[Federal Register Volume 63, Number 214 (Thursday, November 5, 1998)]
[Notices]
[Pages 59816-59817]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-29621]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-40616; File No. SR-Amex-98-30]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the American Stock Exchange,
Inc. Relating to Options of Advertisements
October 28, 1998.
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 October 16, 1998,\3\ 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, II,
and III below, which items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ The proposed rule change was originally submitted on August
5, 1998. On October 16, 1998, the Exchange submitted Amendment No. 1
to add a footnote to Commentary .02 and Commentary .03(v) to Rule
991 stating the requirement of providing in options advertisements
the name and address of a person or persons from whom current
Options Disclosure Documents may be obtained ``may be satisfied by
providing a reasonably specific mechanism by which clients and other
investors may obtain this material.'' Letter from Claudia Crowley,
Special Counsel, Amex to Katherine A. England, Assistant Director,
Division of Market Regulation, Commission, dated October 15, 1998
(``Amendment No. 1'').
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
Amex proposes to adopt an interpretation to Rule 991 relating to
options communications with customers. The text of the proposed rule
change is available at the Office of the Secretary, Amex, and at 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, Amex 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 IV below. Amex has prepared summaries, set forth in sections A, B,
and C below, on 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
Amex Rule 991 details Exchange requirements with respect to
options-related communications with customers. Commentary .02 and
Commentary .03 to Rule 991, as well as the Guidelines for Options
Communications (published by the self-regulatory organizations) provide
in part that advertisements and educational material should contain the
name and address of a specific person from whom an Options Disclosure
Document (``ODD'') may be obtained. Common practice within the
securities industry is
[[Page 59817]]
for such communications to be published as part of a national or
regional marketing program. In that regard, the Exchange believes that
it is both unnecessary and impractical for a member organization to
list one person as the recipient for all requests concerning ODDs. It
is important for investors to be able to readily obtain an ODD. The
Exchange interprets Rule 991 to provide member organizations sufficient
latitude to set forth other reasonably specific mechanisms by which
clients and other investors may obtain the ODD. A firm may, for
example, provide one or more telephone numbers or addresses from which
an ODD may be obtained. Alternatively, in a communication addressed
only to account holders the organization may direct them to contact
their registered representative.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the Act
\4\ in general and furthers the objectives of Section 6(b)(5) \5\ in
particular in that it is designed to promote just and equitable
principles of trade, remove impediments to a free and open market and a
national market system, and protect investors and the public interest.
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\4\ 15 U.S.C. 78f(b).
\5\ 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
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
The proposed rule change constitutes a stated policy, practice, or
interpretation with respect to the meaning, administration, or
enforcement of an existing rule of the Exchange and, therefore, has
become effective upon filing pursuant to Section 19(b)(3)(A)(i) of the
Act \6\ and Rule 19b-4(e)(1) \7\ thereunder. At any time within 60 days
of the filing of such proposed rule change, the Commission may
summarily abrogate such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act.
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\6\ 15 U.S.C. 78s(b)(3)(A)(i).
\7\ 17 CFR 240.19b-4(e)(1).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act.\8\ Persons making written
submissions should file six copies thereof with the Secretary,
Securities and Exchange Commission, 450 Fifth Street, N.W., Washington,
D.C. 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. 552, will be available for inspection and
copying in the Commission's Public Reference Room. Copies of such
filing will also be available for inspection and copying at the
principal office of Amex. All submissions should refer to the File No.
SR-Amex-98-30 and should be submitted by November 27, 1998.
\8\ In reviewing this proposal, the Commission has considered
its impact on efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
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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. 98-29621 Filed 11-4-98; 8:45 am]
BILLING CODE 8010-01-M