[Federal Register Volume 61, Number 164 (Thursday, August 22, 1996)]
[Notices]
[Pages 43393-43394]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-21371]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-37576; File No. SR-CHX-96-23]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by The Chicago Stock Exchange, 
Incorporated Relating to Limited Partnership Rollups, Depository 
Eligibility Requirements and Nasdaq/NM Securities

August 15, 1996.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on August 9, 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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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The CHX proposes to amend Rule 7(J), Article XXVIII of its rules, 
regarding the listing of securities related to limited partnership 
rollups and the depository eligibility requirement for issuers of 
domestic securities. The rule change also proposes to amend the 
following rules each relating to the trading of Nasdaq/NM Securities 
(i) Article XX, Rule 2, (ii) Article XX, Rule 37(a), interpretations 
and policies, .01, (iii) Article XX, Rule 43, (iv) Article XXVIII, Rule 
18(b), (v) Article XXX, Rule 1, interpretations and policies .02, .03, 
(vi) Article XXX, Rule 23, interpretations and policies .01, (vii) 
Article XXXI, Rule 5, interpretations and policies .01, and (viii) 
Article XXXI, Rule 9(b).

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

[[Page 43394]]

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
    On December 16, 1994, the Commission approved a proposed change to 
Exchange Rule 7, Article XXVIII relating to the listing of securities 
related to limited partnership rollups.\2\ One purpose of this proposal 
is to update a citation referred to in this limited partnership rollup 
transaction rule. Specifically, because the NASD has overhauled its 
rules and has adopted a new numbering system, the NASD rule cited in 
the Exchange's limited partnership rollup transaction rule, Section 34 
of Article III of the NASD's Rules of Fair Practice, should be replaced 
with its new cite, NASD Rule 2810.
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    \2\ Securities Exchange Act Release No. 35111 (Dec. 16, 1994), 
59 FR 66388 (Dec. 23, 1994) (order approving File No. SR-CHX-94-24).
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    On June 1, 1996, the Commission approved another proposed change to 
Rule 7, Article XXVIII of the Exchange's rules relating to the 
depository eligibility requirement for issuers who desire to list their 
securities on the Exchange.\3\
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    \3\ Securities Exchange Act Release No. 35798 (June 1, 1995), 60 
FR 30909 (June 12, 1995) (order approving File No. SR-CHX-95-12).
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    Another purpose of this proposed rule change is to renumber the 
limited partnership rollup rule as Rule 1(f) of Article XXVIII and the 
depository eligibility rule as Rule 1(g) of Article XXVIII. 
Specifically, because the Exchange has recently overhauled Article 
XXVIII in the process of creating Tier I and Tier II securities listing 
standards, the rules should be renumbered and placed appropriately 
within the new listing requirements.\4\
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    \4\ Securities Exchange Act Release No. 37481 (July 26, 1996), 
61 FR 40270 (Aug. 1, 1996) (order approving File No. SR-CHX-95-26).
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    Finally, in response to a Commission request,\5\ an additional 
purpose of the rule change is to update several of the citations in the 
Exchange's rule to NASDAQ/NMS Securities, with its new term Nasdaq/NM 
Securities. Because the Exchange currently has several proposed rule 
changes on file with the SEC relating to Nasdaq/NM Securities, the text 
of those rule filings should be deemed to be amended to reflect this 
new terminology.\6\
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    \5\ See, Securities Exchange Act Release Nos. 37327 (June 19, 
1995), 61 FR 32870 (June 25, 1996) (notice of File No. SR-CHX-96-
15), and 37369 (June 25, 1996), 61 FR 34462 (July 2, 1996) (notice 
of File No. SR-CHX-96-16).
    \6\ Id.
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2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the Act 
\7\ in general and furthers the objectives of Section 6(b)(5) \8\ in 
particular in that it is designed to prevent fraudulent and 
manipulative acts and practices and to perfect the mechanism of a free 
and open market.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed 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

    The foregoing rule change constitutes a stated policy, practice or 
interpretation with respect to the meaning, administration, or 
enforcement of an existing rule of the Exchange pursuant to Section 
19(b)(3)(A) of the Act and Rule 19b-4(e) thereunder.\9\
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    \9\ 17 CFR 240.19b-4(e).
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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. All submissions should refer to File No. SR-CHX-96-23 and 
should be submitted by September 12, 1996.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-21371 Filed 8-21-96; 8:45 am]
BILLING CODE 8010-01-M