[Federal Register Volume 61, Number 46 (Thursday, March 7, 1996)]
[Notices]
[Pages 9215-9216]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5303]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36911; File No. SR-CHX-96-07]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Chicago Stock Exchange, 
Incorporated Relating to the Posting of Sales and Transfers of 
Memberships

February 29, 1996.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on February 7, 1996, the 
Chicago Stock Exchange, Incorporated (``CHX'' 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.
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    \1\ 15 U.S.C. 78s(b)(1).

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[[Page 9216]]

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Rule 5(c), Rule 12, Rule 13 and 
interpretation and policy .01 of Rule 10 of Article I of the Exchange's 
Rules, all of which relate, directly or indirectly, to the time period 
of posting proposed sales or transfers of memberships. The Exchange 
also proposes to amend Rule 6 of Article I. Among other matters, Rule 6 
provides a period during which an applicant for membership may file a 
written response to an objection to such applicant's election to 
membership.

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
    Currently, before an application for membership on the Exchange is 
approved, Rule 5(c) of Article I of the Exchange's Rules requires that 
the name of the applicant, the name of the member or member 
organization from which the membership is to be transferred and the 
sponsor's names must be posted on the bulletin board on the Floor of 
the Exchange for fifteen days and notice of posting mailed to all 
members. This fifteen day notice period, however, sometimes expires on 
a Saturday or Sunday. The purpose of the proposed rule change is to 
change this posting requirement to ten business days to ensure that the 
notice period expires on a day when the Exchange is open for business. 
Conforming changes are also being made to interpretation and policy .01 
of Rule 10, and Rules 12 and 13.\2\
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    \2\ Interpretation and policy .01 of Rule 10 provides that all 
contracts for the sale of a membership must remain in force during 
the fifteen day posting period. Rule 12 generally prohibits a 
transferring member or member organization from entering into any 
contract on the Exchange for settlement after the fifteen day 
posting period. Rule 13 generally requires all open Exchange 
contracts of a transferring member or member organization to mature 
on the full business day preceding the expiration of the fifteen day 
posting period. The proposed rule change would change the operative 
period in each of the above rules from fifteen days to ten business 
days.
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    Similarly, Rule 6 of Article I currently provides that during the 
posting period any member may file an objection to the election of the 
applicant to membership, that the applicant shall be sent a statement 
of reasons for such objection, and may file a written response within 
fifteen days of the receipt thereof. The proposed rule change would 
change the response period to ten business days.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the Act 
\3\ in general and furthers the objectives of Section 6(b)(5) \4\ of 
the Act in that it is designed to promote just and equitable principles 
of trade, to remove impediments and to perfect the mechanism of a free 
and open market and a national market system, and, in general, to 
protect investors and the public interest.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not 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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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

    Because the foregoing proposed rule change: (1) does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
(3) does not become operative for 30 days from February 7, 1996, the 
date on which it was filed, and the Exchange provided the Commission 
with written notice of its intent to file the proposed rule change at 
least five business days prior to the filing date, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(e)(6) thereunder.\5\
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    \5\ 17 CFR 240.19b-4(e)(6) (1994).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act.

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 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, DC 20549. Copies of such filing also will be available for 
inspection and copying at the principal office of The Chicago Stock 
Exchange, Incorporated. All submissions should refer to File No. SR-
CHX-96-07 and should be submitted by March 28, 1996.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 96-5303 Filed 3-6-96; 8:45 am]
BILLING CODE 8010-01-M