Leaders Ask SEC to Hold Off on SuperMontage

FRAMINGHAM (08/21/2000) - Two lawmakers have asked U.S. Securities and Exchange Commission Chairman Arthur Levitt to wait a little longer before approving the rollout of SuperMontage, the updated electronic-trading system proposed for the Nasdaq Stock Exchange.

In a letter sent to Levitt last Thursday, Sen. Phil Gramm (R-Texas), chairman of the Senate Committee on Banking, Housing and Urban Affairs, and U.S. Rep.Tom Bliley (R-Va.), chairman of the House Commerce Committee, recommended adding another 30 days to the 15-day public comment period before implementing SuperMontage.

Electronic-communications networks, which now facilitate 30% of the buy-and-sell orders for stocks listed with Nasdaq Stock Market Inc., are concerned that the SuperMontage system will make Nasdaq a competitor, said Dana Stiffler, an analyst at Meridien Research Inc. in Boston.

In their letter to Levitt, Gramm and Bliley said, "The . . . SuperMontage proposal raises a number of difficult issues that must be carefully addressed if we are to promote both enhanced competition and increased efficiency in our securities markets. In the name of improving the marketplace, great damage could be done if we are not careful."

Michael Hogan, senior vice president and general counsel at DLJ Direct Inc. in Jersey City, N.J. said, "The main question for most people is whether [(SuperMontage] is a directive or a methodology. Gramm and Bliley are saying let's just slow down and understand it. From DLJ's standpoint, that's the right approach."

Stiffler said changes to the original proposal presented to the SEC last week by Nasdaq officials may soothe some concerns that the electronic-communications networks have.

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