[Federal Register Volume 62, Number 97 (Tuesday, May 20, 1997)]
[Notices]
[Pages 27641-27642]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-13096]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-38620; File No. SR-PCX-97-13]


Self-Regulatory Organizations; The Pacific Exchange, Inc.; Notice 
of Filing of Proposed Rule Change Relating to the Use of the Internet 
or Similar Electronic Networks for Providing Market Quotations or 
Advertising to the General Public

May 13, 1997.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on April 23, 1997, The 
Pacific Exchange, Inc. (``PCX'' 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 primarily by PCX. 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) (1988).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is proposing to amend PCX Rule 9.24 to require its 
Members and Member Organizations for which it is the designated 
examining authority (``DEA''), to obtain the consent of the Exchange 
prior to making use of the internet or similar electronic networks for 
the purpose of providing market quotations or advertising to the 
general public.\2\
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    \2\ The text of the proposed rule change is attached as Exhibit 
A to File No. SR-PCX-97-13, and is available for review at the 
principal office of PCX and in the Public Reference Room of the 
Commission.
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, PCX 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. PCX 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

    PCX Rule 9.24, ``Radio, Television, Telephone Reports,'' currently 
provides that Member firms desiring to broadcast Exchange quotations on 
radio or television programs, or in public telephone market reports, or 
to make use of radio or television broadcasts for any business purpose, 
shall first obtain the consent of the Exchange by submitting an outline 
of the program. The rule further provides that the text of all 
commercials and program material (except lists of market quotations) 
about securities or investing sponsored by member firms on radio, 
television, or public telephone market reports, or program material 
supplied to these media shall be sent to the Exchange promptly 
following the program in which it is used.
    The Exchange is proposing to add three provisions to the text of 
Rule 9.24. The first provision provides that Members and Member 
organizations desiring to make use of the internet or similar 
electronic networks for the purpose of providing market quotations or 
advertising to the general public, must first obtain the consent of the 
Exchange by submitting an outline of the program to the Exchange.
    The second provision provides that the text of all commercials and 
program material (except lists of market quotations) about securities 
or investing sponsored by Member or Member Organizations on the 
internet, or similar electronic networks, or program material supplied 
to such media, must be sent to the Exchange promptly following the 
program in which it is used.
    Finally, the Exchange is proposing to clarify the limited scope of 
Rule 9.24 by stating expressly that it only applies to Members and 
Member Organizations for which the Exchange is the DEA.
    The Exchange believes that Rule 9.24 should be expanded given the 
increasing use of the internet and similar electronic networks in mass 
communications. Accordingly, the Exchange is proposing these amendments 
in order to preserve the essential purpose of Rule 9.24.
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act, and Section 6(b)(5) of the Act \3\ in particular, in 
that it promotes just and equitable principles of trade

[[Page 27642]]

and protects investors and the public interest.
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    \3\ 15 U.S.C. Sec. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
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

    Written comments on the proposed rule change were neither solicited 
nor received.

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

    Within thirty-five days of the date of publication of this notice 
in the Federal Register or within such longer period (i) As the 
Commission may designate up to ninety 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 PCX consents, the Commission will:
    (A) By order approve such 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, 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. Sec. 552, will be available for inspection and copying in 
the Commission's Public Reference Section, 450 Fifth Street NW., 
Washington, DC 20549. Copies of such filing will also be available for 
inspection and copying at the principal office of PCX. All submissions 
should refer to File No. SR-PCX-97-13 and should be submitted by July 
7, 1997.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\4\
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    \4\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-13096 Filed 5-19-97; 8:45 am]
BILLING CODE 8010-01-M