[Federal Register: October 29, 2003 (Volume 68, Number 209)]
[Notices]
[Page 61710-61711]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29oc03-78]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-48685; File No. SR-NYSE-2003-32]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the New York Stock Exchange,
Inc. Relating to the Listing Fees for Closed-End Funds
October 23, 2003.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice hereby is given that
on October 9, 2003, the New York Stock Exchange, Inc. (``NYSE'' 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 NYSE
has represented that the proposal meets the criteria of paragraph
(f)(6) of Rule 19b-4 and, therefore, may take effect immediately. 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 NYSE proposes to amend Section 902.02 of its Listed Company
Manual to implement a $75,000 cap on the collective original listing
fees payable by any two or more closed-end funds from the same fund
family listing at the same time. Below is the text of the proposed rule
change. Proposed new language is italicized.
* * * * *
Listed Company Manual
902.00 Listing Fees
* * * * *
902.02 Schedule of Current Listing Fees
* * * * *
A. Original Listing Fee
A special charge of $36,800 in addition to initial fees (described
below) is payable in connection with the original listing of a
company's stock. In any event, each issuer is subject to a minimum
original listing fee of $150,000 inclusive of the special charge
referenced in the preceding sentence.
The special charge is also applicable to an application which in
the opinion of the Exchange is a ``back-door listing''. See Para.
703.08 (F) for definition.
Original listings of closed-end funds are not subject to either the
special charge or to the minimum original listing fee. Closed end funds
will instead pay an original listing fee based on the number of shares
outstanding upon listing. Closed-end funds with up to 10 million shares
outstanding will be subject to a $20,000 original listing fee, closed
end funds with greater than 10 million shares up to 20 million shares
outstanding will be subject to a $30,000 original listing fee, and
closed end funds with more than 20 million shares outstanding will be
subject to a $40,000 original listing fee. Original listings of closed-
end funds are also not subject to the initial fees described below.
If two or more closed-end funds from the same fund family list at
the same time, the Exchange will cap the collective original listing
fee for those funds at $75,000. A fund family consists of closed end
funds with a common investment adviser or investment advisers who are
``affiliated persons'' as defined in Section 2(a)(3) of the Investment
Company Act of 1940, as amended.
* * * * *
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 NYSE included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received regarding the proposed rule change.
The text of these statements may be examined at the places specified in
Item IV below. The NYSE 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
In recognition of the increasing cost pressures facing closed-end
funds, the Exchange recently reduced the original listing fees
applicable to closed-end funds by establishing a three-tiered structure
based on the number of shares outstanding.\3\ Closed-end funds with up
to 10 million shares outstanding are subject to a $20,000 original
listing fee; funds with greater than 10 million shares up to 20 million
shares outstanding are charged a $30,000 original listing fee; and
funds with more than 20 million shares outstanding are subject to a
$40,000 original listing fee.
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\3\ See Securities Exchange Act Release No. 48360 (August 18,
2003), 68 FR 51045 (August 25, 2003) (SR-NYSE-2003-22).
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The Exchange states that it inadvertently omitted in SR-NYSE-2003-
22 an additional proposal to impose a cap of $75,000 on the collective
original listing fees payable by two or more closed-end funds from the
same fund family listing at the same time. Accordingly, the Exchange
proposes that there be a cap of $75,000 on the collective original
listing fees payable by a group of two or more closed-end funds from
the same fund family listing at the same time. A fund family consists
of closed-end funds with a common investment adviser or investment
advisers who are ``affiliated persons'' as defined in Section 2(a)(3)
of the Investment Company Act of 1940.\4\ The Exchange clarifies that
the $75,000 cap is available regardless of whether the funds are
transferring from another market or making an initial issuance of
shares. In fact, if some of the funds listing at the same time are
transferring to the Exchange, and others are conducting an initial
public offering, the funds would still be eligible for the collective
$75,000 cap.
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\4\ 15 U.S.C. 80a-2(a)(3).
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2. Statutory Basis
The NYSE believes that the basis for the proposed rule change is
Section 6(b)(4) of the Act,\5\ which requires that an exchange have
rules that provide for the equitable allocation of reasonable dues,
fees, and other charges among its
[[Page 61711]]
members and issuers and other persons using its facilities.
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\5\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The NYSE does not believe that the proposed rule change would
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
The NYSE has neither solicited nor received written comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange asserts that, because the foregoing proposed rule
change does not: (i) Significantly affect the protection of investors
or the public interest; (ii) impose any significant burden on
competition; and (iii) become operative for 30 days from the date on
which it was filed (or such shorter time as the Commission may
designate), it may become effective pursuant to Section 19(b)(3)(A) of
the Act \6\ and Rule 19b-4(f)(6) thereunder.\7\ At any time within 60
days of the filing of the proposed rule change, the Commission may
summarily abrogate such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act.\8\
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\6\ 15 U.S.C. 78s(b)(3)(A).
\7\ 17 CFR 240.19b-4(f)(6).
\8\ See 15 U.S.C. 78s(b)(3)(C).
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A proposed rule change filed under Rule 19b-4(f)(6) normally would
not become operative prior to 30 days after the date of the filing.
However, Rule 19b-4(f)(6) permits the Commission to designate a shorter
time if such action is consistent with the protection of investors and
the public interest. The Exchange has requested that the Commission
designate the proposed rule change operative immediately upon filing.
The Commission believes that capping the initial listing fees payable
by any two or more closed-end funds from the same fund family will
benefit those who invest in such funds by reducing the costs associated
with the issuance of the shares. Accordingly, the Commission hereby
determines to waive the 30-day pre-operative period, and the proposed
rule change becomes operative immediately.\9\
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\9\ For purposes only of accelerating the operative date of this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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Rule 19b-4(f)(6) also requires the self-regulatory organization
submitting the proposed rule change to give the Commission written
notice of its intent to file the proposed rule change, along with a
brief description and text of the proposed rule change, at least five
business days prior to the date of filing, or such shorter time as
designated by the Commission. The NYSE has requested that the
Commission waive the five-day pre-filing requirement, and the
Commission hereby grants that request.
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. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street NW., Washington DC 20549-0609.
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 at the
Commission's Public Reference Room. Copies of such filing will also be
available for inspection and copying at the principal office of the
Exchange. All submissions should refer to File No. SR-NYSE-2003-32 and
should be submitted by November 19, 2003.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-27227 Filed 10-28-03; 8:45 am]
BILLING CODE 8010-01-P