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 May 16, 2001, the Philadelphia Stock Exchange, Inc. (“Phlx”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III below, which Items the Phlx has prepared. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.
I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Phlx proposes to amend Phlx Rule 455, Short Sales, by adding new Supplementary Material .01. The text of the proposed rule change is below, with new language in italics.
Rule 455. Short Sales
(a)-(d) No change.
.01 This Rule 455 shall not prohibit any transaction or transactions which the Commission, upon written request or upon its motion, exempts, either unconditionally or on specified terms and conditions.
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 Phlx 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 Phlx 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
Rule 10a-1 under the Act  addresses short selling. Subsection (f) of Rule 10a-1 provides that Rule 10a-1 shall not prohibit any transaction or transactions that the Commission, upon written request or upon its own motion, exempts, either unconditionally or on specified terms and conditions.
Phlx Rule 455 also addresses short selling. proposed Supplementary Material .01 of Phlx Rule 455 would track the language of Rule 10a-1(f) to clarify that nothing in Phlx Rule 455 prohibits any transaction or transactions that the Commission has exempted from Rule 10a-1 pursuant to Rule 10a-1(f).
2. Statutory Basis
The Phlx believes the proposed rule change is consistent with the provisions of Section 6(b) of the Act  and furthers the objectives of Section 6(b)(5) of the Act  in that it is designed to perfect the mechanisms of a free and open market and the national market system, protect investors and the public interest and promote just and equitable principles of trade by clarifying and describing clearly in the Phlx's rules that nothing in Phlx Rule 455 prohibits any transaction or transactions which the Commission, upon written request or upon its own motion, has exempted pursuant to Rule 10a-1(f).
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will result in any burden on competition that is not Start Printed Page 30971necessary or appropriate in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
The Phlx neither solicited nor received any written comments.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
The proposed rule change has become effective pursuant to Section 19(b)(3)(A)(i) of the Act  and subparagraph (f)(1) of Rule 19b-4 thereunder  because it constitutes a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule. At any time within 60 days of the filing of the 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 proposal is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Copies of the submission, all subsequent amendment, all written statement 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 that 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 the Phlx. All submissions should refer to file number SR-Phlx-2001-55 and should be submitted by June 29, 2001.Start Signature
For the Commission, by the Division of Market Regulation, pursuant to delegated authority.
Margaret H. McFarland,
[FR Doc. 01-14461 Filed 6-7-01; 8:45 am]
BILLING CODE 8010-01-M