Delegation of Authority to Director of Division of Market Regulation

SECURITIES AND EXCHANGE COMMISSION 17 CFR Part 200 [Release No. 34–38111] Delegation of Authority to Director of Division of Market Regulation AGENCY: Securities and Exchange Commission. ACTION: Final rule. SUMMARY: The Commission is amending its rules to delegate authority to the Director of the Division of Market Regulation to provide exemptive relief

Federal Register / Vol. 62, No. 7 / Friday, January 10, 1997 / Rules and Regulations 1385 1Securities Exchange Act Release No. 37619A (September 6, 1996), 61 FR 48290 (‘‘Adopting Release’’). 2 17 CFR 240.11Ac1–4(d); 17 CFR 240.11Ac1– 1(d). 3 17 CFR 200.30–3. 4 5 U.S.C. 553(B)(3)(A). pursuant to the recently adopted Limit Order Display Rule (Rule 11Ac1–4(d)), and to delegate authority to delay the effective dates or compliance dates for any aspect of the implementation or operation of the Limit Order Display Rule or the recent amendments to the Quote Rule (Rule 11Ac1–1). This delegation will help to expedite and enhance the orderly implementation of the recently adopted Limited Order Display Rule and the amendments to the Quote Rule. EFFECTIVE DATE: January 2, 1997. FOR FURTHER INFORMATION CONTACT:
Betsy Prout Lefler, Special Counsel, Division of Market Regulation, 202/942– 0170. SUPPLEMENTARY INFORMATION: On August 28, 1996, the Securities and Exchange Commission adopted amendments to the Quote Rule and a new Limit Order Display Rule.1 The Limit Order Display Rule generally requires exchange specialists and OTC market makers to display customer limit orders that are at prices superior to the market maker’s or specialist’s own quote, subject to certain exceptions. The amendments to the Quote Rule, among other things, (1) require OTC market makers and exchange specialists to include in their public quotes any better prices that they have placed in certain electronic communications networks (‘‘ECN Amendments’’); (2) deems an OTC market maker or specialist in compliance with the ECN Amendment if it inputs such prices into an ECN that furnishes the best market maker and specialist prices therein to an exchange or association for inclusion in the public quotation system, and provides access to those prices equivalent to the access that would have been afforded market participants if the market maker or specialist had updated its own quote; and (3) expands the definition of ‘‘OTC market maker’’ to mean any dealer who holds itself out as being willing to buy from and sell to its customers, or otherwise, a security covered under the Quote Rule for its own account on a regular and continuous basis otherwise than on an exchange in amounts of less than block size. Both the Limit Order Display Rule and the Quote Rule contain provisions that allow the Commission to grant exemptive relief from various provisions of the rules to market participants and self-regulatory organizations.2 While the Director of the Division of Market Regulation already has delegated authority to grant exemptive relief under the Quote Rule, the present amendment to Rule 30–3 3 authorities the Director of the Division of Market Regulation to grant the exemptive the relief described in the Limit Order Display Rule. This delegation will provide flexibility to ensure orderly implementation of the recently adopted Limit Order Display Rule in instances where immediate action is necessary to ensure the protection of investors and the maintenance of fair and orderly markets. The present amendment to Rule 30–3 also authorizes the Director of the Division of Market Regulation to modify as needed the compliance dates and effective dates for operation of the Quote Rule, as amended, or of the Limit Order Display Rule. The Commission finds, in accordance with Section 553(b)(3)(A) of the Administrative Procedure Act,4 that this amendment relates solely to agency organization, procedures, or practice, and does not relate to a substantive rule. Accordingly, notice and opportunity for public comment are unnecessary, and publication of the amendment 30 days before its effective date is also unnecessary. List of Subjects in 17 CFR Part 200 Administrative practice and procedure, Authority
delegations (Government agencies). Text of Amendment For the reasons set out in the preamble, Title 17, Chapter II of the Code of Federal Regulations is amended as follows:
PART 200—ORGANIZATION;
CONDUCT AND ETHICS; AND INFORMATION AND REQUESTS

1. The authority citation for Part 200
   continues to read in part as follows:
   Authority: 15 U.S.C. 77s, 78d–1, 78d–2, 78w, 7811(d), 79t, 77sss, 80a–37, 80b–11, unless otherwise noted.

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2. Section 200.30–3 is amended by
   adding paragraphs (a)(61) and (a)(62) as follows:
   § 200.30–3 Delegation of authority to Director of Division of Market Regulations.

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(a) * * *
(61) To grant exemptions from Rule 11Ac1–4 (‘‘Rule’’) (§ 240.11Ac1–4), pursuant to paragraph (d) of the rule. (62) From January 2, 1997 through February 17, 1997, to modify for a period not to exceed 60 days, the effective date or the compliance date of Rule 11Ac1–1 (§ 240.11Ac1–1) or Rule 11Ac1–4 (§ 240.11Ac1–4), or amendments to Rule 11Ac1–1 or Rule 11Ac1–4, with respect to any party affected by such rules.

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By the Commission.
Dated: January 2, 1997.
Margaret H. McFarland, Deputy Secretary. [FR Doc. 97–620 Filed 1–9–97; 8:45 am] BILLING CODE 8010–01–M