[Federal Register Volume 65, Number 208 (Thursday, October 26, 2000)]
[Notices]
[Pages 64274-64275]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-27480]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-43458; File No. SR-BSE-00-14]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Boston Stock Exchange, 
Inc. To Amend Its Transaction Fee Schedule and Floor Operations Fee 
Schedule

October 18, 2000.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 \2\ thereunder, notice hereby is given 
that on September 28, 2000, the Boston Stock Exchange, Inc. (``BSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been substantially prepared by the 
Exchange. 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

    The BSE proposes to amend its Transaction Fee Schedule to increase 
the amount of monthly transaction-related revenue the BSE must generate 
before it shares excess revenue with eligible members. Additionally, 
the BSE proposes to amend its Floor Operations Fee Schedule to include 
a per-trade credit for executions in Exchange Traded Funds (``ETFs'') 
for which registration fees are required. The text of the proposed rule 
change is available at the principal office of the BSE and at the 
Commission.

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 BSE included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received regarding the proposed rule change. 
The text of these statements may be examined at the places specified in 
Item IV below. The BSE 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 purpose of the proposed rule change is to amend the BSE's 
Revenue Sharing Program. Currently, the Exchange's Transaction Fee 
Schedule states that the minimum amount of monthly transaction-related 
revenue the BSE must generate before it shares excess revenue with 
member firms in $1.4 million. The BSE proposes to raise this threshold 
to $1.5 million in order to help meet the budgeted costs of operating 
the Exchange in the upcoming fiscal year.
    In addition, the proposed rule change would amend the Exchange's 
Floor Operations Fee Schedule to include a $2 per-trade credit for each 
trade in certain ETFs that are executed on the BSE and routed to a 
specialist firm on the Exchange. Member firms must pay a registration 
fee for trading certain ETFs on the Exchange. Only those ETFs for which 
member firms must pay a registration fee would be subject to the $2 
per-trade credit. The maximum annual credit that a specialist could 
receive per ETF would be capped at the amount the specialist paid for 
that ETF's annual registration fee.
2. Basis
    The BSE believes that the proposed rule change is permissible under 
section 6(b)(5) of the Act \3\ in that it is designed to promote just 
and equitable principles of trade; to foster cooperation and 
coordination with persons engaged in regulating, clearing, settling, 
processing information with respect to, and facilitating transactions 
in securities; to remove impediments to and perfect the mechanism of a 
free and open market and a national market system; and, in general, to 
protect investors and the public interest. The BSE has stated that the 
proposed rule change is not designed to permit unfair discrimination 
between customers, issuers, brokers, or dealers.\4\
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    \3\ 15 U.S.C. 78f(b)(5).
    \4\ The Exchange also believes that the proposed rule change is 
consistent with section 6(b)(4) of the Act, 15 U.S.C. 78f(b)(4), in 
that it is designed to provide for the equitable allocation of 
reasonable dues, fees, and other charges among its members. 
Telephone conversation between Kathy Marshall, Vice President, and 
John Boese, Assistant Vice President, BSE, and Michael Gaw, 
Attorney-Adviser, Division of Market Regulation, Commission, on 
October 18, 2000.

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[[Page 64275]]

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

    The Exchange does not believe that the proposed rule change would 
impose any burden on competition.

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

    The Exchange has neither solicited nor received comments on the 
proposed rule change.

III. Date of Effectiveness of the Proposed 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) of the Act \5\ and subparagraph 
(f)(2) of Rule 19b-4 \6\ thereunder. At any time within 60 days of the 
filing of the 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 purpose of 
the Act.
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    \5\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \6\ 17 CFR 240.19b-4(f)(2).
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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, 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-BSE-00-14 and 
should be submitted by November 16, 2000.

For the Commission, by the Division of the Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 00-27480 Filed 10-25-00; 8:45 am]
BILLING CODE 8010-10-M