[Federal Register Volume 65, Number 217 (Wednesday, November 8, 2000)]
[Notices]
[Pages 67028-67029]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-28649]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-43488; File No. SR-NYSE-00-41]


Self-Regulatory Organization's; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by New York Stock Exchange, Inc., 
Relating to Approval Procedures for Exchange Employee Securities 
Accounts

October 27, 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 October 6, 2000, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by 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.
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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 NYSE Rule 407.10 to make the 
Exchange's Ethics Officer the party to whom employees of the Exchange 
or any of its affiliates must apply for permission to open a securities 
or commodities account. The Exchange also proposes to clarify that the 
Rule's provisions are not applicable to any affiliated company (as that 
term is defined by the Rule) which administers a corporate employee 
securities account disclosure program.
    The text of the proposed rule change is available at the NYSE and 
at the Commission.

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 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
    NYSE Rule 407.10 directs Exchange employees, and employees of 
Exchange affiliates, who wish to open a securities or commodities 
account to apply to the Secretary of the Exchange for permission. The 
purpose of the proposed rule change is to require those employees to 
submit those applications for approval to the Exchange's Ethics Officer 
rather than the Exchange's Secretary.
    The Exchange's ethics functions are performed by the office of the 
Exchange's senior Human Resources officer, who is also the Exchange's 
Ethics Officer. The Human Resources Division, as part of its 
traditional function and as part of its ethics function, maintains a 
database on Exchange employees. The Exchange Secretary also maintains a 
database on Exchange employees for the purpose of authorizing 
securities and commodities accounts.
    The Exchange believes that shifting the account-approval function 
to the Ethics Officer will eliminate duplicative record-keeping and 
will place the function with the officer most appropriate for making 
account-approval decisions.
    The Exchange also proposes to amend NYSE Rule 407.10 to clarify 
that the Rule's provisions are not applicable to any affiliated company 
(as that term is defined by the Rule) which administers a corporate 
employee securities account disclosure program. This will avoid 
duplicative approval processes.\3\
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    \3\ Currently, the Securities Industry Automation Corporation 
(``SIAC'') is the only NYSE affiliated company that administers its 
own corporate employee disclosure program. In this regard, SIAC has 
a rule similar to NYSE Rule 407.10 requiring SIAC employees to apply 
to SIAC for permission to open a securities or commodities account. 
SIAC employees are not required to also seek permission from the 
NYSE. Telephone call between Steve Abrams, NYSE, and Jennifer 
Colihan, Attorney, Division of Market Regulation, Commission, 
October 25, 2000.

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[[Page 67029]]

2. Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\4\ in general, and furthers the 
objectives of Section 6(b)(5) \5\ in particular, in that it is designed 
to prevent fraudulent and manipulative acts and practices, and, in 
general, to protect investors and the public interest.
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    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not 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 were neither solicited nor received.

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

    The foregoing rule change is concerned solely with the 
administration of the Exchange. Therefore, the proposed rule change has 
become effective pursuant to Section 19(b)(3)(A) of the Act \6\ and 
Rule 19b-4(f)(3) thereunder.\7\ 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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    \6\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \7\ 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, N.W., Washington, D.C. 20549-
0609. 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. 552, will be available for inspection and copying in the 
Commission's Public Reference Section. Copies of such filing will also 
be available for inspection and copying at the principal office of the 
NYSE. All submissions should refer to the File No. SR-NYSE-00-41 and 
should be submitted by November 29, 2000.

    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. 00-28649 Filed 11-7-00; 8:45 am]
BILLING CODE 8010-01-M