[Federal Register Volume 69, Number 187 (Tuesday, September 28, 2004)]
[Notices]
[Pages 58006-58007]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E4-2396]



[[Page 58006]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50416; File No. SR-Phlx-2004-45]


Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Rule 703 To Adopt a Tiered Late Filing Fee Schedule for Financial 
Reports

September 21, 2004.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4\2\ thereunder, the Securities and Exchange 
Commission (``Commission'') is giving notice that on July 16, 2004, the 
Philadelphia Stock Exchange, Inc. (``Phlx'' or ``Exchange'') filed with 
the Commission a proposed rule change to adopt a tiered late filing fee 
schedule for financial reports. On September 3, 2004, the Phlx amended 
the proposal.\3\ The amendment replaced the original filing. The 
proposed rule change is described in Items I, II, and III, below. These 
Items have been prepared by the Phlx. The Exchange has designated this 
proposed rule change as one establishing or changing a due, fee, or 
other charge imposed by the Phlx under Section 19(b)(3)(A)(ii) of the 
Act, which renders the proposed rule change effective upon filing with 
the Commission. The Commission is publishing this notice to solicit 
comments on the rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See September 2, 2004 letter from Cynthia Hoekstra, Counsel, 
Phlx, to Rose Wells, Division of Market Regulation, Commission, and 
attachments.
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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 Exchange Rule 703, ``Financial 
Responsibility and Reporting,'' to adopt a tiered late filing fee 
schedule.
    Currently, Exchange Rule 703(e), ``Due Dates; Fees for Late 
Filing,'' states in part that ``[E]ach financial report required by 
Rule 703(c) shall be filed with the Exchange within seventeen business 
days after the conclusion of the reporting period.'' Should a member 
organization or foreign currency options participant organization fail 
to comply with these filing requirements, unless an extension has been 
granted, that member organization or foreign currency options 
participant organization must pay a fee of $100 for each week or any 
part thereof that the report has not been filed.
    The Exchange proposes to change the current fee of $100 for each 
week or any part thereof that the report has not been filed to a tiered 
method so that the fee for the first late filing in a twelve-month 
period is $100 per week or any part thereof;\4\ the fee for the second 
late filing during a twelve-month period is $300 per week or any part 
thereof; and the fee for the third late filing, and subsequent late 
filings, during a twelve-month period is $1,000 per week or any part 
thereof.\5\ The proposed changes to Exchange Rule 703(e) are set forth 
below. Proposed new language is in italic and proposed deletions are in 
brackets.
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    \4\ The twelve-month calculation period will begin on the date 
the report is due. For example, if a January report is due on 
February 24, but not filed until March 15, the twelve-month 
calculation period would begin on February 24. A filing submitted 
after its due date and within twelve months from February 24 would 
be considered a second late filing.
    \5\ The Exchange may present repeated or aggravated failure to 
file such reports on a timely basis, regardless of the number of 
days late, to the Exchange's Business Conduct Committee for 
disciplinary action under Exchange Rules.
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Rule 703. Financial Responsibility and Reporting

    (a)-(d) No change.
    (e) Due Dates; Fees for Late Filing.--Each financial report 
required by Rule 703(c) shall be filed with the Exchange within 
seventeen business days after the conclusion of the reporting period. 
Reports shall be deemed to have been filed on the date which they have 
been postmarked; if such reports have not been postmarked, they shall 
be deemed to have been filed when received by the Exchange. A request 
for an extension of time to file any such report must be received by 
the Exchange no later than the business day before the due date for the 
required report. Unless such an extension has been granted, a member 
organization or foreign currency options participant organization shall 
pay a late fee [of $100] as set forth below for each week or any part 
thereof that the report has not been filed.
    (i) $100 per week for the first late filing in a twelve-month 
period;
    (ii) $300 per week for the second late filing during a twelve-month 
period; and
    (iii) $1,000 per week for the third late filing, and subsequent 
late filings, during a twelve-month period.
    The twelve-month period is calculated based on report due dates. 
Delinquencies will be calculated based on a running twelve-month 
period.
    (f) No change.
* * * * *

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 Phlx included statements 
concerning the purpose of and basis for the proposed rule change and 
stated that no written comments were either solicited or received on 
the proposed rule change. The text of these statements may be inspected 
and copied in the Commission's Public Reference Room and at the 
principal office of the Phlx. The Phlx 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 purpose of the proposed rule change is to encourage increased 
compliance with the filing requirements of Exchange Rule 703(e). The 
Exchange believes that implementing higher fees for late filings is 
necessary to convey the importance of filing the periodic and annual 
reports, as set forth in Exchange Rule 703, in a timely manner.
2. Statutory Basis
    The Exchange believes that its proposal to amend its schedule of 
dues, fees and charges is consistent with Section 6(b) of the Act \6\ 
in general, and furthers the objectives of Section 6(b)(4) of the Act 
\7\ in particular, in that it is an equitable allocation of reasonable 
dues, fees, and other charges among Exchange 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 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 were either solicited or received.

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)(A)(ii) of the Act \8\ and Rule 19b-

[[Page 58007]]

4(f)(2) \9\ 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 the proposed rule change, the Commission may summarily 
abrogate the 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.\10\
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    \8\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \9\ 17 CFR 240.19b-4(f)(2).
    \10\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change, as 
amended, under Section 19(b)(3)(C) of the Act (15 U.S.C. 
78s(b)(3)(C)), the Commission considers the period to commence on 
September 3, 2004, the date the Phlx filed its amendment.
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the rule change, including whether the rule change 
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-PHLX-2004-45 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathon G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-Phlx-2004-45. 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, 
please use only one method. The Commission will post all electronic 
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 rule change that are filed 
with the Commission, and all written communications relating to the 
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 
Phlx. 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 No. SR-Phlx-
2004-45 and should be submitted on or before October 19, 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. E4-2396 Filed 9-27-04; 8:45 am]
BILLING CODE 8010-01-P