[Federal Register Volume 62, Number 191 (Thursday, October 2, 1997)]
[Notices]
[Pages 51708-51709]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-26148]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39131; File No. SR-OPRA-97-3]


Options Price Reporting Authority; Notice of Filing and Immediate 
Effectiveness of Amendment to OPRA Plan Revising Professional 
Subscriber Fees and Eliminating the Requirement That Enterprise Rate-
Based Fees Must Be Paid by Electronic Funds Transfer

September 25, 1997.
    Pursuant to Rule 11Aa3-2 under the Securities and Exchange Act of 
1934 (``Exchange Act''), notice is hereby given that on September 9, 
1997, the Options Price Reporting Authority (``OPRA'') \1\ submitted to 
the Securities and Exchange Commission (``SEC'' or ``Commission'') an 
amendment to the Plan for Reporting of Consolidated Options Last Sale 
Reports and Quotation Information (``Plan''). The amendment revises the 
device-based fees paid by professional subscribers for OPRA's Basic 
Service, effective January 1, 1998. In addition, the amendment 
eliminates a requirement that persons electing to pay the enterprise 
rate-based subscriber fee must arrange for payment by electronic funds 
transfer. OPRA has designated this proposal as establishing or changing 
a fee or other charge collected on behalf of all of the OPRA 
participants in connection with access to or use of OPRA facilities, 
permitting the proposal to become effective upon

[[Page 51709]]

filing pursuant to Rule 11Aa3-2(3)(i) under the Exchange Act. The 
Commission is publishing this notice to solicit comments from 
interested persons on the amendment.
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    \1\ OPRA is a National Market System Plan approved by the 
Commission pursuant to Section 11A of the Exchange Act and Rule 
11Aa3-2 thereunder. See Securities Exchange Act Release No. 17638 
(Mar. 18, 1981).
    The Plan provides for the collection and dissemination of last 
sale and quotation information on options that are traded on the 
member exchanges. The five exchanges which agreed to the OPRA Plan 
are the American Stock Exchange (``AMEX''); the Chicago Board 
Options Exchange (``CBOE''); the new York Stock Exchange (``NYSE''); 
the Pacific Exchange (``PCX''); and the Philadelphia Stock Exchange 
(``Phlx'').
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I. Description and Purpose of the Amendment

    The purpose of the amendment is to revise the fees payable to OPRA 
by professional subscribers for access to OPRA's Basic Service, which 
consists of market data and related information pertaining to equity 
and index options (``OPRA Data'').\2\ Professional subscribers are 
those persons who subscribe to OPRA Data and do not qualify for the 
reduced fees charged to nonprofessional subscribers. The Basic Service 
professional subscriber fee was last amended in April 1997,\3\ which, 
in turn, followed an earlier Plan amendment that initially proposed a 
program of fee revisions to be implemented in stages over a four-year 
period.\4\ Subsequently, OPRA amended that filing to propose only the 
first stage of the fee revision program, with the understanding that 
the implementation of the remaining stages would be the subject of 
separate filings.\5\ This amendment proposes the third stage of the fee 
revision program. Like the first two stages, this amendment is intended 
to increase OPRA revenues derived from device-based subscriber fees by 
less than 5% in order to permit a greater share of the costs of 
collecting, consolidating, processing and transmitting options market 
information to be covered by professional subscriber fees. This 
amendment also continues the process of simplifying the structure of 
the professional subscriber fee by reducing the number of member rate 
pricing tiers from four to three for purposes of the volume discount in 
the per-device fee.
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    \2\ Information pertaining to foreign currency options (FCOs) is 
provided through OPRA's FCO Service, which fees are not affected by 
this filing.
    \3\ See Securities Exchange Act Release No. 38467 (April 2, 
1997), 62 FR 17652 (April 10, 1997).
    \4\ See Securities Exchange Act Release No. 36364 (October 12, 
1995), 60 FR 54093 (October 19, 1995).
    \5\ See Securities Exchange Act Release No. 36817 (February 7, 
1996), 61 FR 5827 (February 14, 1996).
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    Similar to the past two years' fee revisions, the proposed changes 
in the level of OPRA's device-based professional subscriber fee will 
reduce or leave the fees paid by the smallest subscribers and increase 
the fees paid by larger subscribers.\6\ Subscriber fees charged to 
members will continue to be discounted by 2% for members who 
preauthorize payment by electronic funds transfer through an automated 
clearinghouse system. OPRA estimates that the overall effect of these 
fee revisions will be to increase revenues derived from device-based 
professional subscriber fees by slightly less than 5%.
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    \6\ The proposed tiers are as follows: (1) for 1-9 devices, 
members pay $15.00 per device and non-members pay $24.00 per device; 
(2) for 10-29 devices, members pay $15.00 per device and non-members 
pay $20.00 per device; (3) for 30-99 devices, members pay $12.00 per 
device and non-members pay $20 per device; (4) for 100-749 devices, 
members pay $12.00 per device and non-members pay $14.50 per device; 
and (5) for 750+ devices, members pay $9.40 per device and non-
members pay $14.50 per device.
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    OPRA proposes the fee revisions as a result of the continued 
implementation of systems and equipment upgrades and additions to 
increase the capacity and enhance the reliability and security of the 
OPRA system. The costs of collection, processing, consolidating and 
disseminating options last sale and bid/ask information have continued 
to increase, and further increases are anticipated. The modest 
increases in device-based fees provided for in the proposed amendment 
are intended to permit some increase in device-based revenues to cover 
these greater expenses.
    OPRA also proposes to amend Section 2 of the Enterprise Rate 
Amendment to its Professional Subscriber Agreement to eliminate the 
requirement that the enterprise rate-based fee must be paid by 
electronic funds transfer. Although this requirement was originally 
included to simplify the billing and collection of OPRA's enterprise 
rate subscriber fee and thereby lower OPRA's costs of administration, 
OPRA's experience over the past year has suggested that a number of 
firms are not yet organized in a manner that facilitates electronic 
funds transfers. Accordingly, OPRA believes that this requirement 
prevented certain firms from taking advantage of the enterprise rate 
agreement when they might otherwise have elected to do so. To eliminate 
this impediment to a broader acceptance of the enterprise rate 
arrangement, OPRA has decided to eliminate the electronic fund transfer 
requirement. Instead, to encourage timely payment of the enterprise 
rate fees, OPRA proposes to impose interest charges on amounts not paid 
by the end of the month following the month in which the fees are 
invoiced. Interest charges will be calculated as the lesser of the 
prime rate plus three percent or the maximum lawful rate of interest.
    Although this amendment was filed for immediate effectiveness 
pursuant to Rule 11Aa3-2(c)(3)(i), the revised subscriber fees will be 
put into effect as of January 1, 1998 to provide subscribers advance 
notice of the changed fees. The elimination of the electronic funds 
transfer requirement for payment of the enterprise rate subscriber fee 
will be effective immediately.

II. Solicitation of Comments

    Pursuant to Rule 11Aa3-2(c)(3), the amendment is effective upon 
filing with the Commission. The Commission may summarily abrogate the 
amendment within 60 days of its filing and require refiling and 
approval of the amendment by Commission order pursuant to Rule 11Aa3-
2(c)(2), if it appears to the Commission that such action is necessary 
or appropriate in the public interest; for the protection of investors 
and the maintenance of fair and orderly markets; to remove impediments 
to, and perfect the mechanisms of, a National Market System; or 
otherwise in furtherance of the purposes of the Exchange Act.
    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, N.W., Washington, D.C. 20549. 
Copies of the submission, all subsequent amendments, and 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 
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 the filing also will be available at 
the principal offices of OPRA. All submissions should refer to file 
number SR-OPRA-97-3 and should be submitted by October 21, 1997.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(29).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-26148 Filed 10-1-97; 8:45 am]
BILLING CODE 8010-01-P