[Federal Register Volume 65, Number 44 (Monday, March 6, 2000)]
[Notices]
[Pages 11818-11820]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-5378]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42473; File No. SR-ISE-00-02]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the International Securities Exchange LLC Relating to its Fee 
Schedule

February 29, 2000.
    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 25, 2000, the International Securities Exchange LLC (the 
``Exchange'' or the ``ISE'') 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 ISE. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.\3\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The Commission notes that proposed rule changes relating to 
fees usually are filed pursuant to Section 19(b)(3)(A) and 
subparagraph (f) of Rule 19b-4 thereunder. Because the ISE is a new 
exchange, however, the Commission has determined that publishing the 
proposed rule change for notice and comment is appropriate.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The ISE proposes to adopt fees to be imposed on members of the 
Exchange.

[[Page 11819]]

The text of the proposal is attached as 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, the ISE 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 ISE 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
    ISE proposes to establish its fee schedule for the services it will 
offer to its members and others. This schedule includes membership 
fees, trading fees, and fees for a variety of other services, including 
the installation and maintenance of certain equipment. With these fees, 
ISE intends to recover its costs of operating a trading market and 
building a reserve for future needs. ISE does not intend to use these 
fees to generate an operating profit to distribute to its members. As 
the ISE gains experience in the operation of its market, it will adjust 
its fees to maintain the appropriate balance between costs and 
expenses.
2. Statutory Basis
    The ISE believes that the proposed rule change is consistent with 
the provisions of Section 6(b)(4) of the Act,\4\ which requires that an 
exchange have rules that provide for the equitable allocation of 
reasonable dues, fees and other charges among its members and other 
persons using its facilities.
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    \4\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on 
Competition

    The ISE does not believe that the proposed rule change will result 
in 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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the ISE consents, the Commission will:
    (A) By order approve the proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

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-
0609. 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 will also be 
available for inspection and copying at the principal office of the 
ISE. All submissions should refer to File No. SR-ISE-00-02 and should 
be submitted by March 27, 2000.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority. \5\
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    \5\ 17 CFR 200.30-3(a)(12).

Jonathan G. Katz,
Secretary.

                                   Exhibit A.--Text of the Proposed Rule Change
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     ISE Schedule of fees          Amount          Billable unit            Frequency               Notes
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Electronic Market Place:
    Execution Fees:
         Customer....           $0.05  contract/side........  Transaction.........  Fee waived for 6
                                                                                             months.
         Facilitation            0.15  contract/side........  Transaction.........
         Market Maker
         & Firm Proprietary:
            A.D.V. Less than             0.21  contract/side........  Transaction.........  Based on Exchange
             300,000.                                                                        A.D.V.
            A.D.V. Less than             0.17  contract/side........  Transaction.........  Based on Exchange
             300,001 to                                                                      A.D.V.
             500,000.
            A.D.V. Less than            $0.14  contract/side........  Transaction.........  Based on Exchange
             500,001 to                                                                      A.D.V.
             700,000.
            A.D.V. Over                 $0.12  contract/side........  Transaction.........  Based on Exchange
             700,000.                                                                        A.D.V.
    Comparison Fee...........            0.03  contract/side........  Transaction.........  Fee waived for
                                                                                             Customer Trades for
                                                                                             6 months.
Trading Application Software:
    Installation:
         Non-standard          350.00  Hourly...............  One Time............  Time & Material.
         Services.

[[Page 11820]]

 
    Software License &
     Maintenance:
         Torque:
            First............         1250.00  Terminal.............  Monthly.............
            Second through            $750.00  Terminal.............  Monthly.............
             Fourth.
            Fifth and Over...          250.00  Terminal.............  Monthly.............
         Click.......          500.00  Terminal.............  Monthly.............
    Session/API Fee:.........
         Market              1,000.00  API..................  Monthly.............  Minimum of Two.
         Makers.
         EAM.........          250.00  API..................  Monthly.............
         Ordering              250.00  API..................  Monthly.............
         Routing Service
         Connection Fee.
Access Services
    Access Fees:
         EAM.........          500.00  Member Firm..........  Monthly.............
         Market Maker
         Primary.....        4,000.00  Member Firm..........  Monthly.............
         Competitive.        2,000.00  Member Firm..........  Monthly.............
    Network Fees:............
         Dedicated             250.00  Line.................  Monthly.............
         Line connection.
         Order                 100.00  Line.................  Monthly.............
         Routing Service.
    Gateway:.................
         Installation        5,000.00  Gateway..............  One Time............
Legal & Regulatory:
    Application:
         Primary             7,500.00  Member Firm..........  One Time............
         Market Maker.
         Competitive         5,500.00  Member Firm..........  One Time............
         Market Maker.
         Electronic          3,500.00  Member Firm..........  One Time............
         Access Member.
         Lessor......        1,000.00  Applicant............  One Time............
    Administrative:
         DTR Approval          500.00  Trader...............  One Time............
         U4 Initial             25.00  Registered Person....  One Time............
         Registration.
         Pg 2--U4 for          100.00  Individual...........  One Time............
         Non-Registered
         Persons.
    Regulatory Fee:..........        3,500.00  Member Firm..........  Annual..............
Other Services:
    Training.................          500.00  Daily per Trainee....  As Incurred.........
    Testing..................          100.00  Per candidate........  Per Exam............
    Third Party Developers:
         Set-Up......        1,000.00  Developer............  One Time............
         Usage.......        1,000.00  Monthly..............  Monthly.............
    Disaster Recovery Testing        3,000.00  \1/2\ Day............  As Incurred.........
     & Relocation Services.
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[FR Doc. 00-5378 Filed 3-3-00; 8:45 am]
BILLING CODE 8010-01-P