[Federal Register Volume 68, Number 137 (Thursday, July 17, 2003)]
[Notices]
[Pages 42443-42444]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-18124]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48157; File No. SR-ISE-2003-14]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendments No. 1 and 2 by 
International Securities Exchange, Inc., Relating to Fee Changes

July 10, 2003.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on April 22, 2003, the International Securities Exchange, Inc. 
(the ``Exchange'' or the ``ISE'') filed with the Securities and 
Exchange Commission the proposed rule change as described in Items I, 
II, and III below, which items have been prepared by the ISE. On May 
15, 2003, the ISE filed Amendment No. 1 to the proposed rule change.\3\ 
On July 8, 2003, the ISE filed Amendment No. 2 to the proposed rule 
change.\4\ 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 letter from Michael Simon, Senior Vice President and 
General Counsel, ISE, to Nancy Sanow, Assistant Director, Division 
of Market Regulation (``Division''), Commission, dated May 14, 2003 
(``Amendment No. 1''). In Amendment No. 1, the ISE clarified that 
the word CLICK represents a registered trademark, as opposed to a 
defined term, and that CLICK/Trade Review Terminal fees do not apply 
to CLICK through VPN.
    \4\ See letter from Michael Simon, Senior Vice President and 
General Counsel, ISE, to Nancy Sanow, Assistant Director, Division, 
Commission, dated July 3, 2003 (``Amendment No. 2''). In Amendment 
No. 2, the ISE revises and replaces the original description 
contained in the purpose section of the notice. In particular, the 
revised purpose section clarifies that CLICK through VPN is a 
different means of connecting to the Exchange's existing trading 
system. ISE also notes that no changes are necessary to the existing 
ISE surveillance and communication rules to accommodate this 
connection, or its trading system.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is proposing changes to its Schedule of Fees in order 
to establish a fee for CLICKTM through Virtual Private 
Network (``VPN''), a new type of technical connection to the Exchange. 
The text of the proposed rule change is available at the Office of the 
Secretary, the ISE, 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 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 \5\
    The Exchange is proposing changes to its Schedule of Fees in order 
to establish a fee for CLICKTM through VPN. A 
CLICKTM through VPN connection is available to Electronic 
Access Members (``EAMs'') of the Exchange. CLICKTM through 
VPN consists of CLICKTM (the same front-end, order entry 
application

[[Page 42444]]

currently widely utilized by EAMs) running over a secure ``virtual 
private network'' over the Internet. CLICKTM through VPN was 
designed for EAMs that want a lower cost, lower bandwith connection to 
the Exchange than the traditional, dedicated network CLICKTM 
connection. The Exchange also envisions that EAMs will use 
CLICKTM through VPN as a back-up or disaster recovery 
connection to the Exchange. CLICKTM through VPN is merely a 
different means of connecting to the Exchange's existing system. It 
does not change the operation of the Exchange's existing system, and it 
does not require any change to the Exchange's surveillance or 
communications rules. As a result, the Exchange is proposing to 
establish a monthly fee of $200 per Terminal for CLICKTM 
through VPN. The purpose of the CLICKTM through VPN Fee is 
to cover the Exchange's costs in connection with maintaining the 
virtual private network.
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    \5\ See Amendment No. 2, supra note 4.
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2. Statutory Basis
    The Exchange believes that the basis under the Act for this 
proposed rule change is the requirement under section 6(b)(4) of the 
Act \6\ that an exchange have an 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. 78(f)(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change does not 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 has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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

    The foregoing rule change has become effective pursuant to section 
19(b)(3) of the Act,\7\ and Rule 19b-4(f)(2) \8\ thereunder because it 
establishes or changes a due, fee, or other charge imposed by the 
Exchange. At any time within 60 days of the filing of such 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.\9\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 19b-4(f)(2).
    \9\ For the purposes of calculating the 60-day abrogation 
period, the Commission considers the proposed rule change to have 
been filed on July 8, 2003, the date ISE filed Amendment No. 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, 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 in the Commission's Public Reference Section. Copies of such 
filing will also be available for inspection and copying at the 
principal office of the ISE. All submissions should refer to the File 
No. ISE-2003-14 and should be submitted by August 7, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-18124 Filed 7-16-03; 8:45 am]
BILLING CODE 8010-01-P