[Federal Register Volume 60, Number 129 (Thursday, July 6, 1995)]
[Notices]
[Pages 35247-35248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16478]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35913; File No. SR-Amex-95-22]
Self-Regulatory Organizations; Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule Change by the American
Stock Exchange, Inc. Relating to the Entry of Market-at-the-Close
Orders Through AMOS
June 28, 1995.
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 June 5, 1995, the American Stock Exchange, Inc. (``Amex'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
\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 Amex proposes to amend Exchange Rule 109, Commentary .02, to
correct an error in SR-Amex-95-09 \3\ regarding entry of market-at-the-
close (``MOC'') orders \4\ through the Post Execution Reporting
(``PER'') or Amex Options Switching (``AMOS'') systems.\5\ The text of
the proposed rule change is as follows:
\3\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60
FR 22592.
\4\ A market-at-the-close order is a market order that is to be
executed at or as near to the close as practicable. See American
Stock Exchange Guide, Rule 131(e), (CCH) para. 9281.
\5\ The PER system provides member firms with the means to
electronically transmit equity orders, up to volume limits specified
by the Exchange, directly to the specialist's post on the trading
floor of the Exchange. Securities Exchange Act Release No. 33486
(Jan. 18, 1994), 59 FR 54016. Similarly, the AMOS system is a
computerized order routing system that provides member firms with
the means to electronically transmit option orders directly to the
trading floor of the Exchange. Securities Exchange Act Release No.
34869 (Oct. 20, 1994), 59 FR 4293.
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[new text is italicized; deleted text is bracketed]:
Rule 109
* * * * *
Commentary
* * * * *
.02 Members entering market-at-the-close orders through the PER [or
AMOS] system[s] must do so no later than 3:50 p.m. The foregoing shall
not limit or restrict the entry of market-at-the-close orders (or their
cancellation) other than via such system[s].
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 self-regulatory organization
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 III below. The self-regulatory
organization 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 Commission recently approved an amendment to Exchange Rule 109,
Commentary .02, that imposed a 3:50 p.m. deadline for the entry,
cancellation, or reduction of MOC orders through the PER or AMOS
systems.\6\ The Exchange, however, did not intend to apply the 3:50
p.m. deadline to options orders and, therefore, the reference to the
AMOS system in its rule filing was incorrect. The disruptions that have
resulted from MOC equity orders entered through PER have not been a
concern with respect to option orders entered through AMOS. Therefore,
the restriction on MOC orders in options is unnecessary. Although there
are very few MOC option orders entered through AMOS, the 3:50 p.m.
deadline is inconvenient to both member organizations and to the
Exchange. Moreover, no other options exchange imposes such a
restriction.
\6\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60
FR 22592.
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2. Statutory Basis
The proposed rule change is consistent with Section 6(b) \7\ of the
Act in general and furthers the objectives of Section 6(b)(5) \8\ in
particular in that it is designed to promote just and equitable
principles of trade, to remove impediments to, and perfect the
mechanism of a free and open market and, in general, to protect
investors and the public interest.
\7\ 15 U.S.C. 78f.
\8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes the proposed rule change will impose no
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. 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. 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. Sec. 552, will be available for inspection and copying at
the Commission's Public Reference Section, 450 Fifth Street NW.,
Washington, DC 20549. Copies of such filing will also be available for
inspection and copying at the principal office of the American Stock
Exchange. All submissions should refer to File No. SR-Amex-95-22 and
should be submitted by July 27, 1995.
IV. Commission's Findings and Order Granting Accelerated Approval of
Proposed Rule Change
The Commission has reviewed carefully the Amex's proposed rule
change and believes, for the reasons set forth below, the proposal is
consistent with the requirements of Section 6 of
[[Page 35248]]
the Act \9\ and the rules and regulations thereunder applicable to a
national securities exchange. Specifically, the Commission believes the
proposal is consistent with Section 6(b)(5) of the Act \10\ because it
will facilitate transactions in securities by allowing for the timely
transmission of MOC orders in options to the Amex floor, promote just
and equitable principles of trade, remove impediments to, and perfect
the mechanism of a free and open market.
\9\ 15 U.S.C. 78f.
\10\ 15 U.S.C. 78f(b)(5).
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The Commission finds good cause for approving the proposed rule
change prior to the thirtieth day after the date of publication of
notice thereof in the Federal Register. The Commission notes that prior
to the erroneous reference to the AMOS system in SR-Amex-95-09,\11\
member firms were able to enter MOC orders in options after 3:50 p.m.
via the AMOS system. Since the approval of that filing, however, the
Amex's members have been unable to enter such orders. The Exchange has
represented that the implementation of this restriction was a mistake
on their part, is unnecessary, and is inconvenient to both the Exchange
and its members. Based upon this and the Exchange's further
representation that the removal of this deadline would simply reinstate
the ability of member firms to enter MOC orders in options after 3:50
p.m., the Commission deems it appropriate to approve the proposed rule
change on an accelerated basis. The Commission believes, therefore,
that granting accelerated approval of the proposed rule change is
appropriate and consistent with Section 6 of the Act.\12\
\11\ Securities Exchange Act Release No. 35660 (May 2, 1995), 60
FR 22592.
\12\ 15 U.S.C. 78f.
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It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\13\ that the proposed rule change is hereby approved on an
accelerated basis.
\13\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\14\
\14\ 17 CFR 200.30-3(a)(12).
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Margaret M. McFarland,
Deputy Secretary.
[FR Doc. 95-16478 Filed 7-5-95; 8:45 am]
BILLING CODE 8010-01-M