[Federal Register Volume 61, Number 190 (Monday, September 30, 1996)]
[Notices]
[Pages 51133-51134]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24992]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37714; File No. SR-NYSE-96-20]


Self-Regulatory Organizations; New York Stock Exchange, Inc.; 
Order Granting Approval to Proposed Rule Change Relating to Retroactive 
Reduction of the Odd-Lot Equity Transaction Charges and the Specialist 
Odd-Lot Charge

    On July 23, 1996, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange'') submitted to the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to retroactively reduce its odd-lot equity 
transaction charges and its specialist odd-lot charge.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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    The proposed rule change was published for comment in the Federal 
Register on August 6, 1996.\3\ No comments were received on the 
proposal. This order approves the proposal.
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    \3\ Securities Exchange Act Release No. 37499 (July 30, 1996), 
61 FR 40870.

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[[Page 51134]]

    The proposed amendment would make retroactive, from January 1, 
1996, the reduced fee schedule for Odd-Lot Equity Transaction Charges 
and the Specialist Odd-Lot Charge that was published by the commission 
on July 12, 1996. \4\ In that proposal, the NYSE incorporated odd-lot 
orders into its ``no charge'' policy for SuperDot equity public agency 
transactions, but excluded odd-lot orders of nonmember competing market 
makers from this policy. In addition, the NYSE lowered the Specialist 
Odd-Lot Charge from $0.004 per share to $0.00135 per share.
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    \4\ See Securities Exchange Act Release No. 37430 (July 12, 
1996), 61 FR 37784 (publishing the notice and immediate 
effectiveness of File No. SR-NYSE-96-14).
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    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange. Specifically, 
the Commission believes the proposal is consistent with Section 
6(b)(4),\5\ Section 6(b)(5),\6\ and Section 6(b)(8).\7\
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    \5\ 15 U.S.C. 78f(b)(4) (requiring, in short, that an exchange's 
rules provide for the equitable allocation of reasonable fees).
    \6\ 15 U.S.C. 78f(b)(5) (requiring, in pertinent part, an 
exchange's rules be designed to promote just an equitable principles 
of trade, perfect the mechanism of a free and open market, and, in 
general, to protect investors and the public interest; and not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers).
    \7\ 15 U.S.C. 78f(b)(8) (requiring the rules of an exchange not 
to impose unnecessary burdens on competition).
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    The Commission notes that the effect of the current proposal is to 
retroactively apply, from January 1, 1996, a fee schedule that has been 
in place since June 13, 1996.\8\ Implementation of the fee will result 
in a rebate of fees to certain NYSE members. No additional fees will be 
collected as a result of this proposal. The Commission believes that 
rebating the covered charges in the manner provided is consistent with 
the Commission's findings and analysis articulated in the order 
approving a NYSE proposal to exclude orders of nonmember competing 
market makers from its ``no charge'' policy for orders of 100 to 2,099 
shares.\9\
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    \8\ See Securities Exchange Act Release No. 37430 (July 12, 
1996), 61 FR 37784 (publishing the notice and immediate 
effectiveness of File No. SR-NYSE-96-14). The Commission notes that 
it did not receive any comment letters concerning this fee change.
    \9\ See Securities Exchange Act Release No. 37273 (June 4, 
1996), 61 FR 29438 (approving File No. SR-NYSE-95-47). Hence, the 
Commission's views and conclusions contained in Securities Exchange 
Act Release No. 37273 are incorporated by reference into this order.
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    In addition, the Commission believes that rebating the Specialist 
Odd-Lot Charge reduction is consistent with the Act because it will 
infuse capital into these specialist firms. This capital, in turn, 
could be used for increasing the depth and liquidity of the market.
    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
\10\ that the proposed rule change (SR-NYSE-96-20) is approved.

    \10\ 15 U.S.C. 78s(b)(2).
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    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-24992 Filed 9-27-96; 8:45 am]
BILLING CODE 8010-01-M