[Federal Register Volume 61, Number 22 (Thursday, February 1, 1996)]
[Notices]
[Pages 3747-3748]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-2058]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36775; File No. SR-Phlx-95-93]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Philadelphia Stock Exchange, Inc. To Increase the Number
of Appointed Public Governors to Four, To Limit Appointed Public
Governors to Two Consecutive Three-Year Terms, and To Eliminate From
the Board of Governors the Ex-Officio Position Presently Held by the
Immediate Past President of the Exchange
January 26, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on January 4, 1996, the
Philadelphia Stock Exchange, Inc. (``Phlx'' 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).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Phlx proposes to increase the number of Appointed Public
Governors from three to four and also proposes a two term limit on all
Appointed Public governors. Additionally, the Phlx proposes to
eliminate one of the ex-officio offices of the Board of Governors.
Finally, the Phlx proposes to delete the second paragraph of Article IV
section
[[Page 3748]]
4-3 because it no longer provides any constructive use.\2\
\2\ This paragraph currently provides that ``Notwithstanding the
provisions of By-Law 4-1 and the first paragraph of this by-law, the
classes whose terms expire in 1986, 1987 and 1988 shall remain as
currently constituted until their terms expire.'' It was included in
connection with the last amendment to this by-law to ensure a smooth
transition of the Governors whose terms were scheduled to expire in
1986, 1987, and 1988. Telephone conversation between Murray L. Ross,
Secretary, Phlx, and Anthony P. Pecora, Attorney, SEC (Jan. 22,
1996).
---------------------------------------------------------------------------
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
1. Purpose
Article IV of the Phlx By-Laws presently provides for three
Appointed Public Governors. These Governors presently serve three-year
terms and have no term limits. The Phlx proposes to increase the number
of Appointed Public Governors from three to four, while eliminating the
ex-officio position presently held by the immediate past President of
the Phlx.\3\
\3\ The Commission notes, according to the proposal, that the
fourth Appointed Public Governor's term would commence in 1996.
Hence, one Appointed Public Governor would be selected every year,
except in 1996 and every third year thereafter. In those years, two
Appointed Public Governors would be selected.
---------------------------------------------------------------------------
Additionally, the proposed amendment establishes term limits for
Appointed Public Governors of no more than two consecutive three year
terms (total of six consecutive years). The term limit provision makes
Appointed Public Governors ineligible for further service in such
capacity until an interval of at least one year passes.\4\ By imposing
term limits on the Appointed Public Governors, the Phlx hopes to
promote diversity amongst the Appointed Public Governors. The Exchange
believes this diversity will better serve the Exchange, its members,
its member organizations, and investors.
\4\ The Commission notes, in addition to the Appointed Public
Governors, that the Exchange's Board of Governors would be composed
of the offices of the Chairman of the Board, two Vice Chairmen of
the Board, 9 On-Floor Governors, 9 Off-Floor Governors, 2 At-Large
Governors, the President of the Exchange, and an ex-officio position
held by the immediate past Chairman of the Board. The Chairman may
serve in such office for two consecutive two-year terms, and the
Vice Chairman may serve in such office for four consecutive one-year
terms. After serving for such periods, these Governors are
ineligible for further service in such office until an interval of
at least one year passes. The immediate past Chairman may serve in
such office for a one-year term. The 9 On-Floor Governors, the 9
Off-Floor Governors, the 3 At-Large Governors, and the President of
the Exchange, however, are not subject to term limits. See Phlx By-
Laws, Article IV, Secs. 4-1 and 4-2.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
section 6(b)(3) of the Act \5\ because it provides in part that one or
more directors shall be representative of issuers and investors and not
associated with a member of the Exchange, broker, or dealer. The
Exchange also believes the proposed rule change furthers the objectives
of Section 6(b)(5)\6\ in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principals of trade, and, in general, to protect investors and the
public interest.
\5\ 15 U.S.C. 78f(b)(3).
\6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Competition
The Exchange believes the proposed rule change will impose no
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
The Exchange did not receive any written comments in response to
Phlx Circular 95-193.\7\
\7\ In accordance with Phlx By-Law Article XXII, Sec. 22-2, this
circular announced the current proposal to the Exchange's members.
---------------------------------------------------------------------------
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the publication of this notice in the Federal
Register or within such other period (i) as the Commission may
designate up to 90 days of such date if its finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) by order approve the 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, N.W., Washington, D.C. 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. 552, will be available for inspection and copying at the
Commission's Public Reference Section, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Also, copies of such filing will be available
for inspection and copying at the principal office of the Phlx. All
submissions should refer to File No. SR-Phlx-95-93 and should be
submitted by February 22, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\8\
\8\ 17 C.F.R. 200.30-3(a) (12).
---------------------------------------------------------------------------
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-2058 Filed 1-31-96; 8:45 am]
BILLING CODE 8010-01-M