[Federal Register Volume 63, Number 195 (Thursday, October 8, 1998)]
[Notices]
[Pages 54175-54176]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-26999]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-40496; File No. SR-PCX-98-42]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc.
Relating to Equity Rate Reduction and Simplification
September 29, 1998.
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 September 8, 1998, the Pacific Exchange, Inc. (``PCX'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'' or ``SEC'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by PCX. 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.
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
PCX proposes to change its Schedule of Fees and Charges for
Exchange Services for equity trade-related transaction charges. the
text of the proposed rule change is contained in Exhibit A.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, PCX 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. PCX has prepared summaries, set forth in Sections A, B,
and C below, of the most significant aspects of such statements.
A. Self-Regualtory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Currently, under the Schedule of Fees and Charges for Exchange
Services, members are subject to equity trade-related charges based on
cumulative billable trade value per month. The value charges are
incremental and resulting charges are subject to discounts for
automated trades. The Exchange proposes to reduce transaction charges
and simplify the way volume based charges are calculated. Specifically,
the Exchange proposes to eliminate listed comparison charges, reduce
transaction fees and establish a share-based structure with four tiers
(as opposed to the current value-based structure with seven tiers and
twelve discount categories). The Exchange also proposes to cap block
transactions at 20,000 shares, and to continue to waive transaction and
off-board comparison charges in AMEX-listed issues.
[[Page 54176]]
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) \3\ of the Act, in general, and furthers the objectives of
Section 6(b)(4) \4\ in particular, because it provides 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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\3\ 15 U.S.C. 78f(b).
\4\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
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
Written comments on the proposed rule change were neither solicited
nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
The foregoing rule change establishes or changes a due, fee, or
other charge imposed by the Exchange and, therefore, has become
effective pursuant to Section 19(b)(3)(A)(ii) \5\ and subparagraph
(e)(2) of Rule 19b-4 thereunder.\6\ At any time within 60 days of the
filing of 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.\7\
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\5\ 15 U.S.C. 78s(b)(3)(A)(ii).
\6\ 17 CFR 240.19b-4(e)(2).
\7\ In reviewing this proposal, the Commission has considered
the proposal's impact on efficiency, competition, and capital
formation. 15 U.S.C. 78c(f).
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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. 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, 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 at the
Commission's Public Reference Room. Copies of such filing also will be
available for inspection and copying at the principal office of the
PCX.
All submissions should refer to File No. SR-PCX-98-42 and should be
submitted by October 29, 1998.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
EXHIBIT A--Text of the Proposed Rule Change \9\
SCHEDULE OF FEES AND CHARGES FOR EXCHANGE SERVICES
* * * * *
PCX EQUITIES: TRADE-RELATED CHARGES
* * * * *
EXCHANGE TRANSACTIONS
Cumulative Billable Shares Per Month
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\9\ New text is in italics. Deleted text is in brackets.
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First 4 million shares: $0.31 per 100 shares
Next 10 million shares: $0.17 per 100 shares
Next 8 million shares: $0.09 per 100 shares
Over 22 million shares: $0.05 per 100 shares
All trades capped at 20,000 shares.
[EXCHANGE TRANSACTIONS
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Charge per
$1,000 of
Cumulative billable trade value per month trade
value*
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$0 to $50,000,000.......................................... $0.13
50,000,001 to.............................................. 0.10
150,000,001 to............................................. 0.08
350,000,001 to............................................. 0.06
500,000,001 to............................................. 0.04
650,000,001 to............................................. 0.02
Over 800,000,000........................................... 0.01
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*Value charges are incremental; i.e., first $50,000,000 of monthly
business is charged $0.13 rate, next $100,000,000 is charged $0.10
rate, etc. Resulting charges are then subject to discounts shown below
for any automated trades.
DISCOUNT AND CAPS
Automated Trade Discounts
The following discounts from the above transaction charges apply
to automated trades:
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$150 to
Under $150 $350 $350 to
Trade size (shares) million of million of $500
trade trade million of
value value trade value
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100 to............................. 35% 30% 25%
401 to............................. 25 20 15
601 to............................. 20 15 5
801 to............................. 10 5 2.5
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Block Trades
Transaction charges for block trades of 5,000 shares or more are
subject to a minimum charge of $15 per trade side and a maximum
charge of $75 per trade side.
Cap on Transaction Charges
Aggregate monthly transaction charges are subject to a cap of
$0.45 per 100 shares]
OFFBOARD TRADE RECORDING AND COMPARISON
$0.05 per 100 shares for each side of individual stock, warrant,
or rights for [listed or] offboard trades submitted for comparison
(comparison charges are capped at 20,000 shares per trade side;
minimum of $0.05, maximum of $10).
$0.03 per $1,000 bond face value for each side of individual
bond trade submitted for comparison (minimum of $0.03, maximum of
$3).
AMEX-LISTED ISSUES
Trades in AMEX-Listed equity issues are not subject to
transaction or comparison charges.
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[FR Doc. 98-26999 Filed 10-7-98; 8:45 am]
BILLING CODE 8010-01-M