[Federal Register Volume 62, Number 53 (Wednesday, March 19, 1997)]
[Notices]
[Pages 13204-13205]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6894]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38394; File No. SR-PHLX-97-09]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Philadelphia Stock 
Exchange, Inc. Relating to a New Technology Fee and Amended Transfer 
Fee

March 12, 1997.
    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 February 27, 1997, 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 PHLX. 
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) (1988).
    \2\ 17 CFR 240.19b-4 (1991).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The PHLX proposes to amend its schedule of dues, fees and charges 
to: (a) increase the existing transfer fee from $300 to $500; and (b) 
adopt a technology fee of $100 per month applicable to all members and 
foreign currency option participants not also holding legal title to a 
PHLX regular membership.

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 PHLX 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 PHLX 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

    The purpose of the proposed rule change is to amend the PHLX's fee 
schedule in two ways. First, the Exchange's transfer fee, currently 
$300, will be increased to $500. This fee is imposed on the transferee 
at the time of transfer of legal or equitable title to any PHLX regular 
membership or foreign currency option participation. Transfers require 
significant staff time to process. Processing involves drafting letters 
and invoices to the parties, posting the notice in the membership 
bulletin, creating and updating membership files and changing the 
Exchange's data base to reflect the transfer. Over the last eight 
years, the number of transfers each week has dramatically increased, 
thus, placing an increased burden on staff time and resources. The 
transfer fee increase reflects the higher costs of processing these 
transfers. This fee was last increased from $200 to $300 in 1989.\3\ 
The new fee will go into effect on March 1, 1997.
---------------------------------------------------------------------------

    \3\ Securities Exchange Act Release No. 26468 (January 18, 
1989), 54 FR 3713 (January 25, 1989) (File No. SR-PHLX-88-45).
---------------------------------------------------------------------------

    The second change will be to adopt a technology fee which will be 
assessed upon all PHLX regular membership holders and foreign currency 
option participants who do not also possess a PHLX regular membership. 
The fee will be a monthly $100 fee which will be billed on March 1, 
1997, for the period March 1 to June 30, 1997, ($400) and on July 1, 
1997, for the period July 1 through December 31, 1997 ($600). The new 
technology fee will reflect the costs of needed upgrades to the 
operating systems on the three trading floors, system software 
modifications, year 2000 modifications and hardware upgrades to handle 
expected increased trading volumes and anticipated increases due to 
Securities Industry Automation Corporation and Options Price Reporting 
Authority's communication changes. Additionally, system development 
costs for new risk management systems, order handling rule revisions, 
specialized quote feeds and new products will be captured by this fee.
    The proposed rule change is consistent with Section 6 of the Act in 
general, and in particular, with Section 6(b)(4), in that it provides 
for the equitable allocation of reasonable dues, fees and other charges 
among its members and other persons using its facilities.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The PHLX does not believe that the proposed rule change will impose 
any inappropriate burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    The foregoing rule change has become effective on February 27, 
1997, pursuant to Section 19(b)(3)(A) of the Act \4\ and subparagraph 
(e)(2) of Rule 19b-4 \5\ thereunder, because the proposed rule change 
establishes or changes a due, fee, or other charge. At any time within 
60 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.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(e).
---------------------------------------------------------------------------

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. 552, will be available for inspection and copying in the 
Commission's Public Reference Room. Copies of such filing will also be 
available for inspection and copying at the principal office of the 
PHLX. All submissions should refer to File No. SR-PHLX-97-09 and should 
be submitted by April 9, 1997.


[[Page 13205]]


    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\6\
---------------------------------------------------------------------------

    \6\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-6894 Filed 3-18-97; 8:45 am]
BILLING CODE 8010-01-M