[Federal Register Volume 61, Number 141 (Monday, July 22, 1996)]
[Notices]
[Pages 37943-37945]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18458]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

    Upon Written Request, Copies Available From: Securities and 
Exchange Commission, Office of Filings and Information Services, 
Washington, DC 20549.
    Extension:

Rule 12d2-1--SEC File No. 270-98; OMB Control No. 3235-0081
Rule 12d2-2 and Form 25--SEC File No. 270-86; OMB Control No. 3235-0080
Rule 15Ba2-5--SEC File No. 270-91; OMB Control No. 3235-0088
Rule 15c3-1--SEC File No. 270-197; OMB Control No. 3235-0200
Rule 17a-10--SEC File No. 270-154; OMB Control No. 3235-0122

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') is publishing the following summaries of 
collections for public comment.
    Rule 12d2-1 was adopted in 1935 pursuant to Sections 12 and 23 of 
the Securities Exchange Act of 1934 (the ``Act''). The Rule provides 
the procedures by which a national securities exchange may suspend from 
trading a security that is listed and registered on the exchange. Under 
Rule 12d2-1, an exchange is permitted to suspend from trading a listed 
security in accordance with its rules, and must promptly notify the 
Commission of any such suspension, along with the effective date and 
the reasons for the suspension.
    Any such suspension may be continued until such time as the 
Commission may determine that the suspension is designed to evade the 
provisions of Section 12(d) of the Act and Rule 12d2-1 thereunder.\1\ 
During the continuance of such suspension under Rule 12d2-1, the 
exchange is required to notify the Commission promptly of any change in 
the reasons for the suspension. Upon the restoration to trading of any 
security suspended under the Rule, the exchange must notify the 
Commission promptly of the effective date of such restoration.
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    \1\ Rule 12d2-2 prescribes the circumstances under which a 
security may be delisted, and provides the procedures for taking 
such action.
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    The trading suspension notices serve a number of purposes. First, 
they inform the Commission that an exchange has suspended from trading 
a listed security or reintroduced trading in a previously suspended 
security. They also provide the Commission with information necessary 
for it to determine that the suspension has been accomplished in 
accordance with the rules of the exchange, and to verify that the 
exchange has not evaded the requirements of Section 12(d) of the Act 
and Rule 12d2-2 thereunder by improperly employing a trading 
suspension. Without the Rule, the Commission would be unable to fully 
implement these statutory responsibilities.
    There are nine national securities exchanges which are subject to 
Rule 12d2-1. The burden of complying with the rule is not evenly 
distributed among the exchanges, since there are many more securities 
listed on the New York and American Stock Exchanges than on the other 
exchanges.\2\ However, for purposes of this filing, it is assumed that 
the number of responses is evenly divided among the exchanges. This 
results in a total annual burden of 54 hours based on nine respondents 
with 12 responses per year for a total of 108 responses requiring an 
average of .5 hour per response.
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    \2\ In fact, some exchanges do not file any trading suspension 
reports in a given year.
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    Based on information acquired in an informal survey of the 
exchanges and the staff's experience in administering related rules, 
the Commission staff estimates that the respondents' cost of compliance 
with Rule 12d2-1 may range from less than $10 to $100 per response. The 
staff has computed the average cost per response to be approximately 
$15, representing one-half reporting hour. The estimated total annual 
cost for complying with Rule 12d2-1 is about $1620, i.e., nine 
exchanges filing 12 responses at $15.00 each.
    Rule 12d2-2 and Form 25 were adopted in 1935 and 1952, 
respectively, pursuant to Sections 12 and 23 of the

[[Page 37944]]

Act. Rule 12d2-2 sets forth the conditions and procedures under which a 
security may be delisted. Rule 12d2-2 also requires, under certain 
circumstances, that the Exchange file with the Commission a Form 25 to 
delist the security. Form 25 provides the Commission with the name of 
the security, the effective date of the delisting, and the date and 
type of event causing the delisting.
    Delisting notices and applications for delisting serve a number of 
purposes. First, the reports and notices required under paragraphs (a) 
and (b) of Rule 12d2-2 (which do not require Commission action) inform 
the Commission that a security previously traded on an exchange is no 
longer traded. In addition, the applications for delisting required 
under paragraphs (c) and (d) of the Rule (which require Commission 
approval) provide the Commission with the information necessary for it 
to determine that the delisting has been accomplished in accordance 
with the rules of the exchange, and to verify that the delisting is 
subject to any terms and conditions necessary for the protection of 
investors. Further, delisting applications are available to members of 
the public who may wish to comment or submit information to the 
Commission regarding the applications. Without the Rule, the Commission 
lacks the information necessary for it to fully meet these statutory 
responsibilities.
    There are nine national securities exchanges which are subject to 
Rule 12d2-2 and Form 25. The burden of complying with the Rule and Form 
is not evenly distributed among the exchanges, since there are many 
more securities listed on the New York and American Stock Exchanges 
than on the other exchanges. However, for purposes of this filing, the 
staff has assumed that the number of responses is evenly divided among 
the exchanges. This results in a total annual burden of 450 hours based 
on nine respondents with 50 responses per year for a total of 450 
responses requiring an average of one hour per response.
    Based on information acquired in an informal survey of the 
exchanges and the staff's experience in administering related rules, 
the Commission staff estimates that the cost of compliance with Rule 
12d2-2 and Form 25 may range from less than $10 to $200 per response. 
The staff has computed the average cost per response to be 
approximately $30, representing one reporting hour per response. The 
estimated total annual cost for complying with Rule 12d2-2 is about 
$13,500, i.e., nine exchanges filing 50 responses at $30.00 each.
    On July 14, 1976, the Commission adopted Rule 15Ba2-5 under the Act 
to permit a duly-appointed fiduciary to assume immediate responsibility 
for the operation of a municipal securities dealer's business. Without 
the rule, the fiduciary would not be able to assume operation until it 
registered as a municipal securities dealer. Under the rule, the 
registration of a municipal securities dealer is deemed to be the 
registration of any executor, guardian, conservator, assignee for the 
benefit of creditors, receiver, trustee in insolvency or bankruptcy, or 
other fiduciary appointed or qualified by order, judgment, or decree of 
a court of competent jurisdiction to contain the business of such 
municipal securities dealer, provided that the fiduciary files with the 
Commission, within 30 days after entering upon the performance of its 
duties, a statement setting forth substantially the same information 
required by Form MSD or Form BD. That statement is necessary to ensure 
that the Commission and the public have adequate information about the 
fiduciary.
    There is approximately 1 respondent per year that requires an 
aggregate total of 4 hours to comply with this rule. This respondent 
makes an estimated 1 annual response. Each response takes approximately 
4 hours to complete. Thus, the total compliance burden per year is 4 
burden hours. The approximate cost per hours is $20, resulting in a 
total cost of compliance for the respondent of $80 (4 hours @ $20).
    Rule 15c3-1 requires broker-dealers to, in essence, maintain 
minimum levels of net capital computed in accordance with the rule's 
provisions. Various provisions of Rule 15c3-1 require brokers and 
dealers to notify the Commission and/or its Designated Examining 
Authority (``DEA'') in certain situations. For example, a broker-dealer 
carrying the account of an options market-maker must file a notice with 
the Commission and the DEA of both the carrying firm and the market-
maker. In addition, the carrying firm must notify the Commission and 
the appropriate DEA if a market-maker fails to deposit any required 
equity with the carrying broker or dealer relating to his market-maker 
account within the prescribed time period or if certain deductions and 
other amounts relating to the carrying firm's market-maker accounts 
computed in accordance with the rule's provisions exceeds 1000% of the 
carrying broker's or dealer's net capital.
    Moreover, Appendix C to the rule requires brokers and dealers, 
under certain circumstances, to submit to their DEA an opinion of 
counsel stating, in essence, that the broker or dealer may cause that 
portion of the net assets of a subsidiary or affiliate related to its 
ownership interest in the entity to be distributed to the broker or 
dealer within 30 calendar days.
    It is anticipated that approximately 1,150 broker-dealers will each 
spend 1 hour per year complying with Rule 15c3-1. The total cost is 
estimated to be approximately 1,150 hours. With respect to those 
broker-dealers that must give notice under the rule, the cost is 
approximately $20 per response for a total annual expense for all 
broker-dealers of $23,000.
    All brokers and dealers are required, pursuant to Rule 17a-10, to 
file with the Commission an annual report of revenue and expenses. The 
primary purpose of the rule is to obtain the economic and statistical 
data necessary for an ongoing analysis of the securities industry.
    Rule 17a-10 required brokers and dealers to provide their revenue 
and expense data on a special form. The rule was amended in 1987 to 
eliminate the form and reduce the amount of paperwork required of 
brokers and dealers. The data previously reported on the form is now 
obtained by the Commission staff from the quarterly balance sheet and 
Statement of Income (Loss) which are filed with Form X-17A-5 (SEC File 
No. 270-155; OMB No. 3235-0123), and from the three supplementary 
schedules to Form X-17A-5, which are filed at the close of each 
calendar year.
    It is anticipated that approximately 2,600 broker-dealers will each 
spend 1 hour per year complying with Rule 17a-10. The total cost is 
estimated to be approximately 2,600 hours. Each broker-dealer will 
spend approximately $10 per response for a total annual expense for all 
broker-dealers of $26,000.
    Written comments are invited on: (a) Whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the agency, including whether the information shall 
have practical utility; (b) the accuracy of the agency's estimate of 
the burden of the proposed collection of information; (c) ways to 
enhance the quality, utility, and clarity of the information to be 
collected; and (d) ways to minimize the burden of the collection of 
information on respondents, including through the use of automated 
collection techniques or other forms of information technology. 
Consideration will be given to comments and suggestions submitted in

[[Page 37945]]

writing within 60 days of this publication.
    Direct your written comments to Michael E. Bartell, Associate 
Executive Director, Office of Information Technology, Securities and 
Exchange Commission, 450 5th Street, NW., Washington, DC 20549.

    Dated: July 3, 1996.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-18458 Filed 7-19-96; 8:45 am]
BILLING CODE 8010-01-M