Self-Regulatory Organizations; Notice of Filing of Proposed Rule Change by Pacific Stock Exchange, Inc., Relating to the Fine Schedule for the Rule on Dissemination of Quotations in Local Issues

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-34320; File No. SR-PSE-94-13]

Self-Regulatory Organizations; Notice of Filing of Proposed Rule

Change by Pacific Stock Exchange, Inc., Relating to the Fine Schedule

for the Rule on Dissemination of Quotations in Local Issues

July 6, 1994.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act''), 15 U.S.C. 78s(b)(1), notice is hereby given that on May 24,

1994, the Pacific Stock Exchange, Inc. (``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. 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 PSE is proposing to amend its fine schedule for violations of

Equity Floor Procedure Advice 2-B, relating to the dissemination of

quotations in local issues.

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 IV 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

Equity Floor Procedure Advice (``EFPA'') 2-B of the Rules of the

Pacific Stock Exchange is designed to enforce the requirement that PSE

specialists disseminate quotations in their assigned local issues every

day. Specifically, the specialist must disseminate a quote prior to

one-half (\1/2\) hour after the PSE opening.

In order to enforce this requirement, EFPA 2-B has a schedule that

requires that all specialists be monitored daily on a rotating

quarterly basis. Failure to satisfy the requirement currently results

in a $25 fine for each violation beginning with the sixth violation.

At this time, the PSE is proposing to amend this rule to provide

that the fine be changed to $100 with an implementation upon the third

violation. It is the position of the Exchange that this will provide an

effective deterrent and reflect a more appropriate penalty for non-

compliance with EFPA 2-B.

2. Statutory Basis

The proposed rule change is consistent with Section 6(b) of the

Act, is general, and Sections 6(b)(5) and 6(b)(6), in particular, in

that it is designed to protect investors and the public interest, to

promote just and equitable principles of trade, and to assure that

Exchange members are appropriately disciplined.

B. Self-Regulatory Organization's Statements on Burden on Competition

The Exchange does not believe that the proposed rule change will

impose any burden on competition that is not necessary 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

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

Within 35 days of the publication of this notice in the Federal

Register or within such other period (i) As the Commission may

designate up to 90 days of such date if it finds such longer period to

be appropriate and publishes its reasons for so finding or (ii) as to

which the self-regulatory organization consents, the Commission will:

(A) By order approve the proposed rule change, or

(B) Institute proceedings to determine whether the proposed rule

change should be disapproved.

IV. 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, 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 at the

Commission's Public Reference Section, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such filing will also be available

for inspection and copying at the principal office of the PSE. All

submissions should refer to File No. SR-PSE-94-13 and should be

submitted by August 2, 1994.

For the Commission, by the Division of Market Regulation,

pursuant to delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-16825 Filed 7-11-94; 8:45 am]

BILLING CODE 8010-01-M