Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by the American Stock Exchange LLC Relating to Rule 1006

[Federal Register Volume 64, Number 127 (Friday, July 2, 1999)]
[Notices]
[Pages 36057-36058]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16869]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-41562; File No. SR-Amex-99-22]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change by the American Stock Exchange 
LLC Relating to Rule 1006

June 25, 1999.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on June 22, 1999, the 
American Stock Exchange LLC (``Amex'' or ``Exchange'') filed with the 
Securities and Exchange 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.
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    \1\ 15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange proposes to amend Rule 1006 which governs disclaimers 
of liability relating to the Nasdaq-100 Index. Below is the 
text of the proposed rule change. Proposed new language is italicized; 
proposed deletions are in [brackets].

Nasdaq-100 Index

    Rule 1006. The Nasdaq Stock Market, Inc. (``Nasdaq'') has licensed 
the use of the Nasdaq-100 Index for certain purposes in 
connection with trading in a particular series of Portfolio Depositary 
Receipts on the Exchange. Nasdaq and its affiliates [does] do not 
guarantee the accuracy and/or completeness of the Nasdaq-100 
Index or any data included therein. Nasdaq [and], the 
Exchange and their affiliates make no warranty, express or implied, as 
to results to be obtained by any person or entity from the use of the 
Nasdaq-100 Index or any data included therein in connection with the 
rights licensed or for any other use. Nasdaq [and], the Exchange and 
their affiliates make no express or implied warranties, and disclaim 
all warranties of merchantability or fitness for a particular purpose 
with respect to the Nasdaq-100 Index or any data included therein. 
Without limiting any of the foregoing, in no event shall Nasdaq [and], 
the Exchange and their affiliates have any liability for any lost 
profits or special, punitive, incidental, indirect, or consequential 
damages, even if notified of the possibility of such damages. In 
addition, Nasdaq [and], the Exchange and their affiliates shall have no 
liability for any damages, claims, losses or expenses caused by any 
errors or delays in calculating or disseminating the Nasdaq-100 Index.

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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On February 26, 1999,\2\ the Commission approved the listing and 
trading under Amex Rules 1000 et seq. of Nasdaq-100 
Shares,SM units of beneficial interest in the Nasdaq-100 
Index Trust, Series 1, a unit investment trust based on the 
Nasdaq-100 Index. The Commission also approved in the 
Nasdaq-100 Shares Order Amex Rule 1006, which provides for disclaimers 
of liability with respect to the Nasdaq-100 by the Nasdaq 
and the Exchange in connection with the trading of Nasdaq-100 Shares. 
This provision is similar to other Exchange rules relating to 
disclaimers of liability with respect to Portfolio Depositary Receipts 
(e.g., Amex Rule 1004 (S&P 500 Index) and Amex Rule 1005 (Dow Jones 
Indexes) as well as index options (e.g., Amex Rule 902C). The Exchange 
is amending Amex Rule 1006 to state that the disclaimers of liability, 
specified in the rule, extend to affiliates of Nasdaq and the Exchange. 
The Exchange believes that such an amendment is appropriate to clarify 
and make explicit that the disclaimers of liability specified in Amex 
Rule 1006 also apply to affiliates of Nasdaq and Amex, which include 
the National Association of Securities Dealers, Inc. and NASD 
Regulation, Inc.
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    \2\ Securities Exchange Act Release No. 41119 (February 26, 
1999), 64 FR 11510 (March 9, 1999) (``Nasdaq-100 Shares Order'').
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2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the Act 
\3\ in general and furthers the objectives of Section 6(b)(5) \4\ in 
particular in that it is 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 facilitating transactions in securities, and to 
remove impediments to and perfect the mechanism of a free and open 
market and a national market system.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

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

[[Page 36058]]

any inappropriate burden on competition.

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

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    Because the foregoing proposed rule change: (1) Does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
(3) does not become operative for 30 days from June 22, 1999, the date 
on which it is filed, and because the Exchange provided the Commission 
with written notice of its intent to file the proposed rule change at 
least five business days prior to the filing date, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6) thereunder.\5\ At any time within 60 days of the filing of the 
proposed rule change, the Commission may summarily abrogate such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in the furtherance of the purposes of the Act.\6\
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    \5\ 17 CFR 240.19b-4(f)(6) (1999).
    \6\ 15 U.S.C. 78s(b)(3)(C).
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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 Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., 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 in the 
Commission's Public Room. Copies of such filing will also be available 
for inspection and copying at the principal office of the Amex. All 
submissions should refer to the File No. SR-Amex-99-22 and should be 
submitted by July 23, 1999.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-16869 Filed 7-1-99; 8:45 am]
BILLING CODE 8010-01-M