[Federal Register Volume 67, Number 78 (Tuesday, April 23, 2002)]
[Notices]
[Pages 19783-19784]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-9883]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45764; File No. SR-Amex-2002-10]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 
Thereto by the American Stock Exchange LLC to Establish Examination 
Fees on Member Firms for Which the Amex Is the Designated Examining 
Authority

April 16, 2002.
    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 28, 2002, the American Stock Exchange LLC (``Amex'' 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 the 
Exchange. On March 27, 2002, the Amex amended the proposal.\3\ The Amex 
again amended the proposal on April 4, 2002.\4\ The Amex has designated 
this proposal as one establishing or changing a due, fee, or other 
charge imposed by the Exchange under section 19(b)(3)(A)(ii) of the 
Act,\5\ which renders the proposal effective upon filing with the 
Commission. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See March 26, 2002 letter from Geraldine M. Brindisi, Vice 
President and Corporate Secretary, Amex to Nancy Sanow, Assistant 
Director, Division of Market Regulation (``Division''), SEC and 
attachments (``Amendment No. 1''). Amendment No. 1 completely 
replaces and supersedes the original proposal.
    \4\ See April 3, 2002 letter from Michael Cavalier, Associate 
General Counsel, Amex, to Nancy Sanow, Assistant Director, Division, 
SEC and attachments (``Amendment No. 2''). In Amendment No. 2, the 
Amex provided additional language describing the purpose of the 
proposed rule change, and provided a new Exhibit A that completely 
replaces and supersedes the previous Exhibits A filed with the 
Commission. For purposes of calculating the 60-day abrogation 
period, the Commission considers the abrogation period to have 
commenced on April 4, 2002.
    \5\ 15 U.S.C. 78s(b)(3)(A)(ii).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Amex proposes to amend its Member Fees Schedule to impose 
quarterly Examination Fees on member firms for which the Amex is the 
Designated Examining Authority (``DEA''). The text of the proposed rule 
change is available at the Amex 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 Exchange included statements 
concerning the purpose of and basis for its proposal and discussed any 
comments it received regarding the proposal. The text of these 
statements may be examined at the places specified in Item IV below. 
The Amex 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
    For each member firm for which the Amex serves as the DEA pursuant 
to Rule 17d-1 under the Act,\6\ the Amex proposes to charge an 
Examination Fee of $.00040 per dollar of gross revenue, as reported in 
the firm's FOCUS Report (Form X-17A-5 or replacement form). FOCUS 
Reports are filed either quarterly or annually. This fee is subject to 
a quarterly minimum fee of $750 for firms that engage in public 
business and $250

[[Page 19784]]

for firms that do not engage in public business. In order to reduce the 
potential impact on member firms that operate or are otherwise 
affiliated with other entities subject to the fee, the Exchange will 
impose on member firms operating additional entities (e.g., affiliated 
broker-dealers) 50% of the minimum fees for each additional entity.
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    \6\ 17 CFR 240.17d-1.
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    The proposed fee is intended to permit the Exchange to recover a 
portion of the regulatory expenses incurred by the Exchange in its 
performance of its DEA responsibilities.\7\ The Amex notes that the 
proposed fee is comparable to member fees imposed by the Chicago Board 
Options Exchange and New York Stock Exchange in connection with the DEA 
function of those exchanges.\8\
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    \7\ The fee is not designed to generate revenue. Telephone 
conversation between Michael Cavalier, Associate General Counsel, 
Amex, and Joseph Morra, Special Counsel, Division, SEC, April 15, 
2002. The Commission expects that the Amex will monitor the fee 
carefully, and should the Amex collect more than is necessary to 
offset costs incurred in the performance of its DEA 
responsibilities, the Commission expects the Amex to adjust the fee.
    \8\ See Securities Exchange Act Release Nos. 43144 (August 10, 
2000), 65 FR 50258 (August 17, 2000) (SR-CBOE-2000-24) and 20843 
(April 9, 1984), 49 FR 15042 (April 16, 1984) (SR-NYSE-84-7).
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    The proposed fees will be designated ``Examination Fees'' under the 
Exchange's Member Fees Schedule, attached as Exhibit A. In addition to 
adding the Examination Fees, the Member Fees Schedule has been revised 
to include member fees previously filed with the Commission, including: 
(1) under revised Section II (Initiation Fees), the Qualifying 
Membership Retesting Fee,\9\ the Regular and Options Principal Special 
Transfer (Lease) fee under Article VII, Section 1(c) of the Exchange 
Constitution; \10\ and (2) all fees under revised Section III 
(Membership Fees), including interim member fees,\11\ fees for 
Associate Members and Off-Floor traders,\12\ and Specialist Fees.\13\ 
Former Section III (Permits), which, with the exception of Limited 
Trading Permit fees, included fees that are no longer applicable and 
have been deleted, and former Section IV (Access Fees), which 
previously included only the electronic access fee, have been 
consolidated into revised Section III (Membership Fees).
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    \9\ Securities Exchange Act Release No. 44286 (May 9, 2001), 66 
FR 27187 (May 16, 2001) (SR-Amex-2001-22).
    \10\ Securities Exchange Act Release Nos. 23823 (November 18, 
1986), 51 FR 42955 (November 26, 1986) (SR-Amex-86-28) and 40426 
(September 10, 1998), 63 FR 49766 (September 17, 1988) (SR-Amex-98-
32).
    \11\ Securities Exchange Act Release No. 43016 (July 7, 2000), 
65 FR 44552 (July 18, 2000) (SR-Amex-2000-19).
    \12\ Securities Exchange Act Release No. 43279 (September 11, 
2000), 65 FR 56606 (September 19, 2000) (SR-Amex-2000-44).
    \13\ Securities Exchange Act Release No. 45725 (April 10, 2002) 
(SR-Amex-2002-8).
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2. Statutory Basis
    The Exchange believes that the proposal is consistent with section 
6(b) of the Act \14\ in general and furthers the objectives of section 
6(b)(4) of the Act \15\ in particular in that it is designed to provide 
for the equitable allocation of reasonable dues, fees, and other 
charges among Amex members and issuers and other persons using the 
Amex's facilities.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 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.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    The proposed rule change has become effective pursuant to section 
19(b)(3)(A)(ii) of the Act \16\ and subparagraph (f)(2) of Rule 19b-4 
thereunder,\17\ because it establishes or changes a due, fee, or other 
charge imposed by the Amex. 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 purposes of the Act.\18\
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    \16\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \17\ 17 CFR 240.19b-4(f)(2).
    \18\ See note 4 supra.
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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 proposal 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 in the Commission's 
Public Reference Room. Copies of such filing will also be available for 
inspection and copying at the principal office of the Amex. All 
submissions should refer to file number SR-Amex-2002-10 and should be 
submitted by May 14, 2002.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-9883 Filed 4-22-02; 8:45 am]
BILLING CODE 8010-01-P