January 15, 1991
TO: BOARD OF GOVERNORS NO. 8-91
RE: ADDITIONAL ICI COMMENT LETTERS ON INDEX PARTICIPATION
PRODUCTS
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The Institute recently has filed two more letters with the
SEC commenting on proposed rules governing index participations.
(Last November, the Institute filed a comment letter on proposed
amendments by the Philadelphia Stock Exchange to its rules
governing its index participation product, known as CIPs. See
Memorandum to Board of Governors No. 81-90, dated December 4,
1990.) Copies of both letters are attached.
The first letter addresses proposed amendments to the rules
governing the index participation products of the American Stock
Exchange (known as EIPs). The amendments, similar to those
proposed by the Philadelphia Stock Exchange, would permit EIPs to
be redeemed daily without payment of any penalty. The second
letter comments on a proposal by the New York Stock Exchange, which
has proposed its own index participation product called "Equity
Receipts" or "ERs".
Both Institute letters state that if the index participations
constitute securities, they are investment company securities
required to be registered and regulated under the 1940 Act.
We will keep you informed of developments.
Craig S. Tyle
Associate General Counsel
Attachments