[Federal Register Volume 69, Number 30 (Friday, February 13, 2004)]
[Notices]
[Pages 7277-7278]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-3194]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49207; File No. SR-PCX-2004-04]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc. To 
Amend Its Schedule of Fees and Charges to Temporarily Waive Market 
Maker Fees for Market Makers That Use More Than One Seat

February 6, 2004.
    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 January 28, 2004, the Pacific Exchange, Inc. (``PCX'' or 
``Exchange'') filed with 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 PCX 
has designated this proposal as one establishing or changing a due, 
fee, or other charge imposed by the PCX 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 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 Exchange proposes to amend the Market Maker Fees portion of its 
Schedule of Fees and Charges (``Schedule'') to adopt a temporary waiver 
of the Market Maker fees for those Market Makers that use more than one 
seat. The text of the proposed rule change is available at the PCX 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 PCX 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 PCX 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 Exchange proposes to amend the Market Maker Fees portion of the 
Schedule to adopt a temporary waiver of the Market Maker fees for those 
Market Makers that use more than one seat.
    Under the current Schedule, all Market Makers are assessed a fee of 
$1,750 per month for each seat that such Market Maker holds a primary 
appointment. In connection, PCX Rule 6.35(g)(2) permits Market Makers 
to increase the number of issues within their primary appointments 
depending on the number of seats that the Market Maker holds.\4\ Hence, 
a Market Maker benefits with additional issues as a result of holding 
multiple seats.
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    \4\ See PCX Rule 6.35(g)(2).
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    The Exchange proposes to temporarily waive the $1,750 Market Maker 
fee for all Market Makers for each additional seat (for which the 
Market Maker holds a primary appointment) beyond the first seat held by 
such Market Maker. In other words, a Market Maker will only be assessed 
one Market Maker fee of $1,750 per month whether the market Maker 
utilizes one seat or multiple seats. The PCX believes that a temporary 
waiver of the Market Maker fee in this limited circumstance is 
appropriate to encourage participation by a larger number of Market 
Makers on PCX Plus. As PCX Plus continues to expand, this temporary 
waiver will provide Market Makers with an incentive to take on a larger 
number of issues without incurring additional Market Maker fees. 
Therefore, the added participation should result in increased 
liquidity, which, in turn, will further competition. This waiver will 
remain in effect until April 30, 2004, or such earlier date as 
determined by the Exchange.\5\
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    \5\ The Commission notes that the PCX is required to file a 
proposed rule change if it decides to terminate the fee waiver 
before April 30, 2004.
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2. Statutory Basis
    The Exchange believes the proposal is consistent with section 6(b) 
of the Act,\6\ in general, and section 6(b)(4) of the Act,\7\ in 
particular, in that it provides for the equitable allocation of 
reasonable dues, fees and other charges among its members.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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

[[Page 7278]]

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

    Written comments on the proposed rule change were neither solicited 
nor received.

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 \8\ and subparagraph (f)(2) of Rule 19b-4 
thereunder,\9\ because it establishes or changes 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.
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    \8\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \9\ 17 CFR 240.19b-4(f)(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 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. Comments 
may also be submitted electronically at the following e-mail address: 
[email protected]. All comment letters should refer to File No. SR-
PCX-2004-04. This file number should be included on the subject line if 
e-mail is used. To help the Commission process and review comments more 
efficiently, comments should be sent in hardcopy or by e-mail but not 
by both methods. 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 PCX. All submissions should refer to file 
number SR-PCX-2004-04 and should be submitted by March 5, 2004.

    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. 04-3194 Filed 2-12-04; 8:45 am]
BILLING CODE 8010-01-P