Self-Regulatory Organizations; Filing of Proposed Rule Change by the Philadelphia Stock Exchange, Inc., Relating to Excessive Trading

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-33804; File No. SR-PHLX-93-51]

Self-Regulatory Organizations; Filing of Proposed Rule Change by

the Philadelphia Stock Exchange, Inc., Relating to Excessive Trading

March 22, 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

30, 1993, the Philadelphia Stock Exchange, Inc. (``PHLX'' or

``Exchange'') filed with the Securities and Exchange Commission

(``SEC'' or ``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 Term of

Substance of the Proposed Rule Change

Currently, PHLX rule 771, ``Excessive Trading of Members,''

prohibits a member from effecting purchases or sales on the Exchange

which are excessive in view of his or its financial resources or in

view of the market for such security. The PHLX proposes to amend PHLX

rule 771 by deleting the phrase ``or in view of the market for such

security.'' PHLX rule 1015, ``Excessive Dealing in Options,'' prohibits

a member from effecting purchases or sales in options which are

excessive in view of his financial resources or in view of the market

for such security. The PHLX proposes to amend PHLX rule 1015 by

deleting the phrase ``in view of his financial resources'' and by

renumbering the rule as PHLX rule 1021.

The text of the proposed rule change is available at the Office of

the Secretary, PHLX, 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, 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

The PHLX proposes to amend PHLX rule 771 and to amend and renumber

Exchange rule 1015 as PHLX rule 1021. Specifically, the PHLX proposes

to amend PHLX rule 771, which is located among the financial

responsibility rules, to delete the phrase ``or in view of the market

for such security.'' The PHLX states that this phrase is already

appropriately included in PHLX rule 1015, which in turn would be

amended to delete the reference to the financial resources of a member,

because this phrase is already appropriately included in Exchange rule

771. The PHLX indicates that the financial responsibility reference

included in the trade practice rule (PHLX rule 1015) was recently the

source of confusion, which will be corrected by the PHLX's proposal.

Specifically, under the proposed rule change, PHLX rule 771 will govern

the financial aspect of excessive trading and PHLX rule 1021 will

govern the trade practice aspect.

The Exchange believes that the proposed rule change is consistent

with section 6 of the Act, in general, and, in particular with section

6(b)(5), in that it is designed to prevent fraudulent and manipulative

acts and practices, as well as to protect investors and the public

interest.

(B) Self-Regulatory Organization's Statement on Burden on Competition

The PHLX does not believe that the proposed rule change will impose

any inappropriate burden on competition.

(C) Self-Regulatory Organizations' Statement on Comments on the

Proposed Rule Change Received From Members, Participants or Others

No written comments were either received or requested.

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

for Commission Action

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

Federal Register or within such longer 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 reason for so finding or (ii) as to

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

(a) By order approve such 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 Copies of such filing will also be available for

inspection and copying at the principal office of the above-mentioned

self-regulatory organization. All submissions should refer to the file

number in the caption above and should be submitted by April 19, 1994.

For the Commission, by the Division of Market Regulation,

pursuant to delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-7288 Filed 3-38-94; 8:45 am]

BILLING CODE 8010-01-M