[Federal Register Volume 61, Number 33 (Friday, February 16, 1996)]
[Notices]
[Pages 6279-6280]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-3577]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36831; File No. SR-NYSE-95-43]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the New York Stock Exchange, Inc., Relating to Amendments to 
Exchange Rules 27, 476(a)(11), and 477

February 12, 1996.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on January 5, 1996, the New 
York Stock Exchange, Inc. (``NYSE'' 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).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The proposed rule change consists of amendments to New York Stock 
Exchange (the ``Exchange'') Rules 27, 476(a)(11) and 477, which require 
persons under Exchange jurisdiction to comply with information requests 
from commodities markets and associations and foreign self-regulatory 
organizations and associations.

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
    The purpose of the proposed rule change is to require persons under 
Exchange jurisdiction to comply with information requests from 
commodities markets and associations and foreign self-regulatory 
organizations and associations.
    Currently, Rule 27 authorizes the Exchange to enter into 
information sharing agreements with domestic and foreign self-
regulatory organizations and associations, but does not provide for 
such agreements with commodities regulatory organizations such as 
contract markets and registered futures associations.
    Rule 476(a)(11) permits the Exchange to initiate a disciplinary 
proceeding against a member, member organization, allied member, 
approved person, registered or non-registered employee of a member 
organization or a person otherwise subject to the jurisdiction of the 
Exchange, for failure to furnish information to, or appear or testify 
before the Exchange or another domestic self-regulatory organization. 
The rule does not authorize the Exchange to initiate such a proceeding 
when someone under Exchange jurisdiction fails to cooperate with a 
commodities market or association or a foreign self-regulatory 
organization or association.
    Rule 477 permits the Exchange to require a member, member 
organization, allied member, approved person or registered or non-
registered employee of a member organization that is terminating his 
status as such to comply with a request to appear, testify, submit 
books, records, papers, or objects and to respond to written requests 
and attend hearings in the same manner and to the same extent as if 
such person had maintained his status, if, prior to such termination, 
or during the period of one year immediately following the receipt by 
the Exchange of written notice of the termination, the Exchange makes 
such a request in writing. The rule does not require the above parties 
to comply with such requests from commodities markets or associations 
or from foreign self-regulatory organizations or associations.
    The Exchange is proposing to amend Rule 27 to add domestic contract 
markets and futures associations to the list of entities with which the 
Exchange is authorized to enter into information sharing agreements. 
The extent to which those under the Exchange's jurisdiction would be 
required to cooperate would be predicated on the subject matter or 
scope of the relevant information sharing agreement. Rule 476(a)(11) 
would be amended to require that those under its jurisdiction cooperate 
with information requests from domestic commodities markets and 
associations and foreign self-regulatory organizations and associations 
as well as from 

[[Page 6280]]
domestic securities markets.\2\ Rule 477 would be amended to require 
compliance with information requests submitted by the organizations 
specified in Rule 476(a)(11).\3\

    \2\ NYSE Rule 476(a)(11) is part of NYSE's minor rule violation 
plan set forth in NYSE Rule 476A. See Securities Exchange Act 
Release No. 25862 (Jun. 28, 1988), 53 FR 25400 (Jul. 6, 1988) (order 
approving File No. SR-NYSE-4-284).
    \3\ The NYSE has stated that, in connection with Rules 27, 
476(a)(11), and 477, it is its policy to afford NYSE members the 
same rights and procedural protections that such person or entities 
would have if the Exchange had initiated the request for information 
or testimony. In furtherance of this, the Exchange will always act 
as an intermediary between another SRO, a contract market or a 
registered futures association and the exchange member, member 
organization, or other designated person under Rule 476(a)(11) from 
whom information or testimony is being sought for any inquiry made 
pursuant to an agreement under Rule 27. Telephone conversation on 
February 2, 1996 between Donald Siemer, Director, Market 
Surveillance, NYSE and George A. Villasana, Attorney, Division of 
Market Regulation, SEC.
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    The Exchange believes that it is appropriate to expand the scope of 
its disciplinary proceedings to include a failure to cooperate with 
contract markets, futures associations and foreign self-regulatory 
organizations and associations because of its continued commitment to 
the enhancement of its regulatory efforts and the regulatory efforts of 
other market centers with which the Exchange has agreed to share 
information.
2. Statutory Basis
    The basis under the Act for the proposed rule change is the 
requirement under Section 6(b)(5) that an Exchange have rules that are 
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.\4\ The 
proposed amendments are consistent with these objectives in that they 
enhance the regulatory efforts of the Exchange and of other domestic 
and foreign securities markets.

    \4\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The NYSE does not believe that the proposed rule change will impose 
any inappropriate burden on competition.

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

    No written comments were either solicited or received.

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 it 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 NW., 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 NW., 
Washington, D.C. 20549. Copies of such filing will also be available 
for inspection and copying at the principal office of the Exchange. All 
submissions should refer to File No. SR-NYSE-95-43 and should be 
submitted by March 8, 1996.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-3577 Filed 2-15-96; 8:45 am]
BILLING CODE 8010-01-M