Stocks that appear on the Board’s
list of foreign margin stocks are by definition foreign margin stocks
under Regulation T, making them also margin securities and therefore
eligible for credit at brokers and dealers on the same basis as domestic
margin securities. The list is composed of foreign equity securities
that qualify as margin securities under Regulation T by meeting the
financial requirements of section 220.11(c) and (d). In determining
the qualification of particular foreign equity securities, the Board
has relied on a list of proposed foreign margin stocks submitted by
the New York Stock Exchange (NYSE) based on certification of the securities
eligibility by at least two NYSE members under procedures adopted
by the NYSE and approved by the Board in 1990. These procedures include
periodic recertification of the stocks on the list by at least two
NYSE member firms.
Foreign securities may also qualify as margin securities
if they are deemed by the Securities and Exchange Commission (SEC)
to have a ready market under SEC Rule 15c3-1 (17 CFR 240.15c3-1) or
a no-action position issued that rule. This includes all foreign stocks
in the FTSE World Index Series.
The New York Stock Exchange has informed the Board that
the member firms who usually recertify the stocks on the list have
declined to do so, and plan to rely on the ready-market test instead.
Therefore, effective April 15, 2004, the Board removed all stocks
on the list because it is no longer able to determine that the securities
substantially meet the provisions of section 220.11(d) of Regulation
T, which is necessary for the securities’ continued inclusion on the
list.
The Board will publish a list in the future if it receives
the required information under the approved procedures to establish
the qualification of specific foreign equity securities pursuant to
section 220.11(c) of Regulation T, which is necessary for initial
inclusion on the list.
