[Federal Register Volume 62, Number 127 (Wednesday, July 2, 1997)]
[Notices]
[Pages 35861-35862]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17318]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38778; File No. SR-BSE-97-01]
Self-Regulatory Organizations; Boston Stock Exchange; Order
Approving Proposed Rule Change Amending the Minor Rule Violation Plan
June 26, 1997.
I. Introduction
On May 13, 1997, the Boston Stock Exchange, Inc., (``BSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'' or ``SEC'') pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4
thereunder\2\ a proposed rule change relating to amendments to the
Minor Rule Violation Plan. The proposed rule change was published for
comment in Securities Exchange Act Release No. 38656 (May 20, 1997), 62
FR 28913 (May 28, 1997). The Commission received no comments on the
proposal.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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II. Description of the Proposal
BSE is amending its Minor Rule Violation Plan to add or increase
summary fine provisions for carrying weapons, fighting on the Exchange
premises, and failure to comply with Floor Official rulings.
The Exchange first proposes to increase the summary fine for
possession of a firearm or other weapon on the Exchange premises from
$2500 for any offense to $5000 for any offense.
The Exchange seeks to add a summary fine provision for unauthorized
physical contact with the intent to cause harm or intimidate another on
the Exchange premises, with summary fines of $500 for the first
offense, $1000 for the second offense, and $2500 for subsequent
offenses. The corresponding rule provision is Article XIV, Section 5 of
the Exchange Constitution.
The Exchange also seeks to add a summary fine provision for failure
to comply with an appealed Floor Official ruling that stands.\3\
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\3\ On June 18, 1997, the Exchange filed SR-BSE-97-03 seeking to
amend the corresponding rule provision relating to Floor Officials.
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Finally, the Exchange seeks to amend the rule provision regarding
appeals to summary fines to require filing with the Office of the
General Counsel, rather than with the Surveillance Department, in an
effort to provide a more efficient coordination of the appeal process.
The Exchange believes that the proposal is consistent with Section
[[Page 35862]]
6(b)(5) of the Act,\4\ in that it is designed to promote just and
equitable principles of trade, to foster cooperation and coordination
with persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and in general, to
protect investors and the public interest; and is not designed to
permit unfair discrimination between customer, issuers, brokers, or
dealers.
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\4\ 15 U.S.C. 78f(b)(5).
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III. Discussion
The Commission believes BSE's proposed rule change is consistent
with section 6(b)(5) of the Act.\5\ Section 6(b)(5) requires, among
other things, that the rules of an exchange be designed to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to perfect the mechanism of a free and open national
market system, and, in general, to further investor protection and the
public interest.\6\
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\5\ 15 U.S.C. 78f(b)(5).
\6\ In approving this rule, the Commission notes that it has
considered the proposed rule's impact on efficiency, competition,
and capital formation. 15 U.S.C. 78c(f).
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BSE is proposing to increase the fines for possession of a firearm
or other weapon on the Exchange premises. The Commission believes that
implementing such fines should serve as an effective deterrent against
possessing weapons on the Exchange premises, thereby ensuring the
safety of Exchange members, staff and guests. Similarly, the Commission
believes the addition of a summary fine provision for unauthorized
physical contact on the Exchange premises is appropriate as it should
deter such contacts and prevent member disputes from escalating to a
physical confrontation, again ensuring the safety of those present on
the Exchange floor.
The Commission believes the addition of a summary fine provision
for failure to comply with an appealed Floor Official ruling that
stands, is appropriate as it will ensure that rule interpretations and
execution quality issues on which Floor Officials are asked to making
rulings are addressed in a timely manner for the benefit of the
customer.
Finally, the Commission believes an amendment requiring that
appeals to summary fines be filed with the Office of the General
Counsel is appropriate as it will provide more efficient coordination
of the appeal process, thereby furthering investor protection and the
public interest.
IV. Conclusion
For the foregoing reasons, the Commission finds that the proposed
rule change is consistent with the Act and the rules and regulations
thereunder applicable to the BSE, and in particular Section 6(b)(5).
It is therefore Ordered, pursuant to Section 19(b)(2) of the
Act,\7\ that the proposed rule change (File No. SR-BSE-97-01) be and
hereby is approved.
\7\ 15 U.S.C. 78s(b)(2)
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For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-17318 Filed 7-1-97; 8:45 am]
BILLING CODE 8010-01-M