

[Federal Register: December 5, 2005 (Volume 70, Number 232)]
[Rules and Regulations]               
[Page 72565-72571]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05de05-20]                         


[[Page 72565]]

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Part IV





Securities and Exchange Commission





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17 CFR Parts 200 and 201



Adoption of Amendments to the Rules of Practice and Related Provisions 
and Delegations of Authority of the Commission; Final Rule


[[Page 72566]]


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SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 200 and 201

[Release No. 34-52846; File No. S7-05-05]

 
Adoption of Amendments to the Rules of Practice and Related 
Provisions and Delegations of Authority of the Commission

AGENCY: Securities and Exchange Commission.

ACTION: Final rule.

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SUMMARY: The Securities and Exchange Commission (``Commission'') is 
amending its Rules of Practice, certain related provisions, and its 
delegations of authority to the staff as a result of its experience 
with these rules and to correct typographical errors and change certain 
citations. The amendments are intended to enhance the transparency and 
facilitate parties' understanding of the rules and to make practice 
under the rules easier and more efficient.

DATES: Effective January 4, 2006.

FOR FURTHER INFORMATION CONTACT: Diane V. White, Office of the General 
Counsel, (202) 551-5150, Securities and Exchange Commission, 100 F 
Street, NE., Washington, DC 20549-9010.

SUPPLEMENTARY INFORMATION: On April 21, 2005, the Commission proposed 
amendments to the Rules of Practice.\1\ The Commission proposed 
amendments to its Rules of Practice and related provisions as a result 
of the Commission's experience with its existing rules and in order to 
correct references and change certain citations. Additional amendments 
were proposed to correct typographical errors and change certain 
citations to conform to the amended rules. The majority of these 
proposals were technical and procedural.
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    \1\ Proposed Amendments to the Rules of Practice and Related 
Provisions, Exchange Act Rel. No. 51595, 70 FR 22224 (Apr. 28, 
2005).
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I. Discussion

    The Commission requested comment on the proposed amendments from 
interested persons. The Commission received no comments in response to 
its requests. The Commission is adopting the amendments to the Rules of 
Practice and related provisions, essentially as proposed.
    A. Rule 141(a)(2)(ii) now generally authorizes service on other 
corporations or entities by delivering a copy of the order instituting 
proceedings (``OIP'') to an officer, managing or general agent, or 
authorized agent by personal service or by mail.\2\ Particularly, in 
proceedings instituted under Section 12(j) of the Securities Exchange 
Act of 1934, 15 U.S.C. 78l(j), to revoke or suspend the registration of 
a class of securities for failure to make timely periodic filings, it 
sometimes has been difficult to serve the issuer of the securities. An 
issuer that is delinquent in its filings often does not keep current 
with the Commission the name of a valid agent to receive notice of the 
proceeding. In certain instances, the Commission's staff has sought to 
accomplish service on such an issuer by serving multiple copies of the 
OIP on various persons, such as the issuer's officers or directors.\3\ 
The Commission is amending Rule 141(a)(2)(ii) to authorize service on 
an issuer at the most recent address set forth in its most recent 
filing with the Commission, with confirmation of attempted delivery.
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    \2\ Rule 141(a)(2)(ii) states that notice to a corporation or 
other entity of a proceeding ``shall be made'' by ``delivering a 
copy of the order instituting proceedings to an officer, managing or 
general agent, or any other agent authorized by appointment or by 
law to receive such notice, by any method specified in paragraph 
(a)(2)(i) of this rule.''
    Rule 141(a)(2)(i) authorizes delivery by ``handing a copy of the 
order to the individual; or leaving a copy at the individual's 
office with a clerk or other person in charge thereof; or leaving a 
copy at the individual's dwelling house or usual place of abode with 
some person of suitable age and discretion then residing therein; or 
sending a copy of the order addressed to the individual by U.S. 
Postal Service certified, registered or Express Mail and obtaining 
confirmation of receipt; or giving confirmed telegraphic notice.''
    \3\ See, e.g., Alcohol Sensors Int'l, Ltd., Exchange Act Rel. 
No. 50150 (Aug. 5, 2004), 83 SEC Docket 1748, 1749 n.1 (stating that 
more than 430 copies of the OIP were served in order to accomplish 
service on seventeen respondents in a Section 12(j) proceeding).
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    The Commission also is adopting Rule 141(a)(2)(vi) to authorize 
service on persons registered with self-regulatory organizations at the 
most recent address shown in the Central Registration Depository, with 
confirmation of attempted delivery. We requested comment as to whether 
this method would provide adequate notice of a proceeding. We recognize 
that the Central Registration Depository requires that addresses be 
kept current for only two years after a person ceases to be associated 
with a member of a self-regulatory organization. We further requested 
comment as to whether the rule should refer explicitly to such a two-
year period. However, we received no comment in response to either 
request. We have determined to adopt the amendments to the rule as 
proposed.
    B. Currently, Rule 430(a) provides that any person aggrieved by an 
action made by authority delegated in Sec. Sec.  200.30-1 through 
200.30-8 or Sec. Sec.  200.30-11 through 200.30-18 may seek review of 
the action pursuant to Rule 430(b). Rule 430(b) now provides that 
Commission review is to be sought by filing a written notice of 
intention to petition for review within five days ``after actual notice 
to the party of the action or service of notice pursuant to Sec.  
201.141(b), whichever is earlier.'' Although the current rule permits 
appeals by any aggrieved person of action taken by delegated authority, 
an aggrieved person who is not a party may not receive actual notice or 
learn of service of notice promptly after the action. Nonetheless, it 
is important that a deadline for the filing of a notice of intention to 
petition for review be established, so it is possible to know when an 
action is beyond challenge. The amendment therefore provides that both 
parties and aggrieved persons may seek Commission review of the action 
by filing a written notice of intention to petition for review within 
five days after actual notice of the action to that party or aggrieved 
person, or 15 days after publication of the notice of action in the 
Federal Register, or five days after service of notice of the action 
pursuant to Sec.  201.141(b), whichever is the earliest. The Commission 
requested comment on whether this form of publication would provide 
adequate notice, or whether another form of publication should be used 
to supplement the Federal Register. The Commission also sought comment 
on whether posting of a notice of action pursuant to delegated 
authority on the Commission's Web site would aid in giving notice to 
persons who might be aggrieved by such action. Although we received no 
comment in response to this request, the Commission intends to post, as 
appropriate, delegated actions on its Web site.\4\ The Commission also 
requested comment as to whether 15 days after publication would allow 
parties and aggrieved persons sufficient time to file a notice.\5\ 
Again, we received no comment. We have determined to adopt the rule as 
proposed.
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    \4\ There are certain circumstances in which notice of an action 
taken by delegated authority will not be posted on the Commission's 
Web site or published in the Federal Register. For example, the 
Commission does not publish a delegated decision to grant or deny 
confidential treatment where the requestor has asked for 
confidential treatment for the request itself.
    \5\ See 44 U.S.C. 1508 (stating that time between publication of 
notice in Federal Register and date fixed in notice for hearing or 
termination of opportunity to be heard should generally be not less 
than fifteen days unless otherwise specifically prescribed by Act of 
Congress).
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    C. Currently, Rule 55, which governs the conduct of Equal Access to 
Justice

[[Page 72567]]

Act (``EAJA'') proceedings before an administrative law judge, 
authorizes the law judge considering an application for an award of 
fees and expenses under the EAJA, 5 U.S.C. 504, to order all 
proceedings that are otherwise available under Rule 8(d) of the Rules 
of Practice. Former Rule 8(d) authorized the conduct of prehearing 
conferences and briefings. When the Commission comprehensively revised 
and renumbered its Rules of Practice in 1995, former Rule 8(d) was 
incorporated into Rules 221 and 222(a).\6\ However, the reference to 
Rule 8(d) contained in EAJA Rule 55 was not changed at that time. The 
amendment replaces the reference to Rule 8(d) with a reference to Rules 
221 and 222(a).
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    \6\ See Exchange Act Rel. No. 35833 (June 23, 1995), 59 SEC 
Docket 1546, 1631 tbl. III.
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    D. Current Rule 102(e)(3)(iii) provides that Commission review of a 
hearing officer's initial decision on a petition to lift a temporary 
suspension of a person from appearing and practicing before the 
Commission will be governed by the time limits set forth in Sec.  
201.531. The amendment corrects the reference to Sec.  201.540, which 
governs the appeal and Commission review of certain initial decisions.
    E. Currently, Rule 111(h) provides no time limit within which a law 
judge is required to rule upon a motion to correct a manifest error of 
fact in an initial decision. The amendment provides that such a ruling 
must be made within 20 days of the filing of any brief in opposition. 
The amendment further states that any brief in opposition must be filed 
within five days after service of the motion.
    The Commission has received motions purportedly filed pursuant to 
Rule 111(h) that challenge the merits of an initial decision. However, 
Rule 111(h) has a much more limited purpose. Rule 111(h) is therefore 
amended to make clear that motions to correct manifest error are 
properly filed under this Rule only if they contest a patent 
misstatement of fact in the initial decision. Motions purporting to 
contest the substantive merits of the initial decision will be treated 
as a petition for review under Rule 410.
    F. Current Rule 152(d) provides that an original and three copies 
of all papers shall be filed. The Commission is adopting the rule 
substantially as proposed. The amendment makes clear that if filing is 
made by facsimile pursuant to Rule 151, the filer must transmit only 
one non-facsimile original with a manual signature and does not need to 
transmit additional non-facsimile copies. The rule as adopted provides 
that the non-facsimile original must be accompanied by a statement of 
the date on which, and the facsimile number to which, the party made 
transmission of the facsimile filing.
    G. Currently, Rule 154(c) and Rule 250(c) provide page limitations 
for, respectively, motions in general and motions for summary 
disposition. Rule 450(c), however, now sets word-count limitations, 
instead of page limitations, for briefs filed with the Commission. The 
amendment to Rule 154(c) substitutes a limitation for motions of 7,000 
words, exclusive of any table of contents, table of authority, or 
addendum of applicable cases, legislative provisions, or exhibits. Rule 
470(b), which currently requires motions for reconsideration to comply 
with the page length limitation in Rule 154(c), is amended to refer to 
the word limitation in amended Rule 154(c).
    The amendment to Rule 250(c) sets a limitation of 9,800 words for a 
motion for summary disposition and any supporting memorandum of points 
and authorities. The limitation excludes declarations, affidavits, or 
attachments. Motions for summary dispositions are often made in cases 
where a respondent has been criminally convicted or an injunction has 
been entered and the conviction or injunction provides the basis for an 
administrative order against the respondent. In such cases, documents 
establishing the conviction or injunction must be included as exhibits 
to the motion; these documents alone can total more than the entire 
word limitation allotted to the motion. The amendment excludes such 
attachments from the word-count restriction.
    H. Current Rule 201(b) provides that, by order of the Commission, 
any proceeding may be severed with respect to some or all parties. The 
amendment allows severance with respect to ``one or more'' parties, 
making clear that severance is available as to a single party, under 
appropriate circumstances.
    I. Current Rule 210(a)(2) contains a reference to Sec.  201.612. 
Section 612 was renumbered as Sec.  201.1103, effective April 19, 2004. 
The amendment changes the reference accordingly.\7\
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    \7\ Language was inadvertently deleted from Rule 210(b) in an 
earlier revision of the Rules of Practice. This language is now 
being reinstated.
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    J. Current Rule 411(c) refers to ``any brief in opposition to a 
petition for review permitted pursuant to Sec.  201.410(d).'' The Rules 
of Practice no longer provide for briefs in opposition to a petition 
for review, and Section 410(d) was removed and reserved effective April 
19, 2004. The amendment deletes the reference.
    K. Currently, Rule 601(a) provides that funds due pursuant to an 
order by a hearing officer shall be paid on the first day after the 
order becomes final pursuant to Rule 360. Under Rule 360(d)(2) as 
revised, effective April 19, 2004, an initial decision no longer 
becomes final automatically. That rule now provides that the Commission 
will issue an order stating that a decision has become final. Rule 
360(d)(2) further provides for the order of finality to state the date 
on which sanctions, if any, take effect. Amended Rule 601(a) clarifies 
that funds due pursuant to an order by a hearing officer are to be paid 
in accordance with the order of finality.
    L. Current Rule 900(b) requires the Chief Administrative Law Judge 
to apprise the Commission specifically if a proceeding assigned to an 
administrative law judge has not been concluded ``within 30 days of the 
guidelines established in paragraph (a) of this section.'' Paragraph 
(a) no longer contains guidelines relevant to the timely conclusion of 
proceedings before law judges; these guidelines are now found in Sec.  
201.360(a)(2). Rule 360(a)(3) requires the Chief Administrative Law 
Judge to submit a motion for an extension to the Commission if it is 
determined that an initial decision cannot be issued within the period 
specified in the guidelines. The submission of such motions renders the 
specific apprisal by the Chief Administrative Law Judge under Rule 
900(b) unnecessary. The amendment eliminates that requirement.
    M. In proceedings where an order issued by the Commission requires 
a respondent to pay disgorgement and assesses a civil penalty against 
that respondent, current Rule 1100 allows the Commission to create a 
Fair Fund for the benefit of investors who were harmed by the violation 
found. The amendment makes clear that in such cases, hearing officers 
also have the authority to create Fair Funds.
    N. Tables I, II, and III of Subpart D of the Commission Rules of 
Practice have been superseded by subsequent amendments to the federal 
securities laws and these rules, and are of little utility to the 
public. The amendment deletes these tables.
    O. Although not previously proposed for comment, Rule 104, which 
sets the business hours of the Commission, is amended to reflect the 
new address of the Commission Headquarters office, which relocated to 
100 F Street, NE., Washington, DC 20549 after the above amendments were 
proposed.

[[Page 72568]]

    P. The Commission is also correcting existing delegations and 
making new delegations of authority to the staff. Title 17 CFR 200.30-7 
(Delegation of authority to the Secretary of the Commission) currently 
delegates to the Commission's Secretary the authority, among other 
things, to extend the time within which to make filings and to enlarge 
the length limitation on those filings. The Commission is amending 
Sec.  200.30-7(a)(4), which currently authorizes the Secretary to grant 
or deny extensions of time to make filings in administrative 
proceedings, to clarify that the Secretary is authorized to grant 
extensions to parties making filings related to the establishment and 
administration of Fair Funds and disgorgement plans under part 201, 
subpart F of the Commission's Rules of Practice, Sec.  201.1100 et seq.
    The Commission also is amending Sec.  200.30-7(a)(5) and Sec.  
200.30-10(a)(5), which currently permit the Secretary or the Chief 
Administrative Law Judge, respectively, to authorize the filing of 
briefs exceeding 50 pages ``in accordance with Rule 450(c).'' Because 
Rule 450(c) now sets word-count limitations, instead of page 
limitations, for briefs filed with the Commission, the delegations are 
corrected to provide that the Secretary or the Chief Administrative Law 
Judge may authorize a party to file briefs exceeding 14,000 words. The 
Commission also amends Sec.  200.30-7(a)(5) to delegate to the 
Secretary the authority to permit the filing of motions exceeding 7,000 
words in length, pursuant to amended Rule 154(c) of the Commission's 
Rules of Practice.
    The Commission amends Sec.  200.30-14(g)(1)(xii), which delegates 
to the General Counsel the authority to determine requests for leave to 
file an opposition to a petition for review. This delegation is no 
longer necessary, as the Rules of Practice no longer provide for briefs 
in opposition to a petition for review. The Commission has enacted a 
new delegation to permit the General Counsel to set the effective date 
of sanctions imposed on a party that previously were stayed pending 
appeal to the federal courts, once the mandate affirming the imposition 
of sanctions has been issued by the court.

II. Administrative Procedure Act, Regulatory Flexibility Act, and 
Paperwork Reduction Act

    The Commission finds, in accordance with Section 533(b)(3)(A) of 
the Administrative Procedure Act,\8\ that this revision relates solely 
to agency organization, procedure, or practice. It is therefore not 
subject to the provisions of the Administrative Procedure Act requiring 
notice, opportunity for public comment, and publication.\9\ The 
Regulatory Flexibility Act\10\ therefore does not apply. Because these 
rules relate to ``agency organization, procedure or practice that does 
not substantially affect the rights or obligations of non-agency 
parties,'' they are not subject to the Small Business Regulatory 
Enforcement Fairness Act.\11\
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    \8\ 5 U.S.C. 553(b)(3)(A).
    \9\ Nonetheless, the Commission had previously determined that 
it would be useful to publish most of these proposed rules for 
notice and comment before adoption. See 5 U.S.C. 603. The Commission 
received no comments in response to its request.
    \10\ 5 U.S.C. 601 et seq.
    \11\ 5 U.S.C. 804(3)(C).
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    These rules do not contain any collection of information 
requirements as defined by the Paperwork Reduction Act of 1995, as 
amended.\12\
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    \12\ 44 U.S.C. 3501 et seq.
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III. Costs and Benefits of the Proposed Amendments

    Taken as a whole, the Commission's Rules of Practice create 
governmental review and remedial processes. That is, they are 
procedural and administrative in nature. The benefits to the parties 
are the familiar benefits of due process: Notice, opportunity to be 
heard, efficiency, and fairness. The costs of these processes fall 
largely on the Commission.
    The amendments set forth in this release variously clarify existing 
practice, relate to internal agency management, increase the efficiency 
of proceedings, or promote due process. The Commission requested data 
to quantify the costs and the value of the benefits identified. We 
received no comments in response to this request.

IV. Effect on Efficiency, Competition, and Capital Formation

    Section 2(b) of the Securities Act of 1933,\13\ Section 3(f) of the 
Exchange Act,\14\ Section 2(c) of the Investment Company Act of 
1940,\15\ and Section 202(c) of the Investment Advisers Act of 1940 
\16\ require us, when engaging in rulemaking that requires us to 
consider or determine whether an act is necessary or appropriate in the 
public interest, to consider whether the action will promote 
efficiency, competition, and capital formation. Section 23(a)(2) of the 
Exchange Act \17\ prohibits us from adopting any rule that would impose 
a burden on competition not necessary or appropriate in furtherance of 
the purposes of the Exchange Act. These rules and amendments are 
intended to enhance the transparency and facilitate parties' 
understanding of the Rules. The amendments are also intended to clarify 
existing practice and increase the efficiency of Commission enforcement 
and self-regulatory organization disciplinary review proceedings. The 
rules and amendments apply to all persons involved in administrative 
proceedings before the Commission, and therefore the Commission does 
not expect the rules and amendments to have an anti-competitive effect. 
To the extent the rules and amendments would foster making whole 
victims of securities laws violations and would increase the 
transparency and efficiency of the Commission's administrative 
proceedings, there might be an increase in investor confidence in 
market fairness and efficiency. However, the magnitude of the effect of 
the amendments in this regard is difficult to quantify. We requested 
comment on the possible effects of our rule proposals on efficiency, 
competition, and capital formation. We received no comments in response 
to this request.
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    \13\ 15 U.S.C. 77b(b).
    \14\ 15 U.S.C. 78c(f).
    \15\ 15 U.S.C. 80a-2(c).
    \16\ 15 U.S.C. 80b-2(c).
    \17\ 15 U.S.C. 78w(a)(2).
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V. Statutory Basis and Text of Proposed Amendments

    These amendments to the Rules of Practice and related provisions 
are being adopted pursuant to statutory authority granted to the 
Commission, including section 3 of the Sarbanes-Oxley Act of 2002, 15 
U.S.C. 7202; section 19 of the Securities Act, 15 U.S.C. 77s; sections 
4A, 19, and 23 of the Exchange Act, 15 U.S.C. 78d-1, 78s, and 78w; 
section 20 of the Public Utility Holding Company Act of 1935, 15 U.S.C. 
79t; section 319 of the Trust Indenture Act of 1939, 15 U.S.C. 77sss; 
sections 38 and 40 of the Investment Company Act, 15 U.S.C. 80a-37 and 
80a-39; and section 211 of the Investment Advisers Act, 15 U.S.C. 80b-
11.

List of Subjects

17 CFR Part 200

    Administrative practice and procedure, Authority delegations 
(Government Agencies).

17 CFR Part 201

    Administrative practice and procedure.

Text of the Adopted Rules

0
For the reasons set out in the preamble, Title 17, Chapter II of the 
Code of Federal Regulations is amended as follows:

[[Page 72569]]

PART 200--ORGANIZATION; CONDUCT AND ETHICS; AND INFORMATION AND 
REQUESTS

0
1. The authority citation for part 200, subpart A continues to read in 
part as follows:

    Authority: 15 U.S.C. 77s, 77o, 77sss, 78d, 78d-1, 78d-2, 78w, 
78ll(d), 78mm, 79t, 80a-37, 80b-11, and 7202, unless otherwise 
noted.
* * * * *

0
2. Section 200.30-7 is amended by revising paragraphs (a)(4) and (a)(5) 
to read as follows:


Sec.  200.30-7  Delegation of authority to Secretary of the Commission.

* * * * *
    (a) * * *
    (4) To grant or deny extensions of time within which to file papers 
with the Commission under Rule 161 of the Commission's Rules of 
Practice, Sec.  201.161 of this chapter, or under part 201, subpart F 
of the Commission's Rules pertaining to Fair Fund and Disgorgement 
Plans, Sec. Sec.  201.1100-201.1106;
    (5) To permit the filing of briefs with the Commission exceeding 
14,000 words in length, pursuant to Rule 450(c) of the Commission's 
Rule of Practice, Sec.  201.450(c) of this chapter, and to permit the 
filing of motions with the Commission in excess of 7,000 words pursuant 
to Rule 154(c) of the Commission's Rules of Practice, Sec.  201.154(c) 
of this chapter;
* * * * *


Sec.  200.30-10  [Amended]

0
3. In Sec.  200.30-10, paragraph (a)(5), remove the words ``50 pages'' 
and, in their place, add the words ``14,000 words''.

0
4. Section 200.30-14 is amended by revising paragraph (g)(1)(xii) to 
read as follows:


Sec.  200.30-14  Delegation of authority to the General Counsel.

* * * * *
    (g)(1) * * *
    (xii) To issue an order setting the effective date of sanctions 
that were stayed pending appeal to the federal courts, upon issuance of 
the mandate affirming the Commission's order imposing those sanctions.
* * * * *

PART 201--RULES OF PRACTICE

0
5. The authority citation for part 201 continues to read as follows:

    Authority: 15 U.S.C. 77s, 78w, 78x, 79t, 77sss, 80a-37 and 80b-
11; 5 U.S.C. 504(c)(1).

Subpart B--Regulations Pertaining to the Equal Access to Justice 
Act


Sec.  201.55  [Amended]

0
6. In Sec.  201.55(a), in the third sentence, remove the words ``Rule 
8(d) of the Commission's Rules of Practice'' and, in their place, add 
the words ``Sec.  201.221 and Sec.  201.222(a)''.

0
7. The authority citation for Part 201, subpart D, continues to read as 
follows:

    Authority: 15 U.S.C. 77f, 77g, 77h, 77h-1, 77j, 77s, 77u, 
78c(b), 78d-1, 78d-2, 78l, 78m, 78n, 78o(d), 78o-3, 78s, 78u-2, 78u-
3, 78v, 78w, 79c, 79s, 79t, 79z-5a, 77sss, 77ttt, 80a-8, 80a-9, 80a-
37, 80a-38, 80a-39, 80a-40, 80a-41, 80a-44, 80b-3, 80b-9, 80b-11, 
80b-12, 7202, 7215, and 7217.


Sec.  201.102  [Amended]

0
8. In Sec.  201.102(e)(3)(iii), in the last sentence, remove the cite 
``Sec.  201.531'' and, in its place, add the cite ``Sec.  201.540''.


Sec.  201.104  [Amended]

0
9. In Sec.  201.104, remove the words ``450 Fifth Street, NW., 
Washington, DC 20549'' and, in their place, add the words ``100 F 
Street, NE., Washington, DC 20549''.

0
10. Section 201.111 is amended by revising paragraph (h) to read as 
follows:


Sec.  201.111  Hearing officer: Authority.

* * * * *
    (h) Subject to any limitations set forth elsewhere in these Rules 
of Practice, considering and ruling upon all procedural and other 
motions, including a motion to correct a manifest error of fact in the 
initial decision. A motion to correct is properly filed under this Rule 
only if the basis for the motion is a patent misstatement of fact in 
the initial decision. Any motion to correct must be filed within ten 
days of the initial decision. A brief in opposition may be filed within 
five days of a motion to correct. The hearing officer shall have 20 
days from the date of filing of any brief in opposition filed to rule 
on a motion to correct;
* * * * *

0
11. Section 201.141 is amended by:
0
a. Revising paragraph (a)(2)(ii); and
0
b. Adding paragraph (a)(2)(vi).
    The revision and addition read as follows.


Sec.  201.141  Orders and decisions: Service of orders instituting 
proceedings and other orders and decisions.

    (a) * * *
    (2) * * *
    (ii) To corporations or entities. Notice of a proceeding shall be 
made to a person other than a natural person by delivering a copy of 
the order instituting proceedings to an officer, managing or general 
agent, or any other agent authorized by appointment or law to receive 
such notice, by any method specified in paragraph (a)(2)(i) of this 
section, or, in the case of an issuer of a class of securities 
registered with the Commission, by sending a copy of the order 
addressed to the most recent address shown on the entity's most recent 
filing with the Commission by U.S. Postal Service certified, 
registered, or Express Mail and obtaining a confirmation of attempted 
delivery.
* * * * *
    (vi) To persons registered with self-regulatory organizations. 
Notice of a proceeding shall be made to a person registered with a 
self-regulatory organization by any method specified in paragraph 
(a)(2)(i) of this section, or by sending a copy of the order addressed 
to the most recent address for the person shown in the Central 
Registration Depository by U.S. Postal Service certified, registered, 
or Express Mail and obtaining a confirmation of attempted delivery.
* * * * *

0
12. Section 201.152 is amended by revising paragraph (d) to read as 
follows:


Sec.  201.152  Filing of papers: Form.

* * * * *
    (d) Number of copies. An original and three copies of all papers 
shall be filed, unless filing is made by facsimile in accordance with 
Sec.  201.151. If filing is made by facsimile, the filer shall also 
transmit to the Office of the Secretary one non-facsimile original with 
a manual signature, contemporaneously with the facsimile transmission. 
The non-facsimile original must be accompanied by a statement of the 
date on which, and the facsimile number to which, the party made 
transmission of the facsimile filing.
* * * * *

0
13. Section 201.154 is amended by revising paragraph (c) to read as 
follows:


Sec.  201.154  Motions.

* * * * *
    (c) Length limitation. No motion (together with the brief in 
support of the motion), brief in opposition to the motion, or reply 
brief shall exceed 7,000 words, exclusive of any table of contents or 
table of authorities. The word limit shall not apply to any addendum 
that consists solely of copies of applicable cases, pertinent 
legislative provisions or rules, or relevant exhibits. Requests for 
leave to file motions and briefs in excess of 7,000 words are 
disfavored. A motion

[[Page 72570]]

or brief, together with any accompanying brief, that does not exceed 15 
pages in length, exclusive of pages containing the table of contents, 
table of authorities, and any addendum that consists solely of copies 
of applicable cases, pertinent legislative provisions, or rules and 
exhibits, but inclusive of pleadings incorporated by reference, is 
presumptively considered to contain no more than 7,000 words. Any 
motion or brief that exceeds these page limits must include a 
certificate by the attorney, or an unrepresented party, stating that 
the document complies with the length limitation set forth in this 
paragraph and stating the number of words in the document. The person 
preparing the certificate may rely on the word count of a word-
processing program to prepare the document.

0
14. Section 201.201 is amended by revising the first sentence of 
paragraph (b) to read as follows:


Sec.  201.201  Consolidation and severance of proceedings.

* * * * *
    (b) * * * By order of the Commission, any proceeding may be severed 
with respect to one or more parties. * * *

0
15. Section 201.210 is amended by:
0
a. In paragraph (a)(2), removing the cite ``Sec.  201.612'' and, in its 
place, adding the cite ``Sec.  201.1103'';
0
b. At the end of the introductory text of paragraph (b)(1), removing 
the colon and in its place adding a period; and
0
c. Adding a sentence at the end of the introductory text of paragraph 
(b)(1).
    The addition reads as follows:


Sec.  201.210  Parties, limited participants and amici curiae.

* * * * *
    (b) * * * (1) * * * No person, however, shall be admitted as a 
party to a proceeding by intervention unless it is determined that 
leave to participate pursuant to paragraph (c) of this section would be 
inadequate for the protection of the person's interests.
* * * * *

0
16. Section 201.250 is amended by revising paragraph (c) to read as 
follows:


Sec.  201.250  Motion for summary disposition.

* * * * *
    (c) The motion for summary disposition, together with any 
supporting memorandum of points and authorities (exclusive of any 
declarations, affidavits, or attachments), shall not exceed 9,800 
words. Requests for leave to file motions and accompanying documents in 
excess of 9,800 words are disfavored. A motion that does not, together 
with any accompanying memorandum of points and authorities, exceed 35 
pages in length, inclusive of pleadings incorporated by reference (but 
excluding any declarations, affidavits, or attachments) is 
presumptively considered to contain no more than 9,800 words. Any 
motion that exceeds these page limits must include a certificate by the 
attorney, or an unrepresented party, stating that the brief complies 
with the length limitation set forth in this paragraph and stating the 
number of words in the motion. The person preparing the certificate may 
rely on the word count of a word-processing program to prepare the 
document.

0
17. Section 201.411 is amended by revising the first sentence in 
paragraph (c) to read as follows:


Sec.  201.411  Commission consideration of initial decisions by hearing 
officers.

* * * * *
    (c) * * * The Commission may, on its own initiative, order review 
of any initial decision, or any portion of any initial decision, within 
21 days after the end of the period established for filing a petition 
for review pursuant to Sec.  210.410(b). * * *
* * * * *

0
18. Section 201.430 is amended by revising paragraph (b)(1) to read as 
follows:


Sec.  201.430  Appeal of actions made pursuant to delegated authority.

* * * * *
    (b) * * * (1) Notice of intention to petition for review. A party 
to an action made pursuant to delegated authority, or a person 
aggrieved by such action, may seek Commission review of the action by 
filing a written notice of intention to petition for review within five 
days after actual notice of the action to that party or aggrieved 
person, or 15 days after publication of the notice of action in the 
Federal Register, or five days after service of notice of the action on 
that party or aggrieved person pursuant to Sec.  201.141(b), whichever 
is the earliest.
* * * * *

0
19. Section 201.470 is amended by revising the third sentence of 
paragraph (b) to read as follows:


Sec.  201.470  Reconsideration.

* * * * *
    (b) * * * A motion for reconsideration shall conform to the 
requirements, including the limitation on the numbers of words, 
provided in Sec.  201.154. * * *

0
20. Section 201.601 is amended by revising paragraph (a) to read as 
follows:


Sec.  201.601  Prompt payment of disgorgement, interest and penalties.

    (a) Timing of payments. Unless otherwise provided, funds due 
pursuant to an order by the Commission requiring the payment of 
disgorgement, interest, or penalties shall be paid no later than 21 
days after service of the order, and funds due pursuant to an order by 
a hearing officer shall be paid in accordance with the order of 
finality issued pursuant to Sec.  201.360(d)(2).
* * * * *

0
21. Section 201.900 is amended by revising the last sentence in 
paragraph (b) to read as follows:


Sec.  201.900  Informal Procedures and Supplementary Information 
Concerning Adjudicatory Proceedings.

* * * * *
    (b) * * * In connection with these periodic reports, if a 
proceeding pending before the Commission has not been concluded within 
30 days of the guidelines established in paragraph (a) of this section, 
the General Counsel shall specifically apprise the Commission of that 
fact, and shall describe the procedural posture of the case, project an 
estimated date for conclusion of the proceeding, and provide such other 
information as is necessary to enable the Commission to determine 
whether additional steps are necessary to reach a fair and timely 
resolution of the matter.
* * * * *

Subpart D [Amended]

0
22. Part 201, subpart D, is amended by removing Tables I, II, and III 
at the end of the subpart.

Subpart F--Fair Fund and Disgorgement Plans

0
23. The authority citation for subpart F continues to read as follows.

    Authority: 15 U.S.C. 77h-1, 77s, 77u, 78c(b), 78d-1, 78d-2, 78u-
2, 78u-3, 78v, 78w, 80a-9, 80a-37, 80a-39, 80a-40, 80b-3, 80b-11, 
80b-12, and 7246.


0
24. Section 201.1100 is revised to read as follows:


Sec.  201.1100  Creation of Fair Fund.

    In any agency process initiated by an order instituting proceedings 
in which the Commission or the hearing officer issues an order 
requiring the payment of disgorgement by a respondent and also 
assessing a civil money penalty against that respondent, the Commission 
or the hearing officer may order that the amount of disgorgement and of 
the civil penalty, together with any funds received pursuant to 15 
U.S.C. 7246(b),

[[Page 72571]]

be used to create a fund for the benefit of investors who were harmed 
by the violation.

    Dated: November 29, 2005.

    By the Commission.
Jonathan G. Katz,
Secretary.
[FR Doc. 05-23613 Filed 12-2-05; 8:45 am]

BILLING CODE 8010-01-P
