[Federal Register Volume 67, Number 199 (Tuesday, October 15, 2002)]
[Notices]
[Pages 63716-63717]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-26153]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-46619; File No. SR-BSE-2002-17]


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 To Revise the Monthly 
Transaction Related Revenue It Must Generate Before Sharing Excess 
Revenue With Eligible Firms

October 8, 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 September 27, 2002, the Boston Stock Exchange, Incorporated (``BSE'' 
or ``Exchange'') 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 
Exchange. The Exchange has designated this proposal as one establishing 
or changing a due, fee, or other charge imposed by the BSE under 
Section 19(b)(3)(A)(ii) of the Act,\3\ which renders the proposal 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

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 revise 
the monthly transaction related revenue the BSE must generate before it 
shares excess revenue with eligible firms. The text of the proposed 
rule change is available at the BSE and at the Commission.

[[Page 63717]]

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 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 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 purpose of the proposed rule change is to amend the Revenue 
Sharing Program that is currently part of the BSE's Transaction Fee 
Schedule. Currently, the minimum amount of monthly transaction related 
revenue the BSE must generate before it shares excess revenue with 
eligible member firms is $1,700,000. The BSE proposes to revise this 
amount to $1,900,000, to meet the budgeted costs of operating the 
Exchange in the upcoming fiscal year.\4\
---------------------------------------------------------------------------

    \4\ The Exchange notes that this revision would apply to the 
Transaction Fee Schedule currently in place for the BSE. On 
September 11, 2002, the Commission approved a proposed rule change 
that amended the BSE's Floor Operations and Transactions Fees 
Schedules. See Securities Exchange Act Release No. 46488 (September 
11, 2002), (SR-BSE-2002-11). Normally, such changes are sought to 
run concurrent with the BSE's fiscal year, which begins on October 
1. However, as part of the changes to its overall fee structure, the 
BSE sought to replace its current revenue sharing program with two 
new programs. The amendments to the BSE's revenue sharing program 
were the subject of a separate, but related, rule proposal, which 
has been published for notice and public comment. See Securities 
Exchange Act Release No. 46496 (September 19, 2002), (SR-BSE-2002-
10). In seeking the changes to its Transaction Fee Schedule sought 
in SR-BSE-2002-11, which have been approved by the Commission, the 
Exchange stated that it would implement such changes only upon 
approval of its new revenue sharing programs, which were the basis 
of SR-BSE-2002-10. Since SR-BSE-2002-10 is still pending with the 
Commission, the BSE will not amend its Transaction Fee Schedule on 
October 1, 2002. Thus, the existing Transaction Fee Schedule (the 
one that was operative for the BSE's fiscal year that ends on 
September 30, 2002) will remain in effect, until such time as it is 
amended in response to Commission action on SR-BSE-2002-10.
---------------------------------------------------------------------------

    The Exchange is seeking to amend only its existing revenue sharing 
program, and only in the area of the amount of revenue the Exchange 
must generate before sharing excess revenue. No changes are being 
sought to the fundamental structure of the existing program.
    The BSE is seeking to make this change operative only until the 
Commission acts on SR-BSE-2002-10. Upon such Commission action, the BSE 
will either implement the proposed revenue sharing program detailed in 
SR-BSE-2002-10, and the accompanying changes to the Transaction Fee 
Schedule that have been approved in SR-BSE-2002-11, or reevaluate its 
revenue sharing program and accompanying fee schedule.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
Section 6(b) of the Act,\5\ in general, and furthers the objectives of 
Section 6(b)(4) of the Act,\6\ in particular, in that the proposed rule 
change provides for the equitable allocation of reasonable dues, fees, 
and other charges among the BSE's members.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

    The Exchange has neither solicited nor received comments on 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 \7\ and subparagraph (f)(2) of Rule 19b-4 
thereunder,\8\ because it involves a due, fee, or other charge. 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.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \8\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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 Exchange. All 
submissions 2 should refer to file number SR-BSE-2002-17, and should be 
submitted by November 5, 2002.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-26153 Filed 10-11-02; 8:45 am]
BILLING CODE 8010-01-P