Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), and Rule 19b-4 thereunder, notice is hereby given that on January 3, 2001, the Pacific Exchange, Inc. (“PCX” 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. Amendment No. 1 to the proposed rule change was filed on January 5, 2001. Amendment No. 2 to the proposed rule change was filed on January 16, 2001. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.Start Printed Page 8833
I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Exchange is proposing to adopt new rules requiring all members and member organizations to establish with the Exchange an Internet electronic mail account. Below is the text of the proposed rule change. New text is in italics.
Pacific Exchange, Inc.
Rules of the Board of Governors
¶ 3083 Electronic Mail Address
Rule 1.13 Each member organization must maintain with the PCX an Internet electronic mail account for communication with the PCX. Each member organization must update its member firm contact information via the electronic mail account or such other means as prescribed by the PCX. The PCX will use the electronic mail account to provide member organizations with regulatory bulletins, rule adoption notices, and other official notices.
Rules of the Board of Directors of PCX Equities, Inc.
Equity Trading Permits and Equity ASAPS
¶ 7904Y Electronic Mail Address
Rule 2.26 Each ETP Holder, Equity ASAP Holder and ETP Firm must maintain with the PCX Equities, Inc. (“PCXE”) an Internet electronic mail account for communication with the PCXE. Each ETP Holder, Equity ASAP Holder and ETP Firm must update firm contact information via the electronic mail account or such other means as prescribed by the PCXE. The PCXE will use the electronic mail account to provide ETP Holders, Equity ASAP Holders and ETP Firms with regulatory bulletins, rule adoption notices, and other official notices.
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 PCX 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. The Exchange 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
The proposed rule promotes Internet use by the Exchange and its member organizations  as a communication tool. As proposed, the rule would require each member organization to acquire and maintain an Internet electronic mail address. The electronic mail account will be used to provide member organizations with regulatory bulletins, rule adoption notices, and other official notices. The proposed rule will allow for a more convenient and efficient manner of communication than the current mail system. Use of this electronic mail account will facilitate timely communication between the Exchange and its members, more rapid distribution of Exchange information, and reduction or elimination of printed publications. The Commission has approved a similar rule filing submitted by the National Association of Securities Dealers, Inc. (“NASD”). In the order approving the NASD filing, the Commission stated that use of the Internet as a business tool is expanding rapidly. The Commission also stated that the Internet is recognized as an efficient and cost-effective means of communication in the business world.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act, in general, and furthers the objectives of Section 6(b)(5), in particular, in that it is designed to promote just and equitable principles of trade, prevent fraudulent and manipulative acts and practices, and protect investors and the public interest by allowing for a more efficient and convenient manner of communication with member organizations.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will impose any burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
Written comments on the proposed rule change were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
The foregoing rule change shall become operative 30 days after the date of filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest pursuant to Section 19(b)(3)(A)(iii) of the Act, and subparagraph (f)(6) of Rule 19b-4 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.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change, as amended, is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549-0609. 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 Start Printed Page 8834available for inspection and copying at the principal office of the PCX. All submissions should refer to File No. SR-PCX-01-02 and should be submitted by February 23, 2001.Start Signature
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.
Margaret H. McFarland,
3. In Amendment Nos. 1 and 2, the PCX changed the filing number by withdrawal and re-filing, and corrected numbering and captions in the text of the proposed rule change. See letters from Hasan Abedi, Attorney, PCX, to Andrew Shipe, Attorney, Division of Market Regulation, Commission, dated January 4, 2001 and January 12, 2001 (“Amendment Nos. 1 and 2”).Back to Citation
4. As used herein, the term “member organization” will be synonymous with Equity Trading Permit Holder (“ETP Holder”), Equity Automated Systems Access Privileges Holder (“Equity ASAP Holder”) and Equity Trading Permit Firm (“ETP Firm”) under the proposed new rule for PCX Equities, Inc. Telephone conservation between Hassan Abedi, Attorney, PCX, and Andrew Shipe, Attorney, Division of Market Regulation, SEC, January 12, 2001.Back to Citation
5. See Securities Exchange Release Act No. 39958 (May 5, 1998), 63 FR 26240 (May 12, 1998).Back to Citation
6. Id. at 26241.Back to Citation
7. Id. at 26241.Back to Citation
[FR Doc. 01-2848 Filed 2-1-01; 8:45 am]
BILLING CODE 8010-01-M