[Federal Register: June 18, 2004 (Volume 69, Number 117)]
[Notices]
[Page 34210-34211]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18jn04-157]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-49828; File No. SR-PCX-2004-51]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Pacific Exchange, Inc. Amending the Designated Options
Examination Authority Fee on a Retroactive Basis
June 8, 2004.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on June 1, 2004, the Pacific Exchange, Inc. (``PCX'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the Exchange. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is proposing to amend its Schedule of Fees and Charges
by changing the Designated Options Examination Authority (``DOEA'') fee
charged to its members, effective retroactively as of January 2004.\3\
The text of the proposed rule change is available at the Commission and
the PCX.
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\3\ On April 15, 2004, the Exchange filed an identical amendment
to its Schedule of Fees and Charges, as immediately effective. See
Securities Exchange Act Release No. 49671 (May 7, 2004), 69 FR 27665
(May 17, 2004) (File No. SR-PCX 2004-32). Because the Exchange also
seeks to apply the amendment to the DOEA fee on a retroactive basis,
the Exchange is submitting this proposal for notice and comment.
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II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend its Schedule of Fees and Charges to
retroactively establish the DOEA fee that recently became effective
pursuant to a previous PCX proposed rule change.\4\ Previously, the
Exchange assessed a $2000/month DOEA fee in order to recover the
Exchange's costs of DOEA examinations for which it would be
responsible.\5\ At the time the Exchange set the original DOEA fee, it
contemplated it would conduct some examinations itself and would
contract with the NASD to conduct other examinations. For that reason,
the Exchange adopted a flat fee of $2000/month based upon the
preexisting $2000/month Designated Examination Authority (``DEA'') fee.
The Exchange anticipated that the costs of the examinations, whether
conducted by the NASD or by the Exchange, would be about the same as
the costs of the DEA examinations.
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\4\ Id.
\5\ See Securities Exchange Act Release No. 47577 (March 26,
2003), 68 FR 16109 (April 2, 2003) (File No. SR-PCX 2003-03).
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The Exchange has relied exclusively on the NASD to conduct its DOEA
examinations and as a result, amended its Schedule of Fees and Charges
to change its DOEA fee from $2000/month
[[Page 34211]]
to a fee that would be a pass through of the costs that the Exchange
pays the NASD for conducting DOEA examinations, plus a 17%
administrative charge.\6\ In the previous proposed rule change, the
Exchange represented that the 17% percent administration fee that it
proposed to charge relates directly to costs actually incurred by the
Exchange in the administration of this program. The Exchange now
proposes to extend this relief retroactively back to all applicable
fees due since January 2004.
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\6\ See note 3 supra.
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2. Statutory Basis
The Exchange believes that the proposal is consistent with section
6(b) of the Act,\7\ in general, and section 6(b)(4) of the Act,\8\ in
particular, in that it provides for the equitable allocation of
reasonable fees among its members.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
Written comments were neither solicited nor received with respect
to the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such other period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission will:
(A) By order approve the proposed rule change, or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-PCX-2004-51 on the subject line.
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW.,
Washington, DC 20549-0609.
All submissions should refer to File Number SR-PCX-2004-51. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Section, 450 Fifth Street,
NW., Washington, DC 20549-0609. Copies of such filing also will be
available for inspection and copying at the principal office of the
PCX. All comments received will be posted without change; the
Commission does not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-PCX-
2004-51 and should be submitted on or before July 9, 2004.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-13844 Filed 6-17-04; 8:45 am]
BILLING CODE 8010-01-P