[Federal Register: November 8, 1999 (Volume 64, Number 215)] [Notices] [Page 60872-60873] From the Federal Register Online via GPO Access [wais.access.gpo.gov] [DOCID:fr08no99-123] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-42087; File No. SR-NYSE-99-29] Self-Regulatory Organizations; Notice of Filing and Order Granting Accelerated Approval to Amendment No. 2 to a Proposed Rule Change by the New York Stock Exchange, Inc. Extending a Pilot Program Relating to Continued Listing Standards Through December 1, 1999 November 1, 1999. 1. Introduction On June 22, 1999, the New York Stock Exchange, Inc. (``NYSE'' or ``Exchange''), filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to amend Section 8 of its Listed Company Manual (``Manual''), make corresponding changes to NYSE Rule 499, and implement the proposed changes pursuant to a pilot program (``pilot''). On July 26, 1999, the Commission issued notice of the filing and approved, on an accelerated basis, the portion of the filing establishing a pilot through November 1, 1999.\3\ --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ Securities Exchange Act Release No. 41648 (July 26, 1999), 64 FR 41986 (August 2, 1999). --------------------------------------------------------------------------- On October 26, 1999, the NYSE submitted Amendment No. 1, proposing to revise the continued listing criteria applicable to closed-end investment companies (``Funds').\4\ On November 1, 1999, the NYSE submitted Amendment No. 2, proposing to extend the pilot until December 1, 1999, or such earlier time as the Commission approves the Exchange's request for permanent approval of the program.\5\ The Commission is publishing this notice to solicit comments on and grant accelerated approval to Amendment No. 2. --------------------------------------------------------------------------- \4\ See Letter from James E. Buck, Senior Vice President and Secretary, NYSE, to Richard C. Strasser, Assistant Director, Division of Market Regulation, SEC, dated October 25, 1999. \5\ See Letter from James E. Buck, Senior Vice President and Secretary, NYSE, to Jonathan Katz, Secretary, SEC, dated November 1, 1999. --------------------------------------------------------------------------- II. Proposed Rule Change In Amendment No. 2, the NYSE is proposing to extend the pilot which amends Section 8 of the NYSE Manual and makes corresponding changes to NYSE Rule 499 regarding criteria governing the continued listing of securities. The proposed rule change [[Page 60873]] implemented pursuant to the pilot modifies several of the NYSE's existing continued listing criteria, codifies certain Exchange policies regarding the NYSE's continued listing criteria, replaces certain of the current criteria with new continued listing criteria, and creates subsections in the continued listing section.\6\ --------------------------------------------------------------------------- \6\ See Securities Exchange Act Release No. 41648, supra note 3. --------------------------------------------------------------------------- III. Discussion After careful consideration, the Commission has concluded, for the reasons set forth below, that the extension of the pilot until December 1, 1999, or such earlier time as the Commission takes final action on the Exchange's request for permanent approval of the pilot, is consistent with the requirements of the Act and the rules and regulations thereunder. In particular, the extension is consistent with Section 6(b)(5) \7\ requirements that the rules of an exchange be designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanisms of a free and open market and a national market system, and, in general, to protect investors and the public. The Commission believes that continuation of the pilot will maintain the status quo while the Commission and the Exchange review the proposed changes to the continued listing criteria, including Amendment No. 1. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Commission finds good cause for approving the extension of the pilot prior to the 30th day after the date of publication of notice of the filing in the Federal Register. It could be disruptive to the NYSE market and confusing to market participants to reintroduce the previous continued listing criteria for, potentially, a brief period while the Commission considers the request for permanent approval of the pilot.\8\ Additionally, a lapse in the pilot could affect companies whose position is precariously balanced between listing and delisting depending on whether the proposed continued listing criteria are approved. This is particularly true of Funds, which could be subject to the original continued listing criteria, the criteria proposed and implemented in the pilot, or the criteria proposed in Amendment No. 1. --------------------------------------------------------------------------- \8\ The Commission's approval of the pilot should not be interpreted as suggesting that the Commission is predisposed to approving the proposal on a permanent basis. --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning Amendment No. 2, including whether the proposed amendment is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, DC 20549-0609. 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 Room. Copies of such filing will also be available for inspection and copying at the principal office of the Exchange. All submissions should refer to File No. SR-NYSE-99-29 and should be submitted by November 29, 1999. V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,\9\ that Amendment No. 2 to the proposed rule change (SR-NYSE-99- 29), which extends the pilot to December 1, 1999, or such earlier time as the Commission takes final action on the Exchange's request for permanent approval of the program, is hereby approved on an accelerated basis.\10\ --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(2). \10\ In approving Amendment No. 2, the Commission has considered its 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.\11\ --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Margaret H. McFarland, Deputy Secretary. [FR Doc. 99-29160 Filed 11-5-99; 8:45 am] BILLING CODE 8010-01-M