[Federal Register Volume 68, Number 177 (Friday, September 12, 2003)]
[Notices]
[Pages 53773-53774]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-23227]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48449; File No. SR-Phlx-2003-55]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 
Thereto by the Philadelphia Stock Exchange, Inc. to Revise Its Schedule 
of Dues, Fees and Charges to Adopt a Registered Representative 
Termination Fee

    September 4, 2003.
    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 July 30, 2003, the Philadelphia Stock Exchange, Inc. (``Phlx'' or 
``Exchange'') submitted to the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange. The Phlx 
amended its proposal on August 21, 2003 \3\ and August 28, 2003.\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 (with exhibits) from Murray L. Ross, Vice 
President and Corporate Secretary, Phlx, to Cyndi Rodriguez, Special 
Counsel, Division of Market Regulation (``Division''), Commission, 
dated August 21, 2003 (``Amendment No. 1''). In Amendment No. 1, the 
Phlx added a footnote in its schedule of dues, fees and charges 
clarifying the group of individuals that would be covered under its 
fees for the registered representative categories and provided an 
anticipated implementation date for the registered representative 
termination fee.
    \4\ See letter (with exhibits) from Murray L. Ross, Vice 
President and Corporate Secretary, Phlx, to Cyndi Rodriguez, Special 
Counsel, Division, Commission, dated August 28, 2003, replacing Form 
19b-4 in its entirety (``Amendment No. 2''). In Amendment No. 2, the 
Phlx made technical changes to its schedule of dues, fees and 
charges to comply with Form 19b-4 and clarified in its discussion 
that the implementation date for the proposal was August 18, 2003 
and that proposed footnote twenty (20) in its fee schedule would 
specify that the registered representatives categories include 
registered options principals, general securities representatives, 
general securities sales supervisors and United Kingdom limited 
general securities registered representatives and shall not apply to 
``off-floor'' traders, as defined in Phlx Rule 604(e).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Phlx proposes to amend its schedule of dues, fees and charges 
to adopt a registered representative \5\ termination fee of $30.00.\6\ 
The Exchange implemented this registered representative termination fee 
on August 18, 2003, a date agreed upon with the National Association of 
Securities Dealers, Inc. (``NASD''), which notified the Exchange that 
they were prepared to bill and collect the termination fee consistent 
with current practice.\7\
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    \5\ Registered representative categories include registered 
options principals, general securities representatives, general 
securities sales supervisors and United Kingdom limited general 
securities registered representatives.
    \6\ See Exchange Rule 604, Registration and Termination of 
Registered Persons. This proposal, as amended, does not apply to 
``off-floor'' traders, as defined in Phlx Rule 604(e). The Phlx 
states that off-floor traders are assessed a separate fee and are 
not charged the Exchange's registered representative initial, 
renewal, or transfer fees. See Securities Exchange Act Release No. 
47124 (January 3, 2003), 68 FR 1497 (January 10, 2003) (SR-Phlx-
2002-84).
    \7\ The termination fee was charged beginning on August 18, 
2003. Currently, the NASD bills and collects the Exchange's as well 
as other exchanges' registered representative initial, renewal and 
transfer fees.
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    Furthermore, the Exchange proposes to add new footnote number 
twenty (20) and renumbered former footnote number twenty (20) as 
footnote number twenty-one (21). New footnote number twenty (20) 
specifies that the registered representatives categories include 
registered options principals, general securities representatives, 
general securities sales supervisors and United Kingdom limited general 
securities registered representatives and shall not apply to ``off-
floor'' traders, as defined in Phlx Rule 604(e), thereby clarifying 
coverage of the fees.
    The schedule of dues, fees and charges is available at the Office 
of the Secretary, the Phlx, 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 the proposed rule change, as 
amended, 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 parts of 
such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Phlx proposes to amend its schedule of dues, fees and charges 
to adopt a registered representative termination fee of $30.00. The 
Exchange states that the purpose of the proposed rule change, as 
amended, is to generate revenue for the Exchange, which should, in 
turn, help to offset the cost of increased regulatory efforts by the 
Exchange. The Exchange represents that this fee is comparable to one 
imposed by the Chicago Board Options Exchange, Inc. and the American 
Stock Exchange LLC.\8\
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    \8\ See Securities Exchange Act Release Nos. 46266 (July 25, 
2002), 67 FR 49969 (August 1, 2002) (SR-CBOE-2002-37) and 44286 (May 
9, 2001), 66 FR 27187 (May 16, 2001) (SR-Amex-2001-22). Both 
exchanges charge a $30 registered representative termination fee.
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2. Statutory Basis
    The Exchange believes that the proposed rule change, as amended, is 
consistent with Section 6(b) of the Act \9\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act \10\ in particular, 
because it is designed to provide for the equitable allocation of 
reasonable dues, fees, and other charges among its members.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 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, as 
amended, will impose any inappropriate 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 on the proposed rule change, as amended, were 
either solicited or received.

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

    The proposed rule change, as amended, has become effective pursuant 
to section 19(b)(3)(A)(ii) of the Act \11\ and subparagraph (f)(2) of 
Rule 19b-4 thereunder \12\ because it establishes or

[[Page 53774]]

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, as 
amended, 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.\13\
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    \11\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \12\ 17 CFR 240.19b-4(f)(2).
    \13\ For purposes of calculating the 60-day abrogation period, 
the Commission considers the period to commence on August 28, 2003, 
the date at which the Exchange 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 Room. Copies of the filing 
will also be available for inspection and copying at the principal 
office of the Phlx. All submissions should refer to File No. SR-Phlx-
2003-55 and should be submitted by October 3, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-23227 Filed 9-11-03; 8:45 am]
BILLING CODE 8010-01-P