[Federal Register Volume 67, Number 215 (Wednesday, November 6, 2002)]
[Notices]
[Pages 67663-67664]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-28129]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

[Extension: Rule 12a-5 and Form 26, SEC File No. 270-85, OMB Control 
No. 3235-0079; Rule 15c1-7, SEC File No. 270-146, OMB Control No. 3235-
0134; Rule 15Aj-1, SEC File No. 270-25, OMB Control No. 3235-0044.]

    Upon written request, copies available from: Securities and 
Exchange Commission, Office of Filings and Information Services, 
Washington, D.C. 20549.

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') is soliciting comments on the collections 
of information summarized below. The Commission plans to submit the 
existing collection of information to the Office of Management and 
Budget for extension and approval.
    [sbull] Rule 12a-5--Temporary Exemption Substituted or Additional 
Securities
    Rule 12a-5 of the Securities Exchange Act of 1934 (the ``Act'') 
generally makes it unlawful for any security to be traded on a national 
securities exchange unless such security is registered on the exchange 
in accordance with the provisions of the Act and the rules and 
regulations thereunder.
    Rule 12a-5 and Form 26 were adopted by the Commission in 1936 and 
1955 pursuant to sections 3(a)(12), 10(b), and 23(a) of the Act. 
Subject to certain conditions, Rule 12a-5 affords a temporary exemption 
(generally for up to 120 days) from the registration requirements of 
section 12(a) of the Act for a new security when the holders of a 
security admitted to trading on a national securities exchange obtain 
the right (by operation of law or otherwise) to acquire all or any part 
of a class of another or substitute security of the same or another 
issuer, or an additional amount of the original security. The purpose 
of the exemption is to avoid an interruption of exchange trading to 
afford time for the issuer of the new security to list and register it, 
or for the exchange to apply for unlisted trading privileges.
    Under paragraph (d) of Rule 12a-5, after an exchange has taken 
action to admit any security to trading pursuant to the provisions of 
the rule, the exchange is required to file with the Commission a 
notification on Form 26. Form 26 provides the Commission with certain 
information regarding a security admitted to trading on an exchange 
pursuant to Rule 12a-5, including: (1) The name of the exchange, (2) 
the name of the issuer, (3) a description of the security, (4) the 
date(s) on which the security was or will be admitted to when-issued 
and/or regular trading, and (5) a brief description of the transaction 
pursuant to which the security was or will be issued.
    The Commission generally oversees the national securities 
exchanges. This mission requires that, under section 12(a) of the Act 
specifically, the Commission receive notification of any securities 
that are permitted to trade on an exchange pursuant to the temporary 
exemption under Rule 12a-5. Without Rule 12a-5 and Form 26 the 
Commission would be unable to fully implement these statutory 
responsibilities.
    There are currently eight national securities exchanges subject to 
Rule 12a-5. While approximately 40 Form 26 notifications are filed 
annually, the reporting burdens are not typically spread evenly among 
the exchanges.\1\ For purposes of this analysis of burden, however, the 
staff has assumed that each exchange files an equal number (five) of 
Form 26 notifications. Each notification requires approximately 20 
minutes to complete. Each respondent's compliance burden, then, in a 
given year would be approximately 100 minutes (20 minutes/report x 5 
reports = 100 minutes), which translates to just over 13 hours in the 
aggregate for all respondents (8 respondents x 100 minutes/respondent = 
800 minutes, or 13\1/3\ hours).
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    \1\ In fact, some exchanges do not file any notifications on 
Form 26 with the Commission in a given year.
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    Based on the most recent available information, the Commission 
staff estimates that the cost to respondents of completing a 
notification on Form 26 is, on average, $14.35 per response. The staff 
estimates that the total annual related reporting cost per respondent 
is $71.75 (5 responses/respondent x $14.35 cost/response), for a total 
annual related cost to all respondents of $574 ($71.75 cost/respondent 
x 8 respondents).
    [sbull] Rule 15c1-7--Discretionary Accounts
    Rule 15c1-7 provides that any act of a broker-dealer designed to 
effect securities transactions with or for a customer account over 
which the broker-dealer (directly or through an agent or employee) has 
discretion will be considered a fraudulent, manipulative, or deceptive 
practice under the federal securities laws, unless a record is made of 
the transaction immediately by the broker-dealer. The record must 
include (a) The name of the customer, (b) the name, amount, and price 
of the security, and (c) the date and time when such transaction took 
place.
    The information required by the rule is necessary for the execution 
of the Commission's mandate under the Act to prevent fraudulent, 
manipulative, and deceptive acts and practices by broker-dealers. This 
is used by the Commission and the various self-regulatory organizations 
in compliance examinations to determine whether such trades have 
occurred.

[[Page 67664]]

    Respondents to Rule 15c1-7 consist of broker-dealers that effect 
security transactions with or for a customer account over which the 
broker-dealer has discretion.
    The Commission estimates that 500 respondents collect information 
annually under Rule 15c1-7 and that approximately 33,333 hours would be 
required annually for these collections.
    [sbull] Rule 15Aj-1--Amendments and Supplements to Registration 
Statements of Securities Associations
    Rule 15Aj-1 implements the requirements of sections 15A, 17, and 19 
of the Act by requiring every association registered as, or applying 
for registration as, a national securities association or as an 
affiliated securities association to keep its registration statement 
up-to-date by making periodic filings with the Commission on Form X-
15AJ-1 and Form X-15AJ-2.
    Rule 15Aj-1 requires a securities association to promptly notify 
the Commission after the discovery of any inaccuracy in its 
registration statement or in any amendment or supplement thereto by 
filing an amendment to its registration statement on Form X-15AJ-1 
correcting such inaccuracy. The rule also requires an association to 
promptly notify the Commission of any change which renders no longer 
accurate any information contained or incorporated in its registration 
statement or in any amendment or supplement thereto by filing a current 
supplement on Form X-15AJ-1. Rule 15Aj-1 further requires an 
association to file each year with the Commission an annual 
consolidated supplement on Form X-15AJ-2.
    The information required by Rule 15Aj-1 and Forms X-15AJ-1 and X-
15AJ-2 is intended to enable the Commission to carry out its 
statutorily mandated oversight functions and to assure that registered 
securities associations are in compliance with the Act. This 
information is also made available to members of the public. Without 
the requirements imposed by the rule, the Commission would be unable to 
fulfill its regulatory responsibilities.
    There is presently only one registered securities association, 
which registered in 1939, subject to the rule. The burdens associated 
with Rule 15Aj-1 requirements have been borne by only one securities 
association since Rule 15Aj-1 was adopted. Furthermore, the burdens 
associated with Rule 15Aj-1 vary depending on whether amendments and 
current supplements are filed on Form X-15AJ-1 in addition to an annual 
consolidated supplement filed on Form X-15AJ-2. The Commission staff 
estimates the burden in hours necessary to comply with the rule by 
filing an amendment or a current supplement on Form X-15AJ-1 to be 
approximately one-half hour, with a related cost of $12, per response. 
The Commission staff estimates the burden in hours necessary to comply 
with the rule by filing an annual consolidated supplement on Form X-
15AJ-2 to be approximately three hours, with a related cost of $96. 
Therefore, the Commission staff estimates that the total annual related 
reporting cost associated with the rule to be upwards of $96, assuming 
a minimum filing of an annual consolidated statement on Form X-15AJ-2, 
with additional filings on Form X-15AJ-1 correspondingly increasing 
such reporting cost.
    Written comments are invited on: (a) Whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the agency, including whether the information shall 
have practical utility; (b) the accuracy of the Commission's estimate 
of the burden of the proposed collection of information; (c) ways to 
enhance the quality, utility, and clarity of the information to be 
collected; and (d) ways to minimize the burden of the collection of 
information on respondents, including through the use of automated 
collection techniques or other forms of information technology. 
Consideration will be given to comments and suggestions submitted in 
writing within 60 days of this publication.
    Direct your written comments to Kenneth A. Fogash, Acting Associate 
Executive Director/CIO, Office of Information Technology, Securities 
and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549.

Margaret H. McFarland,
Deputy Secretary.
    Dated: October 30, 2002.
[FR Doc. 02-28129 Filed 11-5-02; 8:45 am]
BILLING CODE 8010-01-P[FEDREG][VOL]*[/VOL][NO]*[/NO][DATE]*[/
DATE][NOTICES]