[Federal Register Volume 61, Number 173 (Thursday, September 5, 1996)]
[Notices]
[Pages 46884-46885]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-22629]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37621; File No. SR-CBOE-96-49]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by Chicago Board Options Exchange, Incorporated Relating to 
Permitting Additional Submissions Following Respondent's Petition for 
Review

August 29, 1996.
    On July 23, 1996, the Chicago Board Options Exchange, Incorporated 
(``CBOE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``SEC'' or ``Commission'') the proposed rule change 
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder.\2\ The proposed rule change 
amends Exchange Fule 17.10 which governs the review of Business Conduct 
Committee (``BCC'') decisions by the Exchange's Board of Directors 
(``Board''). Notice of the proposed rule change, together with the 
substance of the proposal, was issued by Commission release (Securities 
Exchange Act Release No. 37473, July 23, 1996) and by publication in 
the Federal Register (61 FR 39685, July 30, 1996).\3\ No comment 
letters were received. The Commission is approving the proposed rule 
change.
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    \1\ 15 U.S.C. Sec. 78s(b)(1) (1988).
    \2\ 17 CFR 240.19b-4.
    \3\ The proposed rule change was originally filed with the 
Commission on July 11, 1996. The CBOE subsequently submitted 
Amendment No. 1 to the filing. Letter from Michael L. Meyer, Schiff, 
Hardin & Waite, to Katherine England, Assistant Director, Division 
of Market Regulation, SEC, dated July 19, 1996.
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I. Background

    The purpose of the proposed change to Exchange Rule 17.10 is to 
formalize the current practice whereby the Board has permitted one 
additional submission by both Exchange staff and Respondent following 
Respondent's petition for review. Presently, the Rule does not provide 
for any subsequent submissions following a Respondent's appeal of a BCC 
decision to the Board.

II. The Terms of Substance of the Proposed Rule Change

    The proposed rule change provides that, after a Respondent appeals 
a BCC decision to the Board, Exchange staff may submit a written 
response to which the Respondent may submit a reply. The proposed rule 
change requires the

[[Page 46885]]

Exchange staff's response to be filed within 15 days of the date the 
Respondent's request for review is filed with the Secretary of the 
Exchange and the Respondent's reply to be filed within 15 days of 
service of staff's response. In addition, the proposed rule change 
clarifies that the Respondent's petition for review and Respondent's 
reply should be filed with the Secretary of the Exchange and the 
Exchange's Office of Enforcement.

III. Discussion

    The Commission believes the proposed rule change is consistent with 
Section 6 of the Act, in general, and Section 6(b)(7) in particular in 
that it provides a fair procedure for the disciplining of members and 
persons associated with members. The Commission believes the proposed 
rule change will make the review process more fair and efficient by 
formalizing the current appeal practice to ensure that both parties 
have the opportunity to make an additional submission to the Board and 
by clarifying with which office of the Exchange the petition for review 
should be filed. The proposed rule change will ensure a more fair and 
thorough process because each party will have an opportunity to clarify 
its position to the Board on the specific issues of contention 
addressed in the petition for review. As is the case under the current 
rules, the proposed rule change will ensure that the Respondent 
ordinarily will have the opportunity to make the final submission to 
the Board. In addition, the proposed rule change will reduce the amount 
of time the Board spends on administrative matters by eliminating the 
need for the staff to request approval before the submission of each 
response.
    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that the proposed rule change, SR-CBOE-96-49 be, and hereby is, 
approved.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority, 17 CFR 200.30-3(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-22629 Filed 9-4-96; 8:45 am]
BILLING CODE 8010-01-M