[Federal Register Volume 60, Number 198 (Friday, October 13, 1995)]
[Notices]
[Pages 53449-53451]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-25445]



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[[Page 53450]]


SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36348; File No. SR-Phlx-95-59]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Philadelphia Stock 
Exchange, Inc. Regarding Registered Representative Fees

October 6, 1995.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on September 14, 1995 the 
Philadelphia Stock Exchange, Inc. (``Phlx'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``SEC'' or ``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the self-regulatory organization. On 
October 3, 1995, the Exchange submitted Amendment No. 1 to the proposed 
rule change.\2\ The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ See Letter from Edith Hallahan, Special Counsel, Regulatory 
Service, Phlx, to Glen Barrentine, Team Leader, Division of Market 
Regulation, SEC, dated October 3, 1995. In Amendment No. 1, the 
Exchange submitted Exhibit B, which was not included with the 
original filing. Exhibit B sets forth the text of the proposed rule 
change.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Phlx, pursuant to Rule 19b-4 of the Act, is increasing its 
registration fee for Registered Representatives (``RR'') associated 
with a member or member organization. Specifically, the Exchange will 
increase the $8.00 fee for all new RR registrants to $10.00. The $8.00 
annual maintenance fee also will increase to $10.00 for each RR. 
Lastly, the $8.00 fee for transfers of RR registrations will increase 
to $10.00. This increase will not become effective until January 1, 
1996, such that any new registration in 1995 would continue to be 
subject to the $8.00 fee, and any maintenance fees paid in 1995 will 
not be charged the difference.

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 self-regulatory organization 
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 self-regulatory organization 
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 Phlx is increasing its fee for the new registration, 
maintenance and transfer of RR registration with the Exchange from 
$8.00 to $10.00. This fee, which was adopted in 1993,\3\ was intended 
to offset Exchange regulatory costs based on the number of 
registrations maintained by member organizations. In adopting the fee, 
the Exchange cited the increasing costs associated with the maintenance 
of a fair and orderly market in Exchange products due to increased 
trading volume and the resultant need for enhanced automated 
surveillance capabilities in an increasingly sophisticated trading 
environment.\4\ The Exchange also cited an increase in the number of 
listed products traded by the Exchange as ``primary issues,'' the 
number of trading vehicles with new features, and the number of 
surveillance investigations conducted, including the resultant 
disciplinary actions.\5\

    \3\ See Securities Exchange Act Release No. 32883 (September 14, 
1993), 58 FR 48922 (September 20, 1993) (approving File No. SR-Phlx-
93-24).
    \4\ See Securities Exchange Act Release No. 32692 (July 29, 
1993), 58 FR 41535 (August 4, 1993) (Notice of Filing of File No. 
SR-Phlx-93-24).
    \5\ Id.
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    The Exchange continues to believe that a strong regulatory program 
is essential to an exchange's ability to maintain a fair and orderly 
market for the investment community. Since the adoption of the RR fees, 
the Exchange has listed additional primary issues and new products, 
triggering additional regulatory costs. The continued automation 
efforts respecting surveillance functions must also be enhanced as well 
as updated to include additional issues; increased costs reflective of 
more sophisticated surveillance technologies are necessary to surveil a 
more technologically sophisticated market.
    Most notably, the Exchange notes that general costs associated with 
its regulatory program continue to rise. Inflationary increases have 
affected the cost of staffing, equipment, technology and other 
continuing expenses, which have risen since the current fee was 
proposed in June 1993.
2. Statutory Basis
    The proposed registration fee increase is consistent with Section 
6(b)(4) of the Act \6\ in that it provides for the equitable allocation 
of reasonable dues, fees, and other charges among the Exchange's 
members and issuers and other persons using its facilities. The 
Exchange notes that the American Stock Exchange, Chicago Board Options 
Exchange, New York Stock Exchange, National Association of Securities 
Dealers, and Pacific Stock Exchange also have implemented similar 
fees.\7\ The Exchange believes that a fee increase from $8.00 to $10.00 
is reasonable in light of increasing regulatory costs.

    \6\ 15 U.S.C. 78f(b)(4).
    \7\ See Securities Exchange Act Release Nos. 33456 (January 11, 
1994), 59 FR 2886 (January 19, 1994) (Notice of Filing and Immediate 
Effectiveness of File No. SR-AMEX-93-44); 36119 (August 18, 1995), 
60 FR 44372 (August 25, 1995) (Notice of Filing and Immediate 
Effectiveness of File No. SR-CBOE-95-31); 35796 (June 1, 1995), 60 
FR 30625 (June 9, 1995) (Notice of Filing and Immediate 
Effectiveness of File No. SR-NYSE-95-20); 32342 (May 20, 1993), 58 
FR 30208 (May 26, 1993) (File No. SR-NASD-93-33); and 31425 
(November 9, 1992), 57 FR 54271 (November 17, 1992) (Notice of 
Filing and Immediate Effectiveness of File No. SR-PSE-92-31).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    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

    The Exchange 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 foregoing rule change constitutes or changes a due, fee, or 
other charge imposed by the Exchange and, therefore, has become 
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and 
subparagraph (e) of Rule 19b-4 thereunder.\9\

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4.
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    At any time within sixty days of the filing of such 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.

[[Page 53451]]


IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549. 
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. Sec. 552, will be available for inspection and copying at 
the Commission's Public Reference Section, 450 Fifth Street, NW., 
Washington, DC 20549. Copies of such filing also will be available for 
inspection and copying at the principal office of the Phlx. All 
submissions should refer to File No. SR-Phlx-95-59 and should be 
submitted by November 3, 1995.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\

    \10\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 95-25445 Filed 10-12-95; 8:45 am]
BILLING CODE 8010-01-M