[Federal Register Volume 68, Number 204 (Wednesday, October 22, 2003)]
[Notices]
[Page 60426]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-26587]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48631; File No. SR-NASD-2003-127]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by the National Association of Securities Dealers, Inc. To 
Modify the Fees for the Listing of Additional Shares Program and To 
Institute a Record-Keeping Fee for Certain Changes by Issuers

October 15, 2003.

I. Introduction

    On August 11, 2003, the National Association of Securities Dealers, 
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc. 
(``Nasdaq'') submitted to the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to modify the fees for the listing of additional 
shares (``LAS'') program and to institute a record-keeping fee for 
certain changes by issuers. The proposed rule change was published for 
comment in the Federal Register on September 9, 2003.\3\ The Commission 
received no comments on the proposal. This order approves the proposed 
rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 48413 (August 26, 
2003), 68 FR 53209.
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II. Description of the Proposal

    The purpose of the proposed rule change is to modify the fees for 
the LAS program and to institute a record-keeping fee for certain 
changes by issuers in order to respond to the needs of Nasdaq. The LAS 
program involves notification and fee requirements for the issuance of 
additional shares. Specifically, an issuer must notify Nasdaq prior to 
a transaction that may implicate the corporate governance requirements 
and thereafter pay a fee that is based on the change in the issuer's 
total shares outstanding as reported in its periodic reports filed with 
the Commission. Nasdaq proposes to modify the LAS program fees in two 
ways. First, the minimum fee would be increased from $2,000 to $2,500 
for issuances of between 50,000 and 250,000 additional shares.\4\ 
Second, the current quarterly cap of $22,500 would be eliminated. The 
annual cap of $45,000, however, would be retained.
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    \4\ As under the current rules, there would be no fee for 
issuances of up to 49,999 per quarter.
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    In addition, Nasdaq also proposes to institute a $2,500 record-
keeping fee for certain changes made by issuers. Such a fee would be 
used to address the costs associated with revising Nasdaq's records 
when issuers engage in certain actions, including a change of name, a 
change in the par value or title of securities, or a voluntary change 
in trading symbol.

III. Discussion and Commission's Findings

    The Commission has carefully reviewed the proposed rule change and 
finds that the proposed rule change is consistent with the Act and the 
rules and regulations promulgated thereunder applicable to a national 
securities association,\5\ and, in particular, with the requirements of 
Section 15A \6\ of the Act. Specifically, the Commission finds that 
approval of the proposed rule change is consistent with Section 
15A(b)(5)\7\ of the Act because it is designed to provide for the 
equitable allocation of reasonable dues, fees, and other charges among 
members and issuers and other persons using any facility or system, 
which the NASD operates or controls. The Commission finds that the 
proposed rule change is reasonably designed to accomplish these ends by 
modifying the fees for the listing of additional shares program and to 
institute a record-keeping fee for certain changes by issuers on an 
equal basis. Moreover, the Commission believes that the additional fees 
should assist the NASD in carrying out its self-regulatory 
responsibilities.\8\
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    \5\ 15 U.S.C. 78f(b). In approving this proposal, the Commission 
has considered the proposed rule's impact on efficiency, competition 
and capital formation. 15 U.S.C. 78c(f).
    \6\ 15 U.S.C. 78o-3.
    \7\ 15 U.S.C. 78o-3(b)(5).
    \8\ Nasdaq has represented to the Commission that the LAS 
program fees are used to fund issuer-related operations, including 
educational initiatives, issuer service initiatives, and 
surveillance measures. See Securities Exchange Act Release No. 31586 
(December 11, 1992), 57 FR 60257 (December 18, 1992).
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IV. Conclusion

    It Is Therefore Ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (File No. SR-NASD-2003-127) be, 
and it hereby is approved.
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    \9\ 15 U.S.C. 78s(b)(2).

    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. 03-26587 Filed 10-21-03; 8:45 am]
BILLING CODE 8010-01-P