[Federal Register Volume 69, Number 174 (Thursday, September 9, 2004)]
[Notices]
[Pages 54711-54712]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E4-2132]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50308; File No. SR-Amex-2004-59]


Self-Regulatory Organizations; American Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to a Reduction in Options Transaction Fees

September 2, 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 July 30, 2004, the American Stock Exchange, Inc. (``Amex'' 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 Amex. The Amex 
submitted the proposed rule change under Section 19(b)(3)(A) of the Act 
\3\ and Rule 19b-4(f)(2) thereunder,\4\ 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).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to reduce aggregate options transaction fees 
for specialists and registered options traders from $0.30 per contract 
side to $0.25 per contract side. The text of the proposed rule change 
is available at the Amex 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 Amex 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. Amex has prepared summaries, set forth in Sections A, B, 
and C below, of the most significant aspects of such statements.

[[Page 54712]]

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

1. Purpose
    The Amex imposes transaction charges for transactions in equity 
options executed on the Exchange by Exchange specialists and Exchange 
registered options traders (``ROTs''). The current charges for Exchange 
specialists and ROTs in equity options are $0.30 per contract side, 
consisting of an options transaction fee of $0.20, an options 
comparison fee of $0.05 and an options floor brokerage fee of $0.05. 
The Exchange proposes to reduce the aggregate equity option transaction 
fee for Exchange specialists and ROTs from the current level of $0.30 
per contract side to $0.25 per contract side effective August 1, 2004. 
Non-member market makers, i.e., market makers registered in the same 
option class on another option exchange, will continue to be charged 
the current transaction fee of $0.30 per contract side. Under the 
proposed revisions to the Options Fee Schedule, transaction fees 
charged to non-member market makers for executing options transactions 
on the Exchange will be separately identified.\5\ The new aggregate 
equity option transaction fee for Exchange specialists and ROTs will 
consist of an options transaction fee of $0.15 per contract side, an 
options comparison fee of $0.05 per contract side, and options floor 
brokerage fee of $0.05 per contract side.
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    \5\ Currently, non-member market makers are subject to 
transaction fees applicable to Exchange specialists and ROTs as set 
forth in the Options Fee Schedule. Therefore, for clarity, the 
Exchange proposes to separately set forth transaction fees 
applicable to non-member market makers in the revised Options Fee 
Schedule.
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    In conjunction with the proposed reduction in the aggregate equity 
option transaction fee for Exchange specialists and ROTs, the fee 
reductions in the Options Fee Schedule for cabinet trades (``Cabinet 
Trades'') and reversals and conversions, dividend spreads, box spreads, 
and butterfly spreads (``Spread Trades'') are terminated for Exchange 
specialists, ROTs, and member broker-dealers.\6\ Effective August 1, 
2004, the fee reductions applicable to Exchange specialists, ROTs and 
member broker-dealers for QQQ options in connection with Cabinet Trades 
and Spread Trades do not apply.
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    \6\ See Securities Exchange Act Release No. 49763 (May 24, 
2004), 69 FR 30967 (June 1, 2004).
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    The Exchange believes that the reduction in equity options 
transaction fees will benefit the Exchange by providing greater 
incentive to Exchange specialists and ROTs to competitively quote their 
markets in comparison to the markets made by other options exchanges. 
In addition, the Exchange also believes that the reduction in equity 
option transaction fees will help maintain the existing floor 
operations of member firms at the Amex.
2. Statutory Basis
    The Exchange believes that its proposed rule change is consistent 
with Section 6(b) of the Act,\7\ in general, and furthers the 
objectives of Section 6(b)(4) of the Act,\8\ in particular, regarding 
the equitable allocation of reasonable dues, fees, and other charges 
among exchange members and other persons using exchange facilities.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 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 any burden on competition 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 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 \9\ and subparagraph (f)(2) of Rule 19b-4 
thereunder,\10\ because it establishes or changes a due, fee, or other 
charge imposed by Amex. 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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    \9\ 15 U.S.C. 78s(b)(3)(a)(ii).
    \10\ 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 proposed rule 
change, as amended, is consistent with the Act. Comments may be 
submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-Amex-2004-59 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-Amex-2004-59. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). 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 also will be available for inspection and copying at the 
principal offices of the Amex. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-Amex-2004-59 and should be submitted on or before 
September 30, 2004.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
 [FR Doc. E4-2132 Filed 9-8-04; 8:45 am]
BILLING CODE 8010-01-P