shall be the policy of the Commission to fully guard against any infringement of require that employees bear in mind the the constitutional rights, privileges, or principles specified in the Canons. immunities of those who are subject to & 200.52 Copies of the Canons. regulation by this Commission. The Canons have been distributed to $ 200.55 Statutory obligations. employees of the Commission. In addi- In administering the law, members of tion, executive and professional em- this Commission should vigorously enployees are issued copies of the Canons force compliance with the law by all upon entrance on duty. persons affected thereby. In the exercise $ 200.53 Preamble. of the rule-making powers delegated this Commission by the Congress, members (a) Members of the Securities and should always be concerned that the ruleExchange Commission are entrusted by making power be confined to the proper various enactments of the Congress with limits of the law and be consistent with powers and duties of great social and the statutory purposes expressed by the economic significance to the American Congress. In the exercise of their people. It is their task to regulate varied judicial functions, members shall honaspects of the American economy, within estly, fairly and impartially determine the limits prescribed by Congress, to in the rights of all persons under the law. sure that our private enterprise system serves the welfare of all citizens. Their § 200.56 Personal conduct. success in this endeavor is a bulwark Appointment to the office of member against possible abuses and injustice of this Commission is a high honor and which, if left unchecked, might jeopard requires that the conduct of a member, ize the strength of our economic institu not only in the performance of the duties tions. of his office but also in his everyday life, (b) It is imperative that the members should be beyond reproach. of this Commission continue to conduct $ 200.57 Relationships with other memthemselves in their official and personal bers. relationships in a manner which commands the respect and confidence of Each member should recognize that his their fellow citizens. Members of this conscience and those of other members Commission shall continue to be mind- are distinct entities and that differing ful of, and strictly abide by, the stand shades of opinion should be anticipated. ards of personal conduct set forth in its The free expression of opinion is a safeRegulation regarding Conduct of Mem guard against the domination of this bers and Employees and Former Mem. Commission by less than a majority, and bers and Employees of the Commission, is a keystone of the commission type of which is set forth in Subpart M of this administration. However, a member Part 200, most of which has been in effect should never permit his personal opinion for many years, and which was originally so to conflict with the opinion of another codified in 1953. member as to develop animosity or un(c) However, in addition to the con friendliness in the Commission, and tinued observance of those principles of every effort should be made to promote personal conduct, it is fitting and proper solidarity of conclusion. for the members of the Commission to $ 200.58 Maintenance of independence. restate and resubscribe to the standards This Commission has been established of conduct applicable to its executive, to administer laws enacted by the Conlegislative and judicial responsibilities. gress. Its members are appointed by the 125 F.R. 6725, July 15, 1960, as amended at 31 F.R. 13533, Oct. 20, 1966) Preisdent by and with the advice and consent of the Senate to serve terms as & 200.54 Constitutional obligations. provided by law. However, under the The members of this Commission have law, this is an independent Agency, and undertaken in their oaths of office to in performing their duties, members support the Federal Constitution. Inso should exhibit a spirit of firm independfar as the enactments of the Congress ence and reject any effort by representimpose executive duties upon the mem- atives of the executive or legislative bers, they must faithfully execute the branches of the government to affect laws which they are charged with ad- their independent determination of any ministering. Members shall also care- matter being considered by this Com aission. A member should not be wayed by partisan demands, public lamor or considerations of personal opularity or notoriety; so also he should e above fear of unjust criticism by nyone. 200.59 Relationship with persons sub ject to regulation. In all matters before him, a member hould administer the law without regard o any personality involved, and with regard only to the issues. Members should not become indebted in any way to persons who are or may become subject to their jurisdiction. No member should accept loans, presents or favors of undue value from persons who are regulated or who represent those who are regulated. In performing their judicial functions, members should avoid discussion of a matter with any person outside this Commission and its staff while that matter is pending. In the performance of his rule-making and administrative functions, a member has a duty to solicit the views of interested persons. Care must be taken by a member in his relationship with persons within or outside of the Commission to separate the judicial and the rule-making functions and to observe the liberties of discussion respectively appropriate. Insofar as it is consistent with the dignity of his oficial position, he should maintain contact with the persons outside the agency who may be affected by his rulemaking functions, but he should not accept unreasonable or lavish hospitality in so doing. 8 200.60 Qualification to participate in particular matters. The question in a particular matter rests with that individual member. Each member should weigh carefully the question of his qualification with respect to any matter wherein he or any relatives or former business associates or clients are involved. He should disqualify himself in the event he obtained knowledge prior to becoming a member of the facts at issue before him in a quasi-judicial proceeding, or in other types of proceeding in any matter involving parties in whom he has any interest or relationship directly or indirectly. If an interested person suggests that a member should disqualify himself in a particular matter because of bias or prejudice, the member shall be the judge of his own qualifica tion. $200.61 Impressions of influence. A member should not, by his conduct, permit the impression to prevail that any person can improperly influence him, that any person unduly enjoys his favor or that he is affected in any way by the rank, position, prestige, or affluence of any person. $ 200.62 Ex parte communications. All proceedings required to be determined by the Commission on the record shall be determined by the members solely upon the record and the arguments of the parties or their counsel properly made in the regular course of such proceeding. A member shall at all times comply with the Commission's Code of Behavior governing ex parte communications between persons outside the Commission and decisional employees, $ 200.110 et seq. [28 F.R. 4446, May 3, 1963] $ 200.63 Commission opinions. The opinions of the Commission should state the reasons for the action taken and contain a clear showing that no serious argument of counsel has been disregarded or overlooked. In such manner, a member shows a full understanding of the matter before him, avoids the suspicion of arbitrary conclusion, promotes confidence in his intellectual integrity and may contribute some useful precedent to the growth of the law. A member should be guided in his decisions by a deep regard for the integrity of the system of law which he administers. He should recall that he is not a repository of arbitrary power, but is acting on behalf of the public under the sanction of the law. $ 200.64 Judicial review. The Congress has provided for review by the courts of the decisions and orders by this Commission. Members should recognize that their obligation to preserve the sanctity of the laws administered by them requires that they pursue and prosecute, vigorously and diligently but at the same time fairly and impartially and with dignity, all matters which they or others take to the courts for judicial review. $ 200.65 Legislative proposals. Members must recognize that the changing conditions in a volatile economy may require that they bring to the attention of the Congress proposals to amend, modify or repeal the laws admin- ceedings. While avoiding arbitrary istered by them. They should urge the action in unreasonably or unjustly forcCongress, whenever necessary, to effect ing matters to trial, members should ensuch amendment, modification or repeal deavor to hold counsel to a proper appreof particular parts of the statutes which ciation of their duties to the public, their they administer. In any action a mem clients and others who are interested. ber's motivation should be the common Requests for continuances of matters weal and not the particular interests of should be determined in a manner conany particular group. sistent with this policy. $ 200.66 Investigations. $ 200.69 Conduct toward parties and their counsel. The power to investigate carries with 1t the power to defame and destroy. In Members should be temperate, attendetermining to exercise their investiga- tive, patient and impartial when hearing tory power, members should concern the arguments of parties or their counsel. themselves only with the facts known to Members should not condone unprofesthem and the reasonable inferences from sional conduct by attorneys in their repthose facts. A member should never resentation of parties. The Commission suggest, vote for, or participate in an in should continuously assure that its staff vestigation aimed at a particular individ follows the same principles in their relaual for reasons of animus, prejudice or tionships with parties and counsel. vindictiveness. The requirements of $ 200.70 Business promotions. the particular case alone should induce the exercise of the investigatory power, A member must not engage in any and no public pronouncement of the other business, employment or vocation pendency of such an investigation should while in office, nor may he ever use the be made in the absence of reasonable power of his office or the influence of his evidence that the law has been violated name to promote the business interests and that the public welfare demands it. of others. 8 200.67 Power to adopt rules. $ 200.71 Fiduciary relationships. In exercising its rule-making power, A member should avoid service as a this Commission performs a legislative nission performs a legislative fiduciary if it would interfere or seem function. The delegation of this power to interfere with the proper perform mance by the Congress imposes the obligation of his duties, cr if the interests of those upon the members to adopt rules neces represented require investments in entersary to effectuate the stated policies of stated policies of prises which are involved in questions to the statute in the interest of all of the be determined by him. Such relationpeople. Care should be taken to avoid ships would include trustees, executors, the adoption of rules which seek to ex corporate directors, and the like. tend the power of the Commission be 8 200.72 Supervision of internal organiyond proper statutory limits. Its rules zation. should never tend to stifle or discourage Members and particularly the Chair. legitimate business enterprises or activi man of the Commission should scrutinize ties, nor should they be interpreted so as continuously its internal organization in unduly and unnecessarily to burden those regulated with onerous obligations. On order to assure that such organization the other hand, the very statutory en handles all matters before it efficienti actments evidence the need for regula- and expeditiously, while recognizing that tion, and the necessary rules should be changing times bring changing emphasis adopted or modifications made or rules in the administration of the laws. should be repealed as changing require Subpart D---Information and Requests ments demand without fear or favor. AUTHORITY: The provisions of this Subpart 8 200.68 Promptness. D issued under 80 Stat. 383, as amended Each member should promptly per- sec. 3, 60 Stat. 238, as amended, 81 Stat. 54 form the duties with which he is charged secs. 19, 23, 48 Stat. 85, 901, as amended, sec by the statutes. The Commission should 20, 49 Stat. 833, sec. 319, 53 Stat. 1173, secs evaluate continuously its practices and 38, 211, 54 Stat. 841, 855; 5 U.S.C. 552, 18 procedures to assure that it promptly U.S.C. 778, 78, 790, 77885, 80a-37, 80b-11. disposes of all matters affecting the SOURCE: The provisions of this Subpart I rights of those regulated. This is par- appear at 32 F.R. 9828, July 6, 1967, unlesi ticularly desirable in quasi-judicial pro- otherwise noted. 3 200.80 Commission records and infor. mation. (a) Information published in the Fedpral Register. Except as provided in paragraph (c) of this section the following materials are published in the FEDERAL REGISTER for the guidance of the public: (1) Description of the Commission's central and field organization and the established places at which, the employees from whom, and the methods whereby the public may obtain information, make submittals or requests, or obtain decisions; (2) Statements of the general course and method by which the Commission's functions are channeled and determined, including the nature and requirements of all formal and informal procedures available; (3) Rules of procedure, descriptions of forms available or the places at which forms may be obtained, and instructions as to the scope and contents of all papers, reports, or examinations; (4) Substantive rules of general applicability adopted as authorized by law, and statements of general policy or interpretations of general applicability formulated and adopted by the Commission; and (5) Each amendment, revision, or repeal of the foregoing. (b) Public reference facilities; materials and records available. (1) The Commission has a specially staffed and equipped public reference room in its principal office at Washington, D.C., and public reference facilities in the New York and Chicago Regional Offices. Some facilities for public use are also provided in other regional and branch offices. In addition to materials otherwise set forth in this paragraph, certain of the materials described in paragraph (a) of this section will be available at the public reference room at the principal office of the Commission and may be available at the Regional Offices. (2) Except as provided in paragraph (c) of this section the materials hereinafter set forth in this subparagraph (2) are available for public Inspection and copying during normal business hours at the public reference room at the principal ofice of the Commission and at the Regional Offices of the Commission. To the extent required to prevent a clearly unwarranted invasion of personal privacy, identifying details may be deleted, e.g., apparently defamatory statements made about any person, information received by or given to the Commission in confidence, or any contents of personnel and medical and similar files. In addition, certain materials which are considered to be nonpublic, as described in paragraph (c) of this section may, as authorized by the Commission from time to time, be made available for public inspection and copying in an abridged or summary form or with identifying details deleted. (i) Final opinions of the Commission, including concurring and dissenting opinions, as well as orders made by the Commission in the adjudication of cases; (ii) A record of the final votes of each member of the Commission in every Commission proceeding concluded after July 1, 1967. (iii) Statements of policy and interpretations which have been adopted by the Commission and are not published in the FEDERAL REGISTER; (iv) Administrative staff manuals and instructions to staff that affect a member of the public; and (v) Current indices to the materials made available pursuant to subparagraphs (1), (iil), and (iv) of this subparagraph (2) which have been issued, adopted or promulgated after July 1, 1967, and such other indices as the Commission may determine. (3) Subject to the provisions of paragraphs (c), (e) and (g) of this section, all other records and documents retained by the Commission in the performance of its statutory duties will promptly be made available for inspection to any person, and a copy of any record or document will be provided as soon as may be practicable, upon request made pursuant to paragraph (d) of this section. A compilation of documentary materials avail. able at the public reference room at the principal office of the Commission appears below as Appendix A to this section (17 CFR 200.80a). (4) All regional offices have available for public examination copies of prospectuses used in recent offerings of securities registered under the Securities Act; registration statements and recent annual reports filed pursuant to the Securities Exchange Act of companies hav. ing their principal office in their respective regions: active broker-deal and investment adviser applications originating in their respective regions; and Regulation A (17 CFR 200.251 et seq.) letters of notification filed in their respective regions. (5) In the New York offices of the Commission other available materials in clude copies of all recent registration statements and annual reports filed pursuant to the Securities Exchange Act; recent periodic reports made by companies having securities listed on exchanges; and recent periodic reports by many companies which have effective registration statements under the Securities Act of 1933. (6) In the Chicago offices of the Commission other available materials include all recent registration statements and annual reports filed pursuant to the Securities Exchange Act, and other recent periodic reports of many companies which have securities listed on exchanges. the Commission other available materials include all recent registration statements and annual reports filed pursuant to the Securities Exchange Act. (c) Nonpublic matters. Certain materials and records are considered to be nonpublic. Thus the Commission will not generally publish or make available to any person matters that are: (1) Specifically required by Executive order to be kept secret in the interest of the national defense or foreign policy. (2) Related solely to the internal personnel rules and practices of the Commission or any other agency of the Government of the United States, including operation rules, guidelines, and manuals of procedure for investigators, auditors, and other employees. 3) Specifically exempted from disclosure by statute, including: (i) Information contained in any notification, statement, application, declaration, report, or other document or record filed with or received by the ment Company Act of 1940 and Rule 45a-1 (17 CFR 270.45a-1) thereunder, or section 210 of the Investment Advisers Act of 1940; and (ii) Information concerning administrative proceedings which are nonpublic pursuant to the provisions of section 22 of the Securities Exchange Act of 1934. section 19 of the Public Utility Holding Company Act of 1935, section 320 of the Trust Indenture Act of 1939, section 41 of the Investment Company Act of 1940, or section 212 of the Investment Advisers Act of 1940. (4) Trade secrets and commercial and financial information obtained from a person and privileged or confidentiai. including: (i) Information contained in letters of comment in connection with registration statements, applications for registration or other material filed with the Commission, replies thereto, and related material which is deemed to have been submitted to the Commission in confidence or to be confidential at the instance of the registrant or person who has filed such material unless the contrary clearly appears; and (ii) Information contained in any document submitted to or required to be filed with the Commission where the Commission has undertaken formally or informally to receive such submission or filing for its use or the use of specified persons only, such as preliminary proxy material filed pursuant to Rule 14a-6 under the Securities Exchange Act (17 CFR 240.14a-6), reports filed pursuant to Rule 322 (c) and (d) under the Securities Act (17 CFR 230.322 (c) and (d)), agreements filed pursuant to Rule 320 (e) under the Securities Act (17 CFR 230.320 (e)) or Rule 150–3–1(c) (7) (G) under the Securities Exchange Act (17 CFR 240.15c3-1(c) (7) (vii)) and schedules filed pursuant to Part II of Form X17A-5 (17 CFR 249.617) in accordance with Rule 17a-5(b) (3) under the Securities Exchange Act (17 CFR 240.17a5(b) (3)); and (iii) Information contained in reports, summaries, analyses, letters, or memoranda arising out of or in connection with an examination or inspection or other investigation of the books and rec. ords of any person. (5) Interagency or intra-agency memoranda or letters, including records which reflect discussions between or consideration by members of the Commission or members of its staff, or both, of law which is entitled to confidential treatment by operation or application of the provision of Clause 30 of Schedule A of the Securities Act of 1933 and Rule 485 (17 CFR 230.485) thereunder, section 24 of the Securities Exchange Act of 1934 and Rule 24b_2 (17 CFR 240.24b-2) thereunder, section 22 of the Public Utility Holding Company Act of 1935 and Rule 104(b) (17 CFR 250.104(b)) thereunder, section 321(b) of the Trust Indenture Act of 1939, section 33(b) of the Investment Company Act of 1940, section 45(a) of the Invest |