[Federal Register Volume 65, Number 168 (Tuesday, August 29, 2000)]
[Notices]
[Pages 52463-52464]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-21959]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-43193; File No. SR-PCX-00-28]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc. 
Relating to Minor Rule Plan Citation Authority

August 22, 2000.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'' \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on August 16, 2000, the Pacific Exchange, Inc. (``PCX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'' or ``SEC'') the proposed rule change as described in 
Items I, II and III below, which Items have been prepared by the 
Exchange. The proposed rule change has become effective on filing with 
the Commission pursuant to Section 19(b)(3) \3\ of the Act and 
subparagraph (f)(3) of Rule 19b-4 \4\ under the Act because it is 
concerned solely with the administration of the Exchange. 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).
    \2\ 17 CFR 240.19b-4(f)(2).
    \3\ 15 U.S.C. 78s(b)(3).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange proposes to amend its Minor Rule Plan (``Plan'') to 
allow any PCX Regulatory Staff designated by the PCX to have the 
authority to issue a Floor Citation pursuant to the Plan. The text of 
the proposed rule change is below. Additions are italicized; deletions 
are bracketed.

6133  Minor Rule Plan

    Rule 10.13.(a)--(f) No Change.
    (g) Floor Citations. A Floor Official, [and/or] an Options Order 
Book Official or any PCX Regulatory Staff designated by the Exchange 
may issue a Floor Citation to any member, member organization or person 
associated with a member or member organization, when it appears to 
such Official(s) that a Minor Rule Plan violation specified in 
subsections (h) or (i) of this Rule has occurred. In issuing a Floor 
Citation, the Floor Official, [and/or] an Options Order Book Official 
or any PCX Regulatory Staff designated by the Exchange [shall] must:
    (1) Apprise the person cited of the alleged violation;
    (2) Ask the person cited to indicate by signature on the citation 
acknowledgment of receipt of the citation; provided that the requested 
signature is for receipt purposes only and a failure or unwillingness 
to sign is not to be considered as invalidating the issuance of the 
citation;
    (3) Give the top copy of the citation to the person alleged to have 
committed the violation; and
    (4) Give the remaining copies of the citation to the Order Book 
Official or an appropriate staff person, who will then forward such 
copies to the Regulation Department for processing.
    Except as provided in Rule 10.14 (Summary Sanction Procedure), the 
circumstances underlying the issuance of each floor citation shall be 
reviewed by a designated committee for a determination of whether the 
evidence is sufficient to find a violation of Exchange rules.\5\
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    \5\ This paragraph is being removed pursuant to SR-PCX-99-48.
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    (h)-(k)--No Change.

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 Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the

[[Page 52464]]

proposed rule change. The text of these statements may be examined at 
the places specified in Item IV below. The Exchange 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
    Under PCX's Minor Rule Plan, Rule 10.13, a Floor Official and/or an 
Options Order Book Official may issue a Floor Citation to any member, 
member organization or person associated with a member or member 
organization when it appears that a Minor Rule Plan violation has 
occurred. The Exchange seeks to amend Rule 10.13 to allow any PCX 
Regulatory Staff designated by the Exchange to have the ability to 
issue such floor citations.
    Currently under PCX Rule 10.4(a) ``Any standing committee 
designated by the Board of Governors to review disciplinary 
proceedings, and Exchange Regulatory Staff designated by the Exchange, 
has the authority to determine whether there is probable cause for 
finding that a violation within the disciplinary jurisdiction of the 
Exchange has occurred and that further proceedings are warranted.'' The 
Exchange believes that amending the Plan to grant any designated 
Exchange Regulatory Staff the ability to issue citations is consistent 
with the Act and the PCX Rules. The Exchange notes that the issuance of 
a floor citation does not constitute a finding. Rather, similar to 
other PCX disciplinary rules, a floor citation merely serves to 
initiate an investigation. Each floor citation issued will continue to 
be reviewed by Exchange Surveillance Staff for accuracy and validity. 
The Exchange believes that this will allow the Regulatory Staff the 
ability to effectively and efficiently monitor trading crowds and floor 
trading activity. The Exchange notes that this rule amendment in no way 
changes PCX Rule 10.14, ``Summary Sanction Procedure.''
2. Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) \6\ of the Act, in general, and furthers the 
objectives of Section 6(b)(5) \7\, in particular, in that it is 
designed to promote just and equitable principles of trade.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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

    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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3) \8\ of the Act and subparagraph (f)(3) of Rule 19b-4 \9\ under 
the Act because it is concerned solely with the administration of the 
Exchange. 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.
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    \8\ 15 U.S.C. 78s(b)(3).
    \9\ 17 CFR 240.19b-4(f)(3).
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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 20549-0609. 
Copies of the submission, all subsequent amendments, 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 in the Commission's Public 
Reference Room. Copies of such filing will also be available for 
inspection and copying at the principal office of the PCX. All 
submissions should refer to File No. SR-PCX-00-28 and should be 
submitted by September 19, 2000.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.20-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 00-21959 Filed 8-28-00; 8:45 am]
BILLING CODE 8010-01-M