[Federal Register Volume 68, Number 248 (Monday, December 29, 2003)]
[Notices]
[Pages 75011-75012]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-31808]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48936; File No. SR-PCX-2003-32]


Self-Regulatory Organizations; Pacific Stock Exchange, Inc.; 
Order Granting Approval of Proposed Rule Change to Incorporate New PCX 
Rules Into Its Minor Rule Plan

December 17, 2003.
    On July 8, 2003, the Pacific Stock Exchange, Inc. (``PCX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission''), 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 to adopt new PCX Rules 10.13(h)(40)-(44) and 
10.13(k)(i)(40)-(44) in order to incorporate five existing PCX rules 
into the Minor Rule Plan and Recommended Fine Schedule.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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    The proposed rule change was published for comment in the Federal 
Register on November 12, 2003.\3\ The Commission received no comments 
on the proposal.
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    \3\ See Securities Exchange Act Release No. 48746 (November 4, 
2003), 68 FR 64182.
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    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange \4\ and, in 
particular, the requirements of section 6 of the Act \5\ and the rules 
and regulations thereunder. In particular, the Commission believes that 
the proposed rule change is consistent with section 6(b)(6) \6\ of the 
Act because it should enable the Exchange to appropriately discipline 
its members and others associated with its members for violation of the 
provisions of this title, the rules or regulations thereunder, or the 
rules of the Exchange.
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    \4\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(6).
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    In approving this proposed rule change, the Commission in no way 
minimizes the importance of compliance with these rules, and all other 
rules subject to the imposition of fines under the Exchange's minor 
rule violation plan. The Commission believes that the violation of any 
self-regulatory organization's rules, as well as Commission rules, is a 
serious matter. However, in an effort to provide the Exchange with 
greater flexibility in

[[Page 75012]]

addressing certain violations, the Exchange's minor rule violation plan 
provides a reasonable means to address rule violations that do not rise 
to the level of requiring formal disciplinary proceedings. The 
Commission expects that the PCX will continue to conduct surveillance 
with due diligence, and make a determination based on its findings 
whether fines of more or less than the recommended amount are 
appropriate for violations of rules under the Exchange's minor rule 
violation plan, on a case by case basis, or if a violation requires 
formal disciplinary action.
    In addition, the Commission notes that proposed rules 10.13(h)(40), 
10.13(h)(41), and 10.13(h)(43) relate to market making obligations. The 
Commission believes that only the most technical and non-substantive 
violations of a market maker's obligations should be handled pursuant 
to a minor rule plan.\7\
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    \7\ See, e.g., Securities Exchange Act Release No. 27878 (April 
14, 1990), 55 FR 13345, [SR-NYSE-89-44].
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    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\8\ that the proposed rule change (SR-PCX-2003-32) be, and it 
hereby is, approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    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. 03-31808 Filed 12-24-03; 8:45 am]
BILLING CODE 8010-01-P