[Federal Register Volume 61, Number 47 (Friday, March 8, 1996)]
[Notices]
[Pages 9515-9516]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5551]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36916; File No. SR-PSE-96-06]
Self-Regulatory Organizations; Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule Change by the Pacific
Stock Exchange Incorporated Relating to Distributing Interim Reports to
Both Registered and Beneficial Shareholders
March 4, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. Sec. 78s(b)(1), notice is hereby given that on
February 22, 1996, the Pacific Stock Exchange Incorporated (``PSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. On March 1, 1996, the Exchange submitted Amendment No. 1
to the proposed rule change.\1\ The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
\1\ See letter from Michael D. Pierson, PSE, to Jennifer Choi,
Division of Market Regulations, SEC, dated February 29, 1996. In
Amendment No. 1, the Exchange replaces the term ``shall'' with
``should'' in the text of Commentary .03 to PSE Rule 3.3(t). This
amendment makes the PSE's proposal consistent with those of the New
York Stock Exchange and the American Stock Exchange. See Securities
Exchange Act Release No. 35373 (Feb. 14, 1995), 60 FR 9709 (Feb. 21,
1995); Securities Exchange Act Release No. 36541 (Nov. 30, 1995), 60
FR 62921 (Dec. 7, 1995). In Amendment No. 1, the Exchange also makes
a couple of grammatical changes to Commentary .01 and Commentary .02
to PSE Rule 3.3(t).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is proposing to amend its rules to state that
corporations that distribute interim reports to shareholders should
distribute such reports to both registered and beneficial shareholders.
The text of the proposed rule change is available at the Exchange and
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 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 Exchange's Corporate Governance and Disclosure Policies
currently provide for the disclosure to shareholders of quarterly
reports and interim reports.\2\ The Exchange is proposing to adopt new
Commentary .03 to Rule 3.3(t) to provide that any listed company that
distributes interim financial reports should distribute such reports to
both registered and beneficial shareholders. The commentary would
further state that the financial reports that are subject to this rule
are those that are voluntarily distributed by the company as part of
its shareholder relations activities, and not the quarterly financial
reports required to be filed with the Commission pursuant to Section
13(a) and Section 15(d) of the Act. Although the distribution of
interim reports will continue to be voluntary, if a corporation chooses
to distribute interim reports to shareholders, it should distribute
them to both registered and beneficial shareholders.
\2\ See PSE Rule 3.3(t), Commentaries .01 and .02.
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The purpose of the proposed rule change is to ensure equal
treatment of record and beneficial shareholders in the distribution of
interim financial reports. The proposal is consistent with a similar
rule of the New York Stock
[[Page 9516]]
Exchange, which based its rule change on the findings of various
industry groups including the American Society of Corporate Secretaries
and the Securities Industry Association.\3\
\3\ See Securities Exchange Act Release No. 35373 (Feb. 14,
1995), 60 FR 9709 (Feb. 21, 1995).
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2. Statutory Basis
The basis under the Act for the proposed rule change is the
requirement under Section 6(b)(5) that an Exchange have rules that are
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.
B. Self-Regulatory Organization's Statement on Burden on Competition
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
No written comments were solicited or received with respect to 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 Exchange. All
submissions should refer to File No. SR-PSE-96-06 and should be
submitted by March 29, 1996.
IV. Commission's Findings and Order Granting Accelerated Approval of
Proposed Rule Change
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, and, in
particular, with the requirements of section 6(b).\4\ The Commission
believes the proposal is consistent with the section 6(b)(5)
requirements that the rules of an exchange be designed to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and national market system, and in general, to
protect investors and the public.
\4\ 15 U.S.C. Sec. 78(b).
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Although the Commission does not require public companies to
distribute interim reports to shareholders, the Commission believes
that it is appropriate for the Exchange to encourage its listed
companies to provided equal treatment of record and beneficial
shareholders in the distribution of reports.
The Commission finds good cause for approving the proposed rule
change prior to the thirtieth day after the date of publication of
notice of filing thereof in the Federal Register. The Commission
believes that accelerated approval is appropriate given the prior
approval of similar proposals by the NYSE and the Amex \5\ and because
the accelerated approval will allow the Exchange to encourage equal
distribution of interim reports to record and beneficial shareholders
as soon as practicable.
\5\ See supra note 1.
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Based on the above, the Commission finds that there is good cause,
consistent with section 6(b)(5) of the Act, to accelerate approval of
the amended proposed rule change.
It is therefore ordered, pursuant to section 19(b)(2) of the
Act,\6\ that the proposed rule change (SR-PSE-96-06) is approved.
\6\ 15 U.S.C. Sec. 78s(b)(2).
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For the Commission, by the Division of Market Regulation, pursuant
to delegated authority.\7\
\7\ 17 CFR 299.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-5551 Filed 3-7-96; 8:45 am]
BILLING CODE 8010-01-M