to make five changes to PSE Rule 11.10(c). 
First, the Rule currently provides in part that the OAC shall consist 
of Floor Brokers and Market Makers. The Exchange proposes to amend this 
provision to provide that the OAC shall consist of Market Makers, Lead 
Market Makers, Floor Brokers, and/or persons associated with floor 
members, office members or office allied members.\2\

    \2\ Cf. PSE Const., Art. IV, Sec. 5(a) (similar provision for 
Equity Allocation Committee).
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    Second, Commentary .01 to Rule 11.10(c) currently provides that the 
OAC shall be comprised of (i) two Floor Brokers from either the Options 
Floor Trading Committee or the Options Listing Committee; (ii) two 
Market Makers or Lead Market Makers from either the Options Floor 
Trading Committee or the Options Listing Committee; (iii) three at-
large Floor Brokers; and (iv) three at-large Market Makers or Lead 
Market Makers. The Exchange proposes to amend this provisions to 
provide that attempts shall be made in order for the OAC to have a 
composition that includes: Floor Brokers from either the Options Floor 
Trading Committee or the Options Listing Committee; Market Makers or 
Lead Market Makers from either the Options Floor Trading Committee or 
the Options Listing Committee; at-large Floor Brokers; and at-large 
Market Makers or Lead Market Makers.
    Third, the Exchange proposes to eliminate the provision in 
Commentary .01 that the OAC shall be limited to no more than three 
members of the Options Floor Trading Committee and no more than three 
members of the Options Listing Committee.
    Fourth, Rule 11.10(c) currently provides that it shall be the duty 
of the OAC to allocate, reallocate and evaluate options issues. The 
Exchange proposes to change this provision to provide that the OAC 
shall allocate and reallocate option issues.
    Finally, Rule 11.10(c) currently provides that the OAC shall be 
responsible for monitoring the performances of trading crowds and Lead 
Market Makers. The Exchange proposes to change this provision to 
provide that the OAC shall be responsible for evaluating and monitoring 
the performances of Market Makers, trading crowds and Lead Market 
Makers.\3\

    \3\ The OAC currently evaluates Market Makers and Lead Market 
Makers pursuant to Options Floor Procedure Advice B-13.
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    The Exchange believes that the current rules on the composition of 
the OAC are unnecessarily restrictive and that the proposed changes to 
these rules are appropriate in order to allow for greater flexibility 
in the committee selection process and the process for replacing 
committee members who resign or change their status in regard to floor 
membership or service on other committees of the Exchange. With regard 
to the proposed changes to the rules on the duties of the OAC, the 
Exchange believes that they clarify the existing rules and do not 
otherwise change the way business is conducted on the Exchange.
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act, in general, and Section 6(b)(5), in particular, in 
that it promotes just and equitable principles of trade, and Section 
6(b)(4), in particular, in that it assures a fair representation of 
members in the administration of the affairs of the Exchange.

(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 that is not necessary or appropriate 
in furtherance of the purposes of the Act.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants, or Others

    Written comments on the proposed rule change were neither solicited 
nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organizations consents, the Commission will:
    (a) by order approve such proposed rule change, or
    (b) institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. 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 

[[Page 66334]]
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 in the Commission's Public Reference Section, 450 Fifth Street, 
NW., Washington, DC. Copies of such filing will also be available for 
inspection and copying at the principal office of the above-mentioned 
self-regulatory organization. All submissions should refer to File No. 
SR-PSE-95-29 and should be submitted by January 11, 1996.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\4\

    \4\ 17 CFR 200.20-3(a)(12) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-31088 Filed 12-20-95; 8:45 am]
BILLING CODE 8010-01-M