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RULES OF THE SECURITIES AND EXCHANGE COMMISSION RELATING
(These Rules are published as Part 203 of Title 17 of the Code of Federal Regulations. Thus the Code
citation for Rule 1 would be 17 CFR 203.1.)
These rules apply only to investigations conducted by the Commission. They do not apply to adjudicative or rulemaking proceedings. Rule 2. Information obtained in Investigations
and Examinations. Information or documents obtained by the Commission in the course of any investigation or examination, unless made a matter of public record, shall be deemed nonpublic. Rule 3. Suspension and Disbarment.
The provisions of Rule 2(e) of the Commission's Rules of Practice are hereby made specifically applicable to all investigations.
FORMAL INVESTIGATIVE PROCEEDINGS Rule 4. Applicability of Rules 4 through 8.
(a) Rules 4 through 8 hereof shall be applicable to a witness who is sworn in a proceeding pursuant to a Commission order for investigation or examination, such proceeding being hereinafter referred to as a “formal investigative proceeding.”
(b) Formal investigative proceedings may be held before the Commission, before one or more of its members, or before any officer designated by it for the purpose of taking testimony of witnesses and receiving other evidence. The term "officer conducting the investigation” shall mean any of the foregoing Rule 5. Nonpublic Formal Investigative Pro
ceedings. Unless otherwise ordered by the Commission, all formal investigative proceedings shall be nonpublic. Rule 6. Transcripts.
Transcripts, if any, of formal investigative proceedings, shall be recorded solely by the official
reporter, or by any other person or means designated by the officer conducting the investigation. A person who has submitted documentary evidence or testimony in a formal investigative proceeding shall be entitled to procure a copy of his documentary evidence or a transcript of his testimony on payment of the appropriate fees; provided, however, that in a nonpublic formal investigative proceeding a person seeking a transcript of his testimony shall file a written request stating the reason he desires to procure such transcript, and the Commission may for good cause deny such request. In any event, any witness (or his counsel), upon proper identification, shall have the right to inspect the official transcript of the witness' own testimony. Rule 7. Rights of Witnesses.
(a) Any person who is compelled or requested to furnish documentary evidence or testimony at a formal investigative proceeding shall upon request be shown the Commission's order of investigation. Copies of formal orders of investigation shall not be furnished, for their retention, to such persons requesting the same except with the express approval of a Director of the Division or Divisions conducting or supervising the investigation. Such approval shall not be given unless the Division Director in his discretion is satisfied that there exist reasons consistent both with the protection of privacy of persons involved in the investigation and with the unimpeded conduct of the investigation.
(b) Any person compelled to appear, or who appears by request or permission of the Commission, in person at a formal investigative proceeding may be accompanied, represented and advised by counsel, as defined in Rule 2(b) of the Commission's Rules of Practice; provided, however, that all witnesses shall be sequestered, and unless permitted in the discretion of the officer conducting
the investigation no witness or the counsel accompaning any such witness shall be permitted to be present during the examination of any other witness called in such proceeding.
(c) The right to be accompanied, represented and advised by counsel shall mean the right of a person testifying to have an attorney present with him during any formal investigative proceeding and to have this attorney (i) advise such person before, during and after the conclusion of such examination, (ii) question such person briefly at the conclusion of the examination to clarify any of the answers such person has given, and (iii) make summary notes during such examination solely for the use of such person.
(d) Unless otherwise ordered by the Commission, in any public formal investigative proceeding, if the record shall contain implications of wrongdoing by any person, such person shall have the right to appear on the record; and in addition to the rights afforded other witnesses hereby, he shall have a reasonable opportunity of cross-examination and production of rebuttal testimony or documentary evidence. “Reasonable" shall mean
permitting persons as full an opportunity to assert their position as may be granted consistent with administrative efficiency and with avoidance of undue delay. The determination of reasonableness in each instance shall be made in the discretion of the officer conducting the investigation.
(e) The officer conducting the investigation may report to the Commission any instances where any witness or counsel has been guilty of dilatory, obstructionist or contumacious conduct during the course of an investigation or any other instance of violation of these rules. The Commission will thereupon take such further action as the circumstances may warrant, including suspension or disbarment of counsel from further appearance or practice before it, in accordance with Rule 2(e) of the Commission's Rules of Practice, or exclusion from further participation in the particular investigation. Rule 8. Service of Subpoenas.
Service of subpoenas issued in formal investigative proceedings shall be effected in the manner prescribed by Rule 14 (b) of the Commission's Rules of Practice.
TABLE III. SHOWING DERIVATIONS OF RULES RE
LATING TO INVESTIGATIONS IN RELATION TO
TABLE IV. SHOWING LOCATION IN RULES RE
LATING TO INVESTIGATIONS OF PROVISIONS OF
Rules Relating to
SUBPART F-CODE OF BEHAVIOR GOVERNING
EX PARTE COMMUNICATIONS
BETWEEN PERSONS OUTSIDE THE COMMISSION AND
SUBPART F-CODE OF BEHAVIOR GOVERNING EX PARTE COMMUNI
CATIONS BETWEEN PERSONS OUTSIDE THE COMMISSION AND DECISIONAL EMPLOYEES
(These sections are published in the Code of Federal Regulations as Title 17, Part 200.110 to 200.114.
Thus should be cited as 17 CFR 200.110 etc.)
Section 200.110 Purpose.
This code of behavior is adopted in conformity with a recommendation of the Administrative Conference of the United States designed to insulate the administrative process from improper influence.
(Adopted April 26, eff. June 1, 1963, Release 33-4600.) Section 200.111 Prohibitions; Application;
Definitions; Limitations. (a) Except as set forth in Section 200.111(g) hereof, no person who is not an employee of the Commission should make any unauthorized ex parte communication directly or indirectly about an on-the-record proceeding to any Commission member or decisional employee or solicit any other person to make an ex parte communication which the solicitor has reason to know is unauthorized; nor should any Commission member or decisional employee in a proceeding request or consider any unauthorized ex parte communication.
(b) “On-the-record” proceedings within the meaning of this Code are all suspension proceedings instituted pursuant to the provisions of Regulations A, B, E and F of the Securities Act of 1933, all review proceedings instituted pursuant to Section 15 A (g) of the Securities Exchange Act of 1934, and all other proceedings where an evidentiary hearing has been ordered pursuant to a statutory provision or rule of the Commission and where the action of the Commission must be taken on the basis of an evidentiary record. In addition an “on-the-record” proceeding may include any other proceeding to which the Commission by specific order makes this Code applicable.
(c) These prohibitions shall commence when the Commission issues an order for hearing: Provided, however, (1) That in suspension proceedings pursuant to Regulations A, B, E and F of the Securi
ties Act of 1933, these prohibitions shall commence when the Commission enters an order temporarily suspending the exemption; and (2) that in proceedings under Section 15A (g) of the Securities Exchange Act of 1934 these prohibitions shall commence from the time that a copy of an application for review has been served by the Secretary upon the registered securities association. These prohibitions shall continue until the time to file a petition for rehearing from the final order of the Commission has expired. In the event a petition for rehearing is filed these prohibitions shall cease if and when the petition for rehearing is denied. The Commission may by specific order entered in a particular proceeding determine that these prohibitions shall commence from some date earlier than the time specified herein or that they shall continue until a date subsequent to the time specified herein.
(d) A "decisional employee” shall consist only of the following:
(1) The hearing officer assigned to the case;
(2) The members of the staff of the Office of Opinions and Review;
(3) The legal and executive assistants to members of the Commission; and
(4) Any other employee of the Commission who has been specifically named by order of the hearing officer or the Commission in the proceeding to assist thereafter in making or recommending a particular decision.
(e) “Participants to the proceeding" shall consist of all parties to the proceeding (including the interested division of the Commission) and any other persons who have been granted limited participation pursuant to the provisions of Rule 9(c) of the Commission's Rules of Practice, 17 CFR 201.9(c).