# Self-Regulatory Organizations; Notice of Filing and Order Granting Accelerated Partial Approval to Proposed Rule Change by the National Association of Securities Dealers, Inc. To Implement, on a Pilot Basis, New Primary Nasdaq Market Maker Standards for all Nasdaq National Market Securities and To Extend the Short Sale Rule Pilot

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URL: https://www.frixlaw.com/law-library/documents/fr%3A98-8927

## Record

- **Collection:** Federal Register
- **Document type:** Notice
- **Published:** April 6, 1998
- **Citation:** 63 FR 16841

## Text

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39819; Filed No. SR-NASD-98-26]

Self-Regulatory Organizations; Notice of Filing and Order
Granting Accelerated Partial Approval to Proposed Rule Change by the
National Association of Securities Dealers, Inc. To Implement, on a
Pilot Basis, New Primary Nasdaq Market Maker Standards for all Nasdaq
National Market Securities and To Extend the Short Sale Rule Pilot

March 30, 1998.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby
given that on March 19, 1998, the National Association of Securities
Dealers, Inc. (``NASD'' or ``Association''), through its wholly-owned
subsidiary, The Nasdaq Stock Market, Inc. (``Nasdaq''), filed with the
Securities and Exchange Commission (``SEC'' or ``Commission'') the
proposed rule changes as described in Items I and II below, which Items
have been prepared by Nasdaq. On March 25, 1998, Nasdaq submitted to
the Commission Amendment No. 1 to the proposed rule changes.\3\ On
March 26, 1998, Nasdaq submitted to the Commission Amendment No. 2 to
the proposed rule changes.\4\ The Commission is publishing this notice
to solicit comments on the proposed rule change from interested
persons. As discussed below, the Commission is also granting
accelerated approval to a portion of the proposal.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Letter from Robert E. Aber, Senior Vice President and
General Counsel, Nasdaq, to Katherine A. England, Assistant
Director, Division of Market Regulation, Commission, dated March 25,
1998.
\4\ See Letter from Robert E. Aber, Senior Vice President and
General Counsel, Nasdaq, to Richard Strasser, Assistant Director,
Division of Market Regulation, Commission, dated March 26, 1998.
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change

The NASD and Nasdaq propose to amend the Primary Nasdaq Market
Maker (``PMM'') standards for all Nasdaq National Market (``NNM'')
securities, which are found in NASD Rule 4612, and to implement the
proposed revised PMM standards on a pilot basis beginning on May 1,
1998, and extending until November 1, 1998. Additionally, the NASD and
Nasdaq are proposing to: 1) continue the current

[[Page 16842]]

suspension of existing PMM standards through May 1, 1998 (the start
date of the new PMM pilot); and 2) extend the pilot of the NASD's short
sale rule--NASD Rule 3350 (``Short Sale Rule'')--including the market
maker exemption to that rule and the definition of ``legal'' short sale
until November 1, 1998 (the end date of the proposed PMM pilot). As
noted below, as part of the PMM pilot program, the NASD and Nasdaq will
shortly submit amendments to the Short Sale Rule, which would exempt
from the Short Sale Rule certain customer facilitating, liquidity-
providing transactions, regardless of whether the broker/dealer is
qualified as a PMM. Proposed new language is italicized; proposed
deletions are in brackets.
* * * * *

NASD Rule 4612. Primary Nasdaq Market Maker Standards

(a) A member registered as a Nasdaq market maker pursuant to Rule
4611 may be deemed to be a Primary Nasdaq Market Maker in Nasdaq
National Market (``NNM'') securities if the market maker [complies
with] achieves the threshold standards [(as established and published
by the Association from time to time)] in the following qualification
criteria.
(1) [amount of time a dealer maintains a quotation that represents
the best bid or best offer as shown in] degree of liquidity
contribution to The Nasdaq Stock Market as measured by the Net
Liquidity Ratio \5\; and
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\5\ The net Liquidity Ratio (``NLR'') formula accords credit for
liquidity contribution: (1) in an ``up market'' by accumulating all
sales, irrespective of price; and (2) in a ``down market'' by
accumulating all purchases, irrespective of price. These trades are
then divided by total shares traded in both up and down markets,
excluding volume during neutral periods, sales at the inside offer
during down markets, and purchases at the inside bid during up
markets. In addition to excluding from the denominator of the NLR
sales at the inside offer during down markets and purchases at the
inside bid during up markets, these sales and purchases are excluded
from the numerator of the NLR. The result is expressed as a ratio
with a potential value between zero and one.
For the purposes of calculating NLR, the direction fo the market
is defined by looking at the five minute period prior to the trade
report. If there has been no change in the bid price during that
time, the last bid direction governs. That is, if the current best
(inside) bid displayed in The Nasdaq Stock Market is below the
preceding best (inside) bid (''down bid''), the market is deemed
down, and if the current best (inside) bid displayed in The Nasdaq
Stock Market is above the preceding best (inside) bid (``up bid''),
the market is deemed up. If there has been a change during the
previous five minutes, then the formula looks to the prior four
changes and takes the predominant direction as the indicator. Thus,
if at least three of the last four changes are down bids the market
is deemed down, and if at least three of the last four changes are
up bids the market is deemed up. If the changes are evenly split,
the market is deemed neutral.
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(2) [relation of individual dealer spread to average dealer spread]
a market maker's proportionate share of proprietary share-volume
(``proportionate volume'') or the market maker's proportionate share of
proprietary trades (``proportionate trades'').\6\ [; and
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\6\ A market maker's proportionate volume shall be determined
by: dividing the market maker's total proprietary share-volume in a
stock by all market maker proprietary share-volume for that stock;
and then multiplying that ratio by the total number of registered
market makers in the stock. For example, if a market maker transacts
10% of the total proprietary share-volume in a stock with 10
registered market makers, the market maker's proportionate volume
would be 1.0. A market maker's proportionate trades shall be
determined by: dividing the market maker's total number of
proprietary trades in a stock by the total number of proprietary
trades by all market makers in that stock; and then multiplying that
ratio by the total number of registered market makers in the stock.
Subparagraph (b)(1)(ii) establishes the applicable thresholds for
proportionate volume and proportionate trades.
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(3) frequency of dealer quotation updates without a corresponding
execution in the security occurring within three minutes before or
after a quotation update.\7\]
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\7\ [The threshold standards initially shall be established as:
(a) a market maker must maintain the best bid or best offer as
shown on Nasdaq no less than 35% of the time;
(b) a market maker must maintain a spread no greater than 102%
of the average dealer spread;
(c) no more than 50% of a market maker's quotation updates may
occur without being accompanied by a trade execution of at least one
unit of trading.
The Board of Governors reserves the authority to rescind or
modify one or more of the threshold standards immediately upon a
finding that the standard is operating in a manner that is unfair to
a class of investors or members, or that continued imposition of the
standard results in a substantial adverse impact on the liquidity or
market quality of the Nasdaq market.]
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[(b) A market maker for a Nasdaq National Market security must
satisfy the threshold standards in at least two of the criteria in
paragraph (a) in order to be designated a Primary Nasdaq Market Maker
in that security; provided however, that if a market maker satisfies
only one of the criteria, it may qualify as a Primary Nasdaq Market
Maker if it also accounts for a threshold level of proportionate volume
in the security (as established and published by the Association from
time to time.) \8\ ]
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\8\ [The threshold proportionate volume standard initially shall
require a market maker to account for volume of at least 1\1/2\
times its proportionate share of overall volume in the stock for the
review period.]
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(b)(1) Except as provided in subparagraphs (b)(2) and (b)(3), to be
designated as a Primary Nasdaq Market Maker in a particular NNM
security a market maker must achieve:
(i) the NLR threshold; and \9\
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\9\ The NLR threshold initially shall be established as 0.67.
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(ii) the threshold for proportionate volume or the threshold for
proportionate trades.\10\
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\10\ The threshold for proportionate volume and proportionate
trades shall be 1.0 for each. Accordingly, a market maker must
account for at least one times its proportionate share of all share-
volume in the stock or must account for at least one times its
proportionate share of all trades for the stock during the review
period. For example, if during the review period a stock had 10
market makers and had an overall share-volume of 1,000,000 shares
and 15,000 trades, a market maker would have to transact one-tenth
of all share-volume or trades--100,000 in share-volume or 1,500
trades.
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(b)(2) If less than 50% of all registered market makers qualify as
Primary Nasdaq Market Makers under subparagraph (b)(1), Nasdaq shall
rank those market makers that achieve only the NLR threshold by:
(i) the market makers' proportionate volume, and shall designate
(from highest to lowest ranked) such market makers as Primary Nasdaq
Market Makers until the total number of market makers qualifying under
subparagraphs (b)(1) and (b)(2)(i) reaches an amount up to but not
exceeding 50% of all the registered market makers in that security; and
(ii) the market makers' proportionate trades, and shall designate
(from highest to lowest ranked) such market makers as Primary Nasdaq
Market Makers until the total number of market makers qualifying under
subparagraphs (b)(1) and (b)(2)(ii) reaches an amount up to but not
exceeding 50% of all the registered market makers in that security.\11\
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\11\ The 50% levels set forth in subparagraphs (b)(2)(i) and
(b)(2)(ii) shall be fixed and not subject to modification by Nasdaq,
so that if a market maker meets the NLR threshold and falls within
the top 50% of market makers when ranked by proportionate volume or
the top 50% of market makers when ranked by proportionate trades,
and market maker shall automatically be designated as a Primary
Nasdaq Market Maker. The only instance in which Nasdaq would
designate Primary Nasdaq Market Makers in an amount less than 50% of
all registered market makers, would be if less than 50% of the
registered market makers achieve the NLR threshold.
When there is an odd number of registered market makers in a
security, Nasdaq will round up to calculate the ``50%'' level (i.e.,
50% level = (number of market makers +1)/2).
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(b)(3) If the number of registered market makers in a NNM security
is eight (8) or fewer, a market maker shall qualify as a Primary Nasdaq
Market Maker without regard to its proportionate volume or
proportionate trades in that stock, provided it achieves the NLR
threshold.
(c) Unless otherwise provided. [T]he review period for [review of]
market maker performance in each of the

[[Page 16843]]

qualification criteria in [paragraph] subparagraphs (a), (b),
[paragraph] and (g)[(1)(B), and paragraph (g)(2)(B)(ii)] shall be one
calendar month; provided, however, that if a market maker that is a
Primary Nasdaq Market Maker would fail to maintain that status based on
the application of the applicable thresholds for a particular month,
the review period shall be that month (up to and including the last
trading day of the month) and the prior month.
(d) If, after the applicable review period, a market maker does not
satisfy the threshold standards for the criteria in [paragraph]
subparagraphs (a) and (b), the Primary Nasdaq Market Maker designation
shall be withheld commencing on the next business day following notice
of failure to [comply with] achieve the standards.
(e) Market makers may requalify for designation as a Primary Nasdaq
Market Maker by satisfying the threshold standards for the next review
period.
(f) A market maker may request reconsideration of the notice to
withhold the Primary Nasdaq Market Maker designation.
(1) Grounds for requests for reconsideration shall be limited to:
(A) system failure; or
(B) excused market maker withdrawal status [; or
(C) where a market maker failed to qualify under the criteria set
forth in paragraph (a)(3) because of activity in a related derivative
or convertible security, or activity in a security subject to
derivative pricing mechanisms, such as currency differentials with
foreign stocks.]
(2) Requests for reconsideration must be sent in writing to Nasdaq
Market Operations [within 24 hours of the determination to withhold
the Primary Nasdaq Market Maker designation].
(3) Requests for reconsideration will be reviewed by the Market
Operations Review Committee, whose decisions are final and binding on
the members.
(g) In registration situations:
(1) To register and immediately become a Primary Nasdaq Market
Maker in a Nasdaq National Market security, a member must be a Primary
Nasdaq Market Maker in 80% of the securities in which it has
registered. If the market maker is not a Primary Nasdaq Market Maker in
80% of its stocks, it may qualify as a Primary Nasdaq Market Maker in
[that stock] a particular Nasdaq National Market security if the market
maker registers in [the stock] that security as a regular Nasdaq market
maker and satisfies the qualification criteria for the next review
peirod, except that if the market maker is registered in the security
on or before the fourteenth calendar day of the month, the review
period shall be that calendar month.
(2) Notwithstanding paragraph (g)(1) above, after an offering in a
stock has been publicly announced or a registration statement has been
filed with the Securities and Exchange Commission, no market maker may
register in the stock as a Primary Nasdaq Market Maker unless it meets
the requirements set forth below:
(A) For secondary offerings:
(i) the secondary offering has become effective and the market
maker has satisfied the qualification criteria in the time period
between registering in the security and the offering becoming
effective; provided, however, that if the member is a manager or co-
manager of the underwriting syndicate for the secondary offering and it
is a [PMM] Primary Nasdaq Nasdaq National Market Maker in 80% or more
of the Nasdaq National Market securities in which it is registered, the
member is eligible to become a [PMM] Primary Nasdaq Market Maker in the
issue prior to the effective date of the secondary offering regardless
of whether the member was a registered market maker in the stock before
the announcement of the secondary offering; or
(ii) the market maker has satisfied the qualification criteria for
40 calendar days.
(B) For initial public offerings (IPOs):
(i) the market maker may register in the offering and immediately
become a Primary Nasdaq Market Maker if it is a Primary Nasdaq Market
Maker in 80% of the securities in which it has registered; provided
however, that if, at the end of the first review period, the Primary
Nasdaq Market Maker has withdrawn on an unexcused basis from the
security or has not satisfied [the qualification criteria] the
applicable thresholds, it shall not be afforded a Primary Nasdaq Market
Maker designation on any subsequent initial public offerings for the
next 10 business days; or
(ii) the market maker registers in the stock as a regular Nasdaq
market maker and satisfies the qualification criteria for the next
review period, except that if the market maker is registered in the
security on or before the fourteenth calendar day of the month, the
review period shall be that calendar month.
(C) For purposes of subparagraph (B)(i) above:
(i) an issue ceases to be an IPO once it has traded on Nasdaq for
five (5) business days; and
(ii) the applicable first review period for IPOs that come to
market during the last five (5) business days of a month is the
calender month after the month in which the IPO commenced trading on
Nasdaq.
(3) Notwithstanding subparagraph (g)(1) or (g)(2) above, after a
merger or acquisition has been publicly announced, a Primary Nasdaq
Market Maker in one of the two affected securities may immediately
register as a Primary Nasdaq Market Maker in the other merger or
acquisition security pursuant to the same-day registration procedures
in Rule 4611.
(h) [The Board of Governors may modify the threshold standards set
forth in paragraphs (a) and (b) above if it finds that maintenance of
such standards would result in an adverse impact on a class of
investors or on Nasdaq.] This rule shall be in effect beginning May 1,
1998, and remain in effect until November 1, 1998.
* * * * *

NASD Rule 3350

(a)-(k) No Changes.
(1) This Rule shall be in effect until [April 15, 1998] November 1,
1998.
* * * * *

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 NASD 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 NASD 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 NASD and Nasdaq are proposing to amend the PMM standards, as
described below, and to implement these revised PMM standards on a six-
month pilot basis beginning May 1, 1998, and continuing until November
1, 1998. The NASD and Nasdaq are also proposing to extend the current
suspension of the former PMM standards until the proposed PMM pilot
program is implemented on May 1, 1998, and to extend the pilot program
of the Short Sale Rule until November 1, 1998.

Background

On January 20, 1997, the Commission began phasing in new order
handling rules (``Order Handling Rules''), which,

[[Page 16844]]

among other things, require Nasdaq market makers to display in their
quotes customer limit orders that improve the market maker's quoted
price or size.\12\ With the implementation of the Order Handling Rules,
trading in Nasdaq migrated to a more order-driven, rather than quote-
driven, environment because market maker's now are required to reflect
customer limit orders (not only proprietary interests) in their
quotations. The implementation of the Order Handling Rules, however,
rendered the PMM standards significantly less relevant because the
criteria in NASD Rule 4612 \13\ were premised on a quote-driven market;
that is, these standards were based primarily on a market maker's
quotes in relation to the inside quote and the quotes of other market
makers, and the ratio of executions to quote changes.\14\ Accordingly,
these PMM standards were suspended from February 3, 1997, through April
1, 1998,\15\ during which time all market makers have qualified as PMMs
and have been able to avail themselves of the PMM exemption to the
NASD's short sale rule.\16\
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\12\ See Securities Exchange Act Release No. 37619A (September
6, 1996) 61 FR 48290 (September 12, 1996) (``Order Handling Rules
Adopting Release''). Specifically, the SEC adopted Rule 11Ac1-4, the
Limit Order Display Rule, which requires the display of customer
limit orders: (1) that are priced better than a market maker's
quote; or (2) that add to the size of a market maker's quote when
the market maker is at the best price in the market. Id.
\13\ Under the suspended PMM standards in NASD Rule 4612, which
this proposal seeks to continue to suspend, a Nasdaq market maker is
deemed to be a PMM if it meets two of three criteria: (1) the market
maker maintained the best bid or best offer as shown on Nasdaq no
less than 35% of the time; (2) a market maker maintained a spread no
greater than 102% of the average dealer spread (``102% test''); and
(3) no more than 50% of a market maker's quotation changes occurred
without a trade execution. In addition, if a registered market maker
meets only one of the above criteria, it nevertheless qualifies if
the market maker accounts for volume at least 1\1/2\ times its
proportionate share of overall volume in the stock.
\14\ Specifically, the implementation of the Order Handling
Rules raised the following concerns with the PMM standards in NASD
Rule 4612: (1) it became impossible to tell when market maker quote
changes were being driven by customer interests that are entered and
then subsequently canceled without any execution, thus making it
difficult for market makers to meet the 102% test; (2) the test
regarding the percentage of time in which the market maker's quote
was at the inside became less relevant because market maker quotes
were driven to an extent by customer limit orders; and (3) SOES
decrementation had a significant impact on individual market maker
quotations as they could be decreased to zero and automatically
refreshed at a designated price. See Securities Exchange Act Release
No. 38294 (February 14, 1997) 62 FR 8289 (February 24, 1997) (order
granting temporary accelerated approval of suspension of PMM
standards).
\15\ Id.; Securities Exchange Act Release No. 39198 (October 3,
1997) 62 FR 53365 (October 14, 1997) (order granting temporary
accelerated approval of continuing suspension of PMM standards until
April 1, 1998; File No. SR-NASD-97-73).
\16\ This exemption to NASD Rule 3350 allows ``qualified''
market makers (i.e., PMMs) to sell short on a down bid (i.e., when
the current bid is lower than the previous inside bid) when engaging
in bona fide market making activity. See NASD Rule 3350(c)(1).
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Since February 1997, the NASD and Nasdaq have worked to develop PMM
standards that are more meaningful in an order-driven environment and
better identify firms that are engaging in responsible market maker
activity deserving of the benefits associated with being a PMM, such as
being exempt from the short sale rule. The proposed PMM standards
reward market makers that provide meaningful liquidity to the market
based on the market makers' buying and selling activity in up and down
markets and their relative buying and selling activity (in terms of
share-volume and trading) in comparison to other market makers.
Specifically, to determine whether the market maker is a provider
of liquidity, Nasdaq applies the net liquidity ratio (``NLR'' or ``NLR
Test''). As explained below, a market maker must meet a certain
numerical threshold to be considered a provider of liquidity, and thus
``pass'' the NLR threshold. Next, Nasdaq calculates a market maker's
proportionate share of proprietary share-volume (``proportionate
volume'') and proportionate share of proprietary trades
(``proportionate trades'') \17\ in a stock, and determines whether the
market maker needs a certain numerical threshold for proportionate
volume or a certain numerical threshold for proportionate trades
(collectively, the ``Proportionality Test'').\18\ If the market maker
passes both the NLR and Proportionality Tests, the market maker
qualifies as a PMM. As further described below, the proposed rule
contains alternative approaches for stocks where the number of market
makers meeting the NLR and Proportionality Tests is less than 50% of
registered market makers and for stocks with fewer than eight
registered market makers.
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\17\ A market maker's proportionate volume shall be determined
by: dividing the market maker's total proprietary share-volume in a
stock by all market maker proprietary share-volume for that stock;
and then multiplying that ratio by the total number of registered
market makers in the stock. A market maker's proportionate trades
shall be determined by: dividing the market maker's total number of
proprietary trades in a stock by the total number of proprietary
trades by all market makers in that stock; and then multiplying that
ratio by the total number of registered market makers in the stock.
For example, if a market maker transacts 10% of the total
proprietary share-volume in a stock with 10 registered market
makers, the market maker's proportionate volume would be 1.0.
\18\ The threshold for proportionate volume and proportionate
trades shall be 1.0 for each. Accordingly, a market maker must
account for at least one time its proportionate share of all share-
volume in the stock or its proportionate share of all trades for the
stock during the review period. For example, if during the review
period a stock had 10 market makers and had an overall share-volume
of 1,000,000 shares an 15,000 trades, a market maker would have to
transact one-tenth of all share-volume or trades--100,000 in share-
volume or 1,500 trades.
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NLR Test and Proportionality Test. Under the NLR Test, Nasdaq first
determines the direction of the market (i.e., whether the market is
``up'' or ``down''),\19\ and then examines whether the market maker is
engaging in liquidity-providing activity during up and down market
periods. Specifically, a market maker will receive credit for all
proprietary purchases in down markets, and all proprietary sales during
up markets. The accumulated proprietary share-volume of these liquidity
trades is divided by the total proprietary volume traded during up and
down markets, excluding volume during neutral periods, sales at the
inside offer during down markets, and purchases at the inside bid
during up markets.\20\ The NASD and Nasdaq believe that these trades
demonstrate a positive liquidity contribution to the market; that is,
the market maker is providing liquidity and market stabilization by
buying during down markets (when there is significant selling
interest), and by selling in up markets (when there is significant
buying interest). The resulting number provides an NLR with a potential
value between 0 an 1. An NLR of 1.0, for example, indicates that each
transaction was done in a liquidity-providing, stabilizing manner.
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\19\ For the purposes of calculating NLR, the direction of the
market is defined by looking at the five minute period prior to the
trade report. If there has been no change in the bid price during
that time, the last bid direction governs. That is, if the current
best (inside) bid displayed in Nasdaq is below the preceding best
(inside) bid (``down bid''), the market is deemed down. If the
current best (inside) bid displayed in Nasdaq is above the preceding
best (inside) bid (``up bid''), the market is deemed up. If there
has been a change during the previous five minutes, then the formula
looks to the prior four changes and takes the predominant direction
as the indicator. Thus, if at least three of the last four changes
are down bids the market is deemed down. If at least three of the
last four changes are up bids the market is deemed up. If the
changes are evenly split, the market is deemed neutral.
\20\ These trades are included neither in the equation's
numerator nor the equation's denominator because they do not clearly
demonstrate that the market maker is providing stabilizing liquidity
to the market. Because these trades are eliminated from the
equation, they count neither for nor against a market maker in
calculating the market maker's NLR.
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After the NLR is calculated, Nasdaq applies the Proportionality
Test and examines whether the market maker transacts either its
proportionate volume or its proportionate trades for the

[[Page 16845]]

security at issue. The Proportionality Test recognizes that market
makers may add to liquidity by effecting specified levels of share-
volume or trades. Similarly, this test takes into account situations in
which a stock may have a few lead market makers that transact a large
percentage of the share-volume (thus providing liquidity), but also may
have other market makers that effect a fair share of trades--but a
comparatively lower percentage of share-volume--in the stock (thus also
providing liquidity).\21\ A market maker automatically will qualify as
a PMM in a particular stock if the market maker: (1) passes the NLR
Test by achieving a liquidity ratio of 0.67 or greater; and (2) passes
the Proportionality Test by transacting either the market maker's
proportionate volume or proportionate trades.
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\21\ For example, Stock X has 12 market makers. Market makers
ABCD and EFGH attract a large percentage of order flow from
institutions and account for 30% of the share-volume, but only 15
percent of the trades in the stock. Market makers QRST and UVWX
attract a high percent of retail order flow and thus account for 30%
of the trades, but account only for 15% of the share-volume of the
stock. Each of these market makers provides liquidity to the market,
and each would receive credit under the formula.
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50% Analysis. If after the application of the NLR and
Proportionality Tests, the number of firms earning PMM status is less
than 50% of all registered market makers in a stock, Nasdaq will
augment the number of PMMs using the following method. If there are
market makers that meet the NLR Test but not the Proportionality Test
(``Remaining Market Makers''), Nasdaq will calculate the number of
market makers that will bring the total number of PMMs to 50% of all
registered market makers in the stock.\22\ (If there are no market
makers that meet the NLR, Nasdaq will not apply the ``50% Analysis''
and will not augment the number of PMMs.) Nasdaq then will rank these
Remaining Market Makers by proportionate volume, and will designate
(from highest to lowest ranked) the Remaining Market Makers as PMMs
until the total number of PMMs (i.e., those market makers that meet
both the NLR and Proportionality Tests an the top-ranked Remaining
Market Makers by proportionate volume) reaches a number not more than
50% of all registered market makers.\23\ Nasdaq also will rank the
Remaining Market Makers by proportionate trades, and will designate
these Remaining Market Makers as PMMs until the total number of PMMs
(i.e., those market makers that meet both the NLR and Proportionality
Tests and the top-ranked Remaining Market Makers by proportionate
trades) reaches a number not more than 50% of all registered market
makers.\24\
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\22\ For example, if Stock Q has 24 market makers, and 9 meet
the NLR and Proportionality tests, there would be 3 open slots which
could be filled when the Remaining Market Makers were ranked by
volume and then by trades.
\23\ The 50% levels shall be fixed and not subject to
modification by Nasdaq, so that if a market maker meets the NLR
threshold and falls within the top 50% of market makers when ranked
by proportionate volume or the top 50%of market makers when ranked
by proportionate trades, the market maker automatically shall be
designated as a PMM. The only instance in which Nasdaq would
designate PMMs in an amount less than 50% of all registered market
makers, would be if less than 50% of the registered market makers
achieve the NLR.
\24\ Under the 50% Analysis, the group of market makers
designated as PMMs by volume and then by trades may not be the same,
and thus the final number of PMMs may be more than 50% of the total
number of market makers. Conversely, the number of PMMs may be less
than 50% of all market makers because all PMMs must meet the NLR
threshold. For example, Stock Q has 24 market makers, and 9 market
makers are PMMs because they meet both the NLR and the
Proportionality Test. If no other market maker (aside from the 9
PMMs) meet the NLR threshold, no other market makers will be
designated as PMMs. If there are 3 or more market makers that meet
the NLR, then these Remaining Market makers will be ranked by
proportionate volume and then by proportionate trades and the top 3
from each of these two groups (which may or may not overlap in
identity) will be designated as PMMs.
---------------------------------------------------------------------------

Securities with Eight or Fewer Market Makers. If the number of
market makers in a particular NNM security is eight or fewer, a market
maker will earn PMM status by satisfying the NLR threshold only. Thus,
for stocks with eight or fewer market makers, Nasdaq will consider
neither volume nor trades in determining PMM status. The NASD and
Nasdaq believe that this approach is appropriate because it makes the
PMM status more attainable in these circumstances and gives firms an
incentive to make markets in smaller or less widely-covered securities.
One Month Look-Back Provision. Proposed NASD Rule 4612 generally
provides that a market maker may qualify as a PMM for a particular
stock if the market maker meets the applicable thresholds for the
particular stock during the review period, which generally is one
calendar month. The proposed rule, however, contains a one-month
``look-back'' provision. Under this provision, Nasdaq will consider the
previous calendar month and the current month to determine a market
maker's continued PMM eligibility if the market maker attained PMM
status in a security during the previous month, but fails to meet the
applicable thresholds for the current month. Specifically, if a market
maker that is a PPM fails to meet the applicable thresholds during a
given month (and thus would lose its PMM status for the next month)
Nasdaq will: (1) calculate the market maker's NLR and proportionate
volume and trade levels for the month in question (using trade data up
to and including the last trading day of the month) and the prior
month; and (2) use these figures to determine if the market maker meets
the PMM thresholds. Thus, a market maker will retain its PMM status if,
based on the NLR and proportionate trade and volume numbers for the
month at issue and the previous month, the market maker meets the
applicable PMM thresholds.\25\ In effect, this retains the requirement
that a market maker earn PPM status on a stock-by-stock basis, but
provides some flexibility in that short-term fluctuations or anomalies
in a market maker's performance are smoothed out over a longer period.
---------------------------------------------------------------------------

\25\ Similar to the previous PMM standards, if the market maker
meets the PMM thresholds for the applicable review period, Nasdaq
will append a ``P'' next to the market maker's identification symbol
on the Nasdaq WorkStation beginning the first day of the next month.
Additionally, if a PMM fails to meet the thresholds for the
applicable review period, Nasdaq will notify the PMM of such failure
and remove the ``P'' designation on the next business day following
notification.
---------------------------------------------------------------------------

Timing For Implementation of New PMM Standards. As proposed, the
new PMM standards will become effective May 1, 1998. The NASD and
Nasdaq note that currently all market makers registered in a security
are PMMs due to the suspension of previous PMM standards, and will
continue to be so designated on the pilot's proposed start date of May
1, 1998. The NASD and Nasdaq recognize that once the pilot begins on
May 1, 1998, PMMs will not have the ability to avail themselves of the
one-month look-back provision because there will be no meaningful
trading to analyze prior to May 1, 1998. Thus, in order to give PMMs
the full benefit of the one-month look-back period and to allow market
makers time to adjust their trading activity to the new standards, the
NASD and Nasdaq propose to implement the new standards so that no
market maker that is designated as a PMM when the pilot begins on May
1, 1998, will lose its PMM status--based on a failure to meet the new
PMM standards--until July 6, 1998. The NASD and Nasdaq believe that it
is fair to give market makers this time to adjust their training
activity before they lose their PMM designation, particularly since PMM
standards have been suspended for more than a year and since the new
PMMs are more stringent than the previous standards.\26\
---------------------------------------------------------------------------

\26\ Subparagraph (f) of NASD Rule 4612 permits market makers to
request reconsideration of a notice to withhold PMM designation
based on a market maker's excused with drawal status. The NASD and
Nasdaq note that the rules governing withdrawals from market making
(i.e., NASD rules 4619-4620, and 4730) recently were amended. See
Securities Exchange Act Release No. 39423 (December 10, 1997) 62 FR
66160 (December 17, 1997). Furthermore, the NASD and Nasdaq recently
submitted a rule proposal (SR-NASD-98-17) to implement a new older
delivery and execution system to replace SelectNet and SOES. See
Securities Exchange Act Release No. 39718 (March 4, 1998) 63 FR
12124 (March 12, 1998). If approved, this proposal also would amend
the procedures relating to withdrawal for ``SOES-ed out of the box''
situations.

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[[Page 16846]]

Examples of Operation of Proposed PMM Standards. Below are examples
---------------------------------------------------------------------------
of how the proposed new PMM standards will operate:

Example 1. Stock WXYZ has six market makers. Four market makers
achieve an NLR of at least .67 or above. Because WXYZ has less than
eight market makers, all four of the market makers with an NLR of at
least .67 will be designated as PMMs, regardless of their volume or
trades.
Example 2. Stock ABCD has 20 market makers; 11 market makers
achieve an NLR of at least .67 or above. Of those 11 market makers,
six transact at least their proportional level of share-volume or
trades. These six market makers automatically are designated as
PMMS. Because the number of market makers that meet both the NLR and
Proportionality Tests is less than 50% of the total number of
registered market makers in ABCD, Nasdaq will rank the remaining
market makers that have an NLR of at least .67 (five in total)
according to their proportionate level of share-volume. The top for
qualify, yielding a total of 10 PPMs (i.e., 50% of the total number
of market makers). Next, the same five market makers are ranked
according to the proportionate level of trades and the top four are
designated as PMMs. In this example, the four market makers chosen
by ranking by proportionate volume and the four market makers chosen
by ranking by proportionate trades are the same. Thus, the final
number of PMMs is 10, or 50% of the total number of registered
market makers.

----------------------------------------------------------------------------------------------------------------
Proportionate Proportionate
Market makers in stock ABCD NLR volume trades PMM?
----------------------------------------------------------------------------------------------------------------
Market Maker 1............................ .76 3.80 0.88 YES.
Market Maker 2............................ .78 1.58 1.07 YES.
Market Maker 3............................ .83 1.17 1.00 YES.
Market Maker 4............................ .81 0.80 1.48 YES.
Market Maker 5............................ .84 0.79 1.41 YES.
Market Maker 6............................ .82 0.97 1.01 YES.
Market Maker 7............................ .80 0.98 0.84 YES.
Market Maker 8............................ .87 0.65 0.61 YES.
Market Maker 9............................ .79 0.54 0.94 YES.
Market Maker 10........................... .85 0.51 0.69 YES.
Market Maker 11........................... .80 0.16 0.24 NO.
Market Maker 12........................... .65 3.94 2.83 NO.
Market Maker 13........................... .66 0.83 1.84 NO.
Market Maker 14........................... .65 0.67 0.94 NO.
Market Maker 15........................... .64 0.51 0.93 NO.
Market Maker 16........................... .61 0.41 0.84 NO.
Market Maker 17........................... .61 0.40 0.49 NO.
Market Maker 18........................... .58 0.70 0.95 NO.
Market Maker 19........................... .51 0.16 0.24 NO.
Market Maker 20........................... .48 0.01 0.02 NO.
----------------------------------------------------------------------------------------------------------------

Example 3. Stock IJKL has 19 market makers; 11 market makers
have an NLR of .67 or better. Of those 11 market makers, six
transact at least their proportional level of share-volume or
trades. These six market makers automatically are designated as
PMMs. Because the number of market makers that meet both the NLR and
Proportionality Tests is less than 50% of the total number of
registered market makers in IJKL, Nasdaq will rank the remaining
market makers that have an NLR of at least .67 (five in total)
according to their proportionate level of share-volume. The top four
are designated as PMMs, thus yielding a total of 10 PMMs.\27\ Next,
the same five market makers are ranked according to their
proportionate level of trades and the top four are designated as
PMMs, thus yielding a total of 10 PMMs. Unlike Example 2, the four
market makers chosen by ranking by proportionate volume and the four
market makers chosen by ranking by proportionate trades are not the
same. Three of the four market makers (i.e., market makers 7, 8, and
9, listed below) are the same; market maker 10, however, is
designated as a PMM according to its proportionate volume and market
maker 11 is designated a PMM according to its proportionate trades.
Thus, the final number of PMMs is 11, or 55% of the total number of
registered market makers.
---------------------------------------------------------------------------

\27\ This example illustrates that when there is an odd number
of registered market makers, Nasdaq rounds up to calculate the
``50%'' level (i.e., 50% level = (number of market makers + 1)/2).
That is, in example 3 where there are 19 registered market makers,
Nasdaq would round up and would have 10 possible PMM slots when
ranking by proportionate volume and would have 10 possible slots
when ranking by proportionate trades (i.e., (19 + 1)/2 = 10).

----------------------------------------------------------------------------------------------------------------
Proportionate Proportionate
Market makers in stock IJKL NLR volume trades PMM?
----------------------------------------------------------------------------------------------------------------
Market Maker 1............................ .76 3.80 0.88 YES.
Market Maker 2............................ .78 1.58 1.07 YES.
Market Maker 3............................ .83 1.17 1.00 YES.
Market Maker 4............................ .81 0.80 1.48 YES.
Market Maker 5............................ .84 0.79 1.41 YES.
Market Maker 6............................ .82 0.97 1.01 YES.
Market Maker 7............................ .80 0.98 0.84 YES.
Market Maker 8............................ .87 0.65 0.61 YES.
Market Maker 9............................ .79 0.54 0.94 YES.
Market Maker 10........................... .85 0.51 0.24 YES.
Market Maker 11........................... .80 0.16 0.31 YES.

[[Page 16847]]

Market Maker 12........................... .65 3.94 2.83 NO.
Market Maker 13........................... .66 0.83 1.84 NO.
Market Maker 14........................... .65 0.67 0.94 NO.
Market Maker 15........................... .64 0.51 0.93 NO.
Market Maker 16........................... .61 0.41 0.84 NO.
Market Maker 17........................... .61 0.40 0.49 NO.
Market Maker 18........................... .58 0.70 0.95 NO.
Market Maker 19........................... .51 0.16 0.24 NO.
----------------------------------------------------------------------------------------------------------------

Example 4. Stock EFGH has 18 market makers. Six of the 18 market
makers meet both the NLR and Proportionality Tests. These six market
markers automatically are designated as PMM. Because less than 50%
of the total number of registered market makers in EFGH qualify as
PMMs, Nasdaq would augment this number of the ranking process.
Since, however, Market Maker 7 is the only remaining market maker
that meets the NLR, only Market Maker 7 will be designated as a PMM.
Thus, only 7 (or 38.9%) of the 18 registered market makers qualify
as PMMs.

----------------------------------------------------------------------------------------------------------------
Proportionate Proportionate
Market makers in stock EFGH NLR volume trades PMM?
----------------------------------------------------------------------------------------------------------------
Market Maker 1............................ .76 3.80 0.88 YES.
Market Maker 2............................ .68 1.58 1.07 YES.
Market Maker 3............................ .73 1.17 1.00 YES.
Market Maker 4............................ .71 1.00 1.48 YES.
Market Maker 5............................ .84 1.02 1.41 YES.
Market Maker 6............................ .72 1.21 1.01 YES.
Market Maker 7............................ .67 0.91 0.84 YES.
Market Maker 8............................ .66 0.65 1.01 NO.
Market Maker 9............................ .65 0.54 0.94 NO.
Market Maker 10........................... .65 0.51 0.69 NO.
Market Maker 11........................... .65 0.16 0.24 NO.
Market Maker 12........................... .65 3.94 2.83 NO.
Market Maker 13........................... .65 0.83 1.84 NO.
Market Maker 14........................... .65 0.67 0.94 NO.
Market Maker 15........................... .64 0.51 0.93 NO.
Market Maker 16........................... .61 0.41 0.84 NO.
Market Maker 17........................... .61 0.40 0.49 NO.
Market Maker 18........................... .58 0.70 0.95 NO.
----------------------------------------------------------------------------------------------------------------

* * * * *

Extension of Suspension of Existing PMM and Extension of Short Sale
Rule

In addition to proposing new PMM standards, the NASD and Nasdaq are
proposing to extend the current suspension of the presently suspended
PMM standards until the proposed PMM pilot program is implemented on
May 1, 1998. This extension will allow for continuity in the market
until the new PMM standards are phased in.
Additionally, as explained below, the NASD and Nasdaq are proposing
to extend until November 1, 1998, the pilot of the Short Sale Rule
including the market maker exemption to that rule and the amended
definition of legal short sale.\28\ The Short Sale Rule has been
operating on a pilot basis since June 29, 1994,\29\ and most recently
was extended until April 15, 1998.\30\ On August 8, 1997, the NASD and
Nasdaq submitted a proposal to implement the Short Sale Rule on a
permanent basis.\31\ Subsequent to submitting this request, the
Commission instructed the NASD and Nasdaq that it would not determine
whether to implement the Short Sale Rule on a permanent basis until
more meaningful PMM standards were developed and implemented. In
response, the NASD and Nasdaq have proposed the standards described in
this filing. Furthermore, the NASD and Nasdaq anticipate that under the
proposed PMM standards, the number of market makers qualifying for PMM
status will be reduced significantly from the levels under previous PMM
standards. In order to minimize any unintended consequence of the more
stringent PMM standards--such as restricting market makers from
``facilitating'' customer orders or broker/dealers from executing
riskless principal transactions (and effectively acting as agent) when
they have a net short position--the NASD and Nasdaq shortly will file a
rule proposal to amend the Short Sale Rule to provide all market makers
(not only PMMs) with an exemption to the Short Sale Rule to engage in
customer-facilitating, liquidity-providing transactions.
---------------------------------------------------------------------------

\28\ The definition of ``legal'' short sale was amended on a
pilot basis on September 26, 1997, and has been extended
commensurate with the subsequent extensions of the Short Sale Rule
pilot. See Securities Exchange Act Release No. 39139 (September 26,
1997) 62 FR 52169 (October 6, 1997) (initial temporary approval
order for amendment to ``legal'' short sale); Securities Exchange
Act Release No. 39551 (January 14, 1998) 63 FR 3370 (January 22,
1998) (extending amended legal short sale definition until April 15,
1998).This amendment provides that a ``legal'' short sale can be
effected on a down bid: at a price of 1/16th above the bid when the
inside spread is 1/16th or greater; or at a price equal to or
greater than the offer price when the inside spread is less than 1/
16th.
\29\ See Securities Exchange Act Release No. 34277 (June 29,
1994) 59 FR 34885 (July 7, 1994) (``Short Sale Rule Approval
Order'').
\30\ See Securities Exchange Act Release No. 39551 (January 14,
1998) 63 FR 3370 (January 22, 1998).
\31\ See Securities Exchange Act Release No. 38979 (August 26,
1997) 62 FR 46537 (September 3, 1997).
---------------------------------------------------------------------------

Accordingly, an extension of the Short Sale Rule is necessary to
allow the NASD and Nasdaq to study the effects of the revised PMMs and
the soon-to-be filed amendments to the Short Sale Rule, and to study
the interaction between the revised PMM standards and

[[Page 16848]]

the Short Sale Rule. At the end of the PMM pilot, it is expected that
the NASD, Nasdaq, and the Commission will be in a better position to
evaluate the efficacy of the revised PMM standards and to evaluate the
proposal to permanently approve the Short Sale Rule.

Statutory Basis

The NASD and Nasdaq believe that the proposed rule change is
consistent with Sections 15A(b)(6) and 11A(a)(1)(C) of the Exchange
Act. Among other things, Section 15A(b)(6) requires that the rules of a
national securities association be 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. Section 11A(a)(1)(C)
provides that it is in the public interest and appropriate for the
maintenance of fair and orderly markets to, among other things, assure
the economically efficient execution of securities transactions and the
availability to brokers, dealers, and investors of information with
respect to quotations for and transactions in securities, and to assure
fair competition among brokers and dealers.
Specifically, the NASD and Nasdaq believe that the proposed PMM
standards provide a meaningful measure of whether a market maker is
providing liquidity to the market and thus deserving of an exemption to
the NASD's Short Sale Rule. Furthermore, by sufficiently restricting
the number of market makers that may qualify for PMM status, the
proposed standards foster competition among market makers and benefit
investors. Similarly, the proposal protects investors by limiting the
number of market makers that may sell short only to those who regularly
effect liquidity-providing and stabilizing transactions. Furthermore,
the temporary extension of the suspension of the presently suspended
PMM standards until the new standards are in place and an extension of
the pilot of the Short Sale Rule should provide market makers with
certainty regarding whether they are entitled to an exemption under the
rule and continuity of short sale regulation, thus promoting market
efficiency and orderly markets during a transition period. The proposal
should also help in reducing investor confusion at this time and
thereby promote efficient and fair markets.

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

The NASD and Nasdaq believe that the proposed rule change will not
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Exchange Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

Comments were neither solicited nor received.

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 reasons for so finding or (ii) as to
which the NASD 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.
The NASD and Nasdaq have requested that the Commission find good
cause pursuant to Section 19(b)(2) for approving the extended
suspension of the current PMM standards and the extension of the Short
Sale Rule pilot prior to the 30th day after publication in the Federal
Register. For the reasons discussed in Item V below, the Commission
grants accelerated partial approval for these portions of the proposal.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Exchange 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. 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 available for inspection and copying at the
principal office of the NASD. All submissions should refer to File No.
SR-NASD-98-26 and should be submitted by April 27, 1998.

V. Commission's Findings and Order Granting Accelerated Partial
Approval of the Proposed Rule Change

After careful consideration, the Commission has concluded, for the
reasons set forth below, that the extension of the Short Sale Rule
pilot until November 1, 1998, and the extension of the current
suspension of existing PMM standards through May 1, 1998, are
consistent with the requirements of the Exchange Act and the rules and
regulations applicable to the NASD. In particular, these extensions
conform with the requirements of Section 15A(b)(6) \32\ of the Exchange
Act and the rules and regulations thereunder. Pursuant to Section
15A(b)(6), the NASD's rules must be designed, among other things, to
prevent fraudulent and manipulative acts and practices and to promote
just and equitable principles of trade. The Commission believes that
these portions of the proposal are consistent with Section 15A(b)(6) of
the Exchange Act because extension of the Short Sale Rule pilot and
continued suspension of the current PMM standards will maintain the
status quo while the Commission and the NASD review the operation of
the pilot program for new PMM standards. It is not unreasonable to
maintain the NASD's Short Sale Rule for a further short period while
the Commission evaluates the effect of new PMM standards on market
maker behavior and use of the short sale exemption. Thus, because the
Commission's ultimate stance on the Short Sale Rule may be affected, in
part, by the operation of the proposed new PMM standards, it is
reasonable to keep the Short Sale Rule in place while the pilot for new
PPM standards commences. Furthermore, it is judicious, in the short
term, to avoid reintroducing existing, potentially outdated PMM
standards prior to the implementation of a new PMM pilot.
---------------------------------------------------------------------------

\32\ 15 U.S.C. 78o-3(b)6).
---------------------------------------------------------------------------

In finding that the extensions of the Short Sale Rule pilot and the
suspension of the existing PMM standards are consistent with the
Exchange Act, the Commission reserves judgment on the merits of the
Short Sale

[[Page 16849]]

Rule, any market maker exemptions, and the proposed new PMM standards.
The Commission recognizes that the current Short Sale Rule already has
generated significant public comment. Such commentary, along with any
further comment on the interaction of the Short Sale Rule with the
proposed new PMM standards, will help guide the Commission's evaluation
of the Short Sale Rule and new PMM standards. Moreover, during this
period, the Commission anticipates that the NASD will continue to
address the Commission's questions and concerns and provide the
Commission staff with additional information about the practical
effects and the operation of the revised PMM standards and possible
interaction between those standards and the NASD's Short Sale Rule.
The Commission finds good cause for approving the extension of the
Short Sale Pilot and the extension of the suspension of existing PMM
standards prior to the 30th day after the date of publication of notice
of filing thereof. The Short Sale Rule has been in place since
September 6, 1994, and the Commission is only extending it for six and
a half months in order to evaluate its interaction with new PMM
standards. In addition, as noted above, it could be disruptive to
market making to reintroduce outdated PMM standards for a brief period
prior to implementation of a new PMM pilot.
It Is Therefore Ordered, pursuant to Section 19(b)(2) of the
Exchange Act,\33\ that the portion of the proposed rule change (File
No. SR-NASD-98-26) containing the extension of the NASD's Short Sale
Rule pilot until November 1, 1998, and the suspension of existing PMM
standards until May 1, 1998, is hereby approved on an accelerated
basis.\34\
---------------------------------------------------------------------------

\33\ 15 U.S.C. 78s(b)(2).
\34\ In approving this portion of the proposed rule change, the
Commission has considered the proposed rule's impact on efficiency,
competition, and capital formation. 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

For the Commission, by the division of Market Regulation, pursuant
to delegated authority.\35\
---------------------------------------------------------------------------

\35\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-8927 Filed 4-3-98; 8:45 am]
BILLING CODE 8010-01-M

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A98-8927. Public record. Not legal advice.