[Federal Register Volume 64, Number 4 (Thursday, January 7, 1999)]
[Notices]
[Pages 1043-1044]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-304]



[[Page 1043]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-40857; File No. SR-CHX-98-28]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Chicago Stock Exchange, 
Incorporated Relating to the Filing of Certain Material by Listed 
Companies in the EDGAR System

December 29, 1998.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on November 25, 1998, 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 CHX. 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 Exchange proposes to add Interpretation and Policy .01 to 
Exchange Rule 19 of Article XXVIII and Interpretation and Policy .04 to 
Exchange Rule 21 of Article XXVIII to permit listed companies to comply 
with their obligation to file certain reports and other materials with 
the Exchange by filing such material with the Commission through the 
Electronic Data Gathering, Analysis, and Retrieval (``EDGAR'') System.

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 CHX 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 CHX 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

1. Purpose
    The purpose of the proposed rule change is to streamline filing 
requirements for listed companies by permitting them to satisfy the 
requirement of filing certain CHX and Commission documents with the 
Exchange by filing such documents with the Commission in electronic 
format.
    The Exchange's rules require listed companies to file with the 
Exchange copies of annual and certain interim reports, as well as 
certain other filings required by the Commission, such as registration 
statements and prospectuses, depending on whether the company is listed 
pursuant to Tier I or Tier II of the Exchange's listing rules. The 
Commission also requires listed companies to file copies of reports and 
registration statements required by the Commission with any national 
securities exchange on which their securities are listed. Listed 
companies currently file these materials with the Exchange in paper 
format, even if they file electronically with the Commission. Under the 
Commission's regulations, domestic registrants generally are required 
to file all material with the Commission through EDGAR.\2\
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    \2\ 17 CFR 232.100.
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    The proposed rule change provides that, with one exception, the 
EDGAR filing will satisfy the Exchange filing requirement.\3\ The 
Exchange will have immediate and complete access to all filings through 
a contractual relationship with a commercial vendor which provides 
real-time access to the EDGAR system.\4\ The relevant Exchange staff 
also has access to much of this information through the Commission's 
EDGAR site on the World Wide Web.
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    \3\ Simultaneous with this filing, the Exchange submitted a 
request for a no-action letter (the ``No-Action Letter''), on its 
own behalf, and behalf of its listed companies, seeking Commission 
staff concurrence in the view that a company's filing of a report or 
other material covered by this rule change through EDGAR will 
satisfy the company's obligation under the Commission's rules to 
file the material with the Exchange, and that the Exchange's receipt 
and retention of such document through EDGAR will satisfy the 
Exchange's obligations under Rule 17a-1 under the Act. Although the 
proposed rule change is effective upon filing, the Exchange will not 
implement the rule change until the Commission staff concurs with 
the relief requested in the No-Action Letter.
    \4\ The Exchange represents that it has obtained real-time 
access to all filings made by Exchange-listed companies through a 
``Level 1'' subscription with a commercial vendor. Telephone 
conversation between Patricia Levy, General Counsel, CHX, Karl 
Varner, Special Counsel, Division of Market Regulation, Commission 
and Sonia Patton, Attorney, Division of Market Regulation, 
Commission, on December 14, 1998.
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    The Exchange will continue to require hard copy filings for 
material necessary to support a listing application. The Exchange 
currently accepts listing applications only in hard copy format. The 
Exchange will continue to require the exhibits and attachments to 
listing applications, including registration material filed with the 
Commission, to be filed in hard copy form. The proposed rule change 
does not affect companies, if any such companies exist, that do not use 
EDGAR and instead continue to file paper reports with the Commission.
2. Statutory Basis
    The proposed rule change is consistent with section 6(b)(5) of the 
Act \5\ in that it is designed to promote just and equitable principles 
of trade, to foster cooperation and coordination with persons 
regulating securities transactions, 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.
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    \5\ 15 U.S.C. 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.

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 and, therefore, has 
become effective pursuant to Section 19(b)(3)(A)(i) of the Act,\6\ and 
subparagraph (e) of Rule 19b-4 thereunder.\7\ The Exchange will not 
implement the proposed rule change until the Commission staff concurs 
with the relief requested in the No-Action Letter, i.e., that a 
company's filing of a report or other material covered by this rule 
change through EDGAR will satisfy the company's obligation under the

[[Page 1044]]

Commission's rules to file the material with the Exchange and that 
retention of such information in the EDGAR system will satisfy the 
Exchange's record retention requirements under Rule 17a-1 under the 
Act. At any time within 60 days of the filing of such 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.\8\
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    \6\ 15 U.S.C. 78s(b)(3)(A)(i).
    \7\ 17 CFR 240.19b-4
    \8\ In reviewing this proposal, the Commission has considered 
its impact on efficiency, competition, and capital formation. 15 
U.S.C. 78c(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. 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. 522, will be available for inspection and copying at the 
Commission's Public Reference Room in Washington, DC. Copies of such 
filing will also be available for inspection and copying at the 
principal office of the above-mentioned self-regulatory organization. 
All submissions should refer to File No. SR-CHX-98-28 and should be 
submitted by January 28, 1999.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-304 Filed 1-6-99; 8:45 am]
BILLING CODE 8010-01-M