[Federal Register: September 22, 2005 (Volume 70, Number 183)]
[Notices]
[Page 55639-55641]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22se05-65]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-52460; File No. SR-Amex-2005-088]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to an Extension of the Suspension of Transaction Charges for
Specialist Orders in the Nasdaq-100 Tracking Stock[supreg] (QQQQ)
September 16, 2005.
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 August 31, 2005, the American Stock Exchange LLC (``Amex'' 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 Amex. Amex has
designated the proposed rule change as establishing or changing a due,
fee, or other charge imposed by the Exchange pursuant to Section
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\
which renders the proposal effective upon filing with the Commission.
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.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Amex Equity and Exchange Traded
[[Page 55640]]
Funds and Trust Issued Receipts Fee Schedules (the ``Amex Fee
Schedules'') to extend the suspension of transaction charges for
specialist orders in connection with the trading of the Nasdaq-100
Index Tracking Stock[supreg] (Symbol: QQQQ) from September 1, 2005
through October 31, 2005. The text of the proposed rule change is
available on Amex's Web site (http://www.amex.com), at Amex's principal
office, and from the Commission's Public Reference Room.
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 is proposing to extend the suspension of transaction
charges for specialist orders in QQQQ from September 1, 2005 through
October 31, 2005. The current suspension of specialist transaction
charges in QQQQ will otherwise terminate on August 31, 2005.\5\
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\5\ See Securities Exchange Act Release Nos. 52267 (August 15,
2005), 70 FR 49338 (August 23, 2005) and 52268 (August 15, 2005), 70
FR 49336 (August 23, 2005) (proposals previously introducing and
extending this specialist transaction fee waiver).
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Specialist orders in QQQQ executed on the Exchange currently are
charged $0.0037 per share ($0.37 per 100 shares), capped at $300 per
trade (81,081 shares). Effective December 1, 2004, the Nasdaq-100 Index
Tracking Stock[supreg] formerly ``QQQ'' transferred its listing from
Amex to The Nasdaq Stock Market, Inc (``Nasdaq''). It now trades on
Nasdaq under the symbol QQQQ. After the transfer, Amex began trading
QQQQ pursuant to unlisted trading privileges.
The Exchange submits that a suspension of transaction fees for
specialist orders in connection with QQQQ is consistent with Section
6(b)(4) of the Act.\6\ Specifically, the Exchange believes that
extending the suspension of transaction charges for QQQQ specialist
orders is an equitable allocation of reasonable fees among Exchange
members. The fact that specialists have greater obligations than other
members and are also subject to other Exchange fees, in addition to
transaction fees, supports this proposal to temporarily extend the fee
suspension.
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\6\ Section 6(b)(4) states that the rules of a national
securities exchange must provide for ``the equitable allocation of
reasonable dues, fees, and other charges among its members and
issuers and other persons using its facilities.''
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The Exchange notes that specialists are also subject to a variety
of Exchange fees other than transaction charges, such as a floor clerk
fee, a floor facility fee, a post fee, and registration fee.\7\ In
addition, specialists and other floor members of the Exchange are
subject to technology and membership fees.\8\ Certain market
participants, such as customers, non-member broker-dealers and market-
makers, and member broker-dealers are not subject to the majority of
these fees. In addition, specialist units, unlike registered traders
and other floor members, must be sufficiently staffed and provide
adequate technology resources in order to handle the volume of orders
(especially in QQQQ) that are sent to the specialist post at the
Exchange. These operational costs that are incurred by a specialist
further support the Exchange proposal to extend the suspension of QQQQ
transaction fees on specialist orders.
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\7\ The floor clerk, floor facility, post, and registration fees
on an annual basis are $900, $2,400, $1,000, and $800, respectively.
\8\ A technology fee of $3,000 per year is assessed on all
specialists and other floor participants at the Exchange. Annual
membership dues of $1,500 must be paid by all members while annual
membership fees are payable depending on the type of membership and
circumstances. Non-members are not subject to these fees.
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Specialists have certain obligations required by Exchange rules as
well as the Act that do not exist for other market participants. For
example, a specialist pursuant to Amex Rule 170 is required to maintain
a fair and orderly market in his or her assigned securities. Other
members of the Exchange as well as non-member market participants do
not have this obligation. As a result, the Exchange believes that an
extension of the transaction charge fee waiver for specialist orders in
QQQQ is reasonable and equitable.
The Exchange is amending the Amex Fee Schedules to indicate that
transaction charges for specialist orders in connection with QQQQ
executed on the Exchange will be further suspended from September 1,
2005 through October 31, 2005.
2. Statutory Basis
Amex believes that the proposed rule change is consistent with
Section 6(b) of the Act \9\ in general and furthers the objectives of
Section 6(b)(4) of the Act \10\ in particular in that it is intended to
assure the equitable allocation of reasonable dues, fees, and other
charges among its members and issuers and other persons using its
facilities.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
Amex believes that the proposed rule change does not 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
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act \11\ and subparagraph (f)(2) of Rule 19b-4
thereunder \12\ because it establishes or changes a due, fee, or other
charge imposed by the Exchange. 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.
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\11\ 15 U.S.C. 78s(b)(3)(A)(ii).
\12\ 17 CFR 240.19b-4(f)(2).
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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.
); or Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-Amex-2005-088 on the subject line.
[[Page 55641]]
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-9303.
All submissions should refer to File Number SR-Amex-2005-088. 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 Room. Copies of such
filing also will be available for inspection and copying at the
principal office of Amex. 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-Amex-2005-088 and should be submitted on or before October 13, 2005.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 05-18939 Filed 9-21-05; 8:45 am]
BILLING CODE 8010-01-P