Self-Regulatory Organizations; Notice of Filing of Proposed Rule Change by New York Stock Exchange, Inc., Relating to the Mailing of Interim Financial Statements to Shareholders

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-35092; File No. SR-NYSE-94-42]

Self-Regulatory Organizations; Notice of Filing of Proposed Rule

Change by New York Stock Exchange, Inc., Relating to the Mailing of

Interim Financial Statements to Shareholders

December 12, 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 December

1, 1994, the New York Stock Exchange, Inc. (``NYSE'' 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 NYSE is proposing amendments to Para. 203.02 of its Listed

Company Manual (the ``Manual'') regarding the mailing of interim

financial statements to shareholders of listed companies. The rule, as

amended, would state that corporations that distribute interim reports

to shareholders should distribute such reports to both registered and

beneficial shareholders.

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

Currently, the Exchange requires listed companies to publish

interim earnings statements as press reports, but does not require that

such statements also be sent to shareholders. The practices of listed

companies vary: Some companies mail these reports to all shareholders,

some mail only to registered holders, and some companies do not mail

interim reports at all.

Various groups, including the American Society of Corporate

Secretaries and the Securities Industry Association, have been

reviewing this area in an attempt to achieve some uniformity among

listed companies with respect to their dissemination of interim

earnings reports to shareholders. In balancing the benefit of requiring

that these reports be mailed to all shareholders, and the high cost of

doing so, particularly as to ``street name'' holders, a compromise

position developed. While companies would continue not to be required

to mail interim reports to shareholders, if a company did conduct such

a mailing, it was believed to be fair that such reports be mailed to

both registered and beneficial holders.

The compromise position is proposed as an amendment to Para. 203.02

of the Manual in the discussion of reporting and disclosure by listed

companies.

2. Statutory Basis

The basis under the Act for this proposed rule change is the

requirement under section 6(b)(5) that an exchange have rules that are

designed to prevent fraudulent and manipulative acts and practices, to

promote just and equitable principles of trade, to foster cooperation

and coordination with persons engaged in regulating, clearing,

settling, processing information with respect to, and facilitating

transactions in securities, to remove impediments to and perfect the

mechanism of a free and open market and a national market system, and,

in general, to protect investors and the public interest.

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

This proposed rule change does not 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

The Exchange has not solicited, and does not intend to solicit,

comments on this proposed rule change. The Exchange has not received

any unsolicited written comments from members or other interested

parties.

III. Date of Effectiveness of the Proposed Rule Change and Timing

for Commission Action

Within 55 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, DC 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, NW.,

Washington, DC 20549. Copies of such filing will also be available for

inspection and copying at the principal office of the NYSE. All

submissions should refer to File No. SR-NYSE-94-42 and should be

submitted by January 10, 1995.

For the Commission, by the Division of Market Regulation,

pursuant to delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-31206 Filed 12-19-94; 8:45 am]

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