[Federal Register Volume 62, Number 116 (Tuesday, June 17, 1997)]
[Notices]
[Pages 32848-32849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-15771]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38731; File No. SR-NYSE-97-08]
Self-Regulatory Organizations; Order Approving Proposed Rule
Change by New York Stock Exchange, Inc. Consisting of an Information
Memo Relating to Electronic Delivery of Information to Customers by
Exchange Members and Member Organizations
June 10, 1997.
On March 24, 1997,\1\ the New York Stock Exchange, Inc. (``NYSE''
or ``Exchange'') submitted to the Securities and Exchange Commission
(``SEC'' or ``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \2\ and Rule 19b-4
thereunder,\3\ a proposed rule change setting forth the Exchange's
policy regarding electronic delivery of information required under
Exchange rules to be furnished to customers. A notice of the proposed
rule change appeared in the Federal Register on May 7, 1997.\4\ The
Commission received no comment letters addressing the proposed rule
change.
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\1\ On April 24, 1997, the NYSE amended the exhibit attached to
the rule filing. See letter from James E. Buck, Senior Vice
President and Secretary, NYSE, Inc., to Katherine A. England,
Assistant Director, Division of Market Regulation, SEC, dated April
24, 1997.
\2\ 15 U.S.C. 78s(b)(1) (1988).
\3\ 17 CFR 240.19b-4 (1995).
\4\ Securities Exchange Act Release No. 38567 (May 1, 1997); 62
FR 25009 (May 7, 1997).
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The Exchange has filed with the Commission an Information Memo
(``Memo'') setting forth the Exchange's policy regarding electronic
delivery of information required under Exchange rules to be furnished
to customers. Under this proposed Exchange policy, members and member
organizations will be allowed to electronically transmit documents
required to be furnished to customers under Exchange rules, provided
that they adhere to the Commission's established requirements. The
Commission, in Release Nos. 34-37182 \5\ and 33-7233,\6\ addresses the
procedural aspects of how broker-dealers and others may satisfy their
delivery obligations under federal securities laws by using electronic
media as an alternative to paper-based media provided that they comply
with certain prescribed requirements.
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\5\ See, Securities Exchange Act Release No. 37182, May 9, 1996;
61 FR 24644, May 15, 1996, (Commission's interpretation concerning
the delivery of information through electronic media in satisfaction
of broker-dealer and transfer agent requirements to deliver
information under the Act and the rules thereunder).
\6\ See, Securities Act Release No. 7233, Oct. 6, 1995; 60 FR
53458, Oct. 13, 1995, (Commission's interpretation concerning the
use of electronic media as a means of delivering information
required to be disseminated pursuant to the Securities Act of 1933,
the Securities Exchange Act of 1934, and the Investment Company Act
of 1940).
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The Memo summarizes the Commission procedures, which address
format, content, access, evidence of receipt of delivery, and consent
for delivery of personal financial information. The Memo also sets
forth a list of current Exchange rules that require members and member
organizations to furnish specific information to customers for which
electronic delivery may be used in accordance with the Commission
Releases.\7\ The Exchange intends that the policy outlined in this Memo
cover all communications required to be sent to customers by firms
pursuant to Exchange rules.
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\7\ The Exchange believes this list is complete. The Commission
notes, however, that if the Exchange proposes a rule for which
electronic delivery of information to customers may be used, then
the Exchange should specify that the rule would be governed by this
interpretation, as well.
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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
promulgated thereunder. Specifically, the
[[Page 32849]]
Commission believes that approval of the proposed rule change is
consistent with Section 6(b)(5) \8\ of the Act. Pursuant to Section
6(b)(5), the proposed rule change benefits the public,\9\ because it
not only allows customers easy and efficient access to account
documentation, but also requires an evaluation of systems and
procedures to ensure that the privacy of personal information is
maintained. In using the Commission's releases as a guide,\10\ the
Exchange has established a uniform policy concerning electronic
delivery of information which should allow members and member
organizations to satisfy their delivery obligations under federal
securities laws and the Exchange's rules. This uniform policy should
simplify compliance by members and member organizations and aid the
Exchange in monitoring the same.
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\8\ Section 6(b)(5) requires the Commission to determine that a
registered national securities exchange's rules are designed to
prevent fraudulent acts and practices, to promote just and equitable
principles of trade, and, in general, to protect investors and the
public interest.
\9\ Pursuant to Section 3(f) of the Act, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. 15 U.S.C. Sec. 78c(f) (1996).
\10\ See supra notes 5 and 6.
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For the above reasons, the Commission believes that the proposed
rule change is consistent with the provisions of the Act, and in
particular with Section 6(b)(5).
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\11\ that the proposed rule change (SR-NYSE-97-08) be, and hereby
is approved.
\11\ 15 U.S.C. 78s(b)(2) (1988).
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For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-15771 Filed 6-16-97; 8:45 am]
BILLING CODE 8010-01-M