[Federal Register Volume 65, Number 164 (Wednesday, August 23, 2000)]
[Notices]
[Pages 51387-51389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-21522]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-43164; File No. SR-NYSE-00-15]


Self Regulatory Organizations; Notice of Filing and Order 
Granting Accelerated Approval of Proposed Rule Change and Amendment No. 
1 by the New York Stock Exchange, Inc., To Amend Paragraph 902.02 of 
the Exchange's Listed Company Manual Regarding the Initial Listing Fee 
for Tracking Stocks

August 16, 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 April 12, 2000, the New York Stock Exchange, Inc. (``NYSE'' or 
``Exchange'') filed with the Securities and Exchange Commission ``SEC'' 
or ``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by the Exchange. On July 17, 
2000, the Exchange submitted Amendment No. 1 to the proposed rule 
change.\3\ The Commission is publishing this notice to solicit comments 
on the proposed rule change, as amended, from interested persons and to 
approve the proposal and Amendment No. 1 on an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19B-4.
    \3\ Letter from James E. Buck, Senior Vice President and 
Secretary, NYSE, to Nancy Sanow, Assistant Director, Division of 
Market Regulation, Commission, dated July 13, 2000 (``Amendment No. 
1''). In response to comments from Commission staff, the Exchange 
submitted Amendment No. 1 to clarify the purpose and application of 
the proposed rule change.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Exchange proposes to amend Paragraph 902.02 of the Exchange's 
Listed Company Manual by eliminating

[[Page 51388]]

the per-share initial listing fee and imposing a flat fee of $5,000 for 
tracking stocks of listed companies, irrespective of the number of 
shares issued. Below is the text of the proposed rule change. New 
language is italicized.
* * * * *
902.2  Schedule of Current Listing Fees (in effect Jan. 1, 1989)
* * * * *
B. Initial Fee
    The initial fee schedule applies to original listings and to the 
listing of additional shares, new issues of stock, warrants, or similar 
securities which are the subject of subsequent applications. Tracking 
stocks of listed companies will be charged a fixed initial fee of 
$5,000 in lieu of the per share schedule.
* * * * *

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 NYSE 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 III below. The Exchange 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
    The NYSE seeks to eliminate the per-share initial listing fee for 
tracking stocks and instead impose a flat fee of $5,000, irrespective 
of the number of shares issued. The NYSE represents that the proposed 
flat fee for a tracking stock, i.e., stocks of an issuer that are 
intended to track the value of a portion of the issuer's business, 
would apply to a listed company that is listing an additional class of 
stock on the Exchange. The NYSE states that a company that is 
originally listing a single class of common stock on the Exchange would 
pay the regular fee applicable to that type of listing. A listed 
company that is listing an additional class of tracking stock on the 
Exchange would pay the proposed $5,000 flat fee, regardless of the 
original listing criteria under which the company initially listed on 
the Exchange.\4\
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    \4\ Id.
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    The Exchange notes that its listed companies and those companies 
with whom the Exchange discusses possible listing indicate an increased 
desire to utilize tracking stocks to achieve strategic and financial 
goals. The NYSE believes that the proposed rule change is responsive to 
the views and needs of all segments of the issuer community.\5\ The 
NYSE further believes that a reduction in the initial listing fee for 
tracking stocks will place it in a more competitive position vis-a-vis 
this increasingly popular capitalization structure.
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    \5\ Id.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \6\ in general, and furthers the 
objectives of Section 6(b)(4) \7\ in particular, in that it provides 
for the equitable allocation of reasonable dues, fees, and other 
charges among its members and other persons using its facilities.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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

    The Exchange did not receive any written comments on the proposed 
rule change.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended, is consistent with the Act. Persons making written 
submissions should file six copies thereof with the Secretary, 
Securities and Exchange Commission, 450 Fifth Street, NW, Washington, 
DC 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 Exchange. All submissions should refer to File 
No. SR-NYSE-00-15 and should be submitted by September 13, 2000.

IV. Commission's Findings and Order Granting Accelerated Approval 
of the Proposed Rule Change

    The Commission has reviewed the NYSE's proposed rule change and 
finds, for the reasons set forth below, that the proposal, as amended, 
is consistent with the requirements of Section 6 of the Act \8\ 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) of the Act,\9\ because it provides for 
the equitable allocation of reasonable dues, fees and other charges 
among its members and other persons using its facilities.\10\
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    \8\ 15 U.S.C. 78f.
    \9\ 15 U.S.C. 78f(b)(4).
    \10\ In approving this rule, the Commission has considered its 
impact on efficiency, competition, and capital formation. 15 U.S.C. 
78c(f).
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    The Commission finds that the NYSE's proposed flat fee for tracking 
stocks is a reasonable response to the increased desire of companies to 
utilize this capitalization structure. The Commission further finds 
good cause for approving the proposed rule change and Amendment No. 1 
prior to the thirtieth day after the date of publication of notice 
thereof in the Federal Register. The Exchange requested that the 
Commission accelerate the effective date of the proposed rule change so 
that the Exchange could institute the fee reduction as quickly as 
possible. The Commission agrees that approval of this request would 
enable issuers to promptly benefit from the proposed rule change. 
Accordingly, the Commission believes that there is good cause, 
consistent with Sections 6(b)(5) and 19(b)(2) of the Act,\11\ to 
approve the proposal, as amended, on an accelerated basis.
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    \11\ 15 U.S.C. 78f(b)(5) and 78s(b)(2).
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V. Conclusion

    It Is Therefore Ordered, pursuant to Section 19(b)(2) of the 
Act,\12\ that the proposed rule change (SR-NYSE-00-15), as amended, is 
hereby approved on an accelerated basis.
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    \12\ 15 U.S.C. 78s(b)(2).


[[Page 51389]]


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    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 00-21522 Filed 8-22-00; 8:45 am]
BILLING CODE 8010-01-M