[Federal Register Volume 70, Number 31 (Wednesday, February 16, 2005)]
[Notices]
[Pages 7994-7995]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-643]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51182; File No. SR-SCCP-2004-04]


Self-Regulatory Organizations; Stock Clearing Corporation of 
Philadelphia; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change Relating to Adoption of a New Per Side Transaction 
Charge for Remote Specialist Units

February 10, 2005.
    Pursuant to Section 19(b)(1) of 1934 (``Act''),\1\ notice is hereby 
given that on December 29, 2004, the Stock Clearing Corporation of 
Philadelphia (``SCCP'') 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 primarily 
by SCCP. 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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    SCCP will amend its schedule of fees by adding a new transaction 
fee applicable to remote specialists that deliver certain types of 
orders to the Philadelphia Stock Exchange (``Phlx'') over PACE.\2\
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    \2\ PACE is Phlx's automated order routing, delivery, execution, 
and reporting system for equities. Phlx Rule 229.
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, SCCP 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. SCCP has prepared summaries, set forth in sections A, B, 
and C below, of the most significant aspects of such statements.\3\
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    \3\ The Commission has modified the text of the summaries 
prepared by SCCP.
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A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    Under the proposed rule change, SCCP will add a $0.15 per Program 
Trading Side transaction fee. Program Trading Sides are defined as 
market orders that are sent by an order flow provider to a remote 
specialist through PACE pursuant to the order flow provider's 
computerized trading methodology that is based on a predetermined 
algorithm.\4\ In order for the Program Trading Sides to qualify for the 
$0.15 fee, the order flow provider sending the Program Trading Sides 
must be affiliated with the remote specialist to whom the Program 
Trading Sides are directed.
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    \4\ Phlx Rules 229 and 229A govern the handling of orders 
received through PACE.
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    The purpose of this new fee is to provide an incentive for remote 
specialists to generate additional volume by attracting additional 
Program Trading Sides. Pursuant to the rule change, remote specialists 
will be charged a fee of $0.15 per trade side for Program Trading Sides 
(both odd-lots and round-lots) instead of the current fee of $0.30 per 
round-lot trade side and $0.10 per odd-lot trade side. For a given 
month, the fee for each remote specialist will be capped at $10 per day 
per

[[Page 7995]]

security provided the total number of Program Trading Sides settled by 
the remote specialist in all specialty securities exceeds 50,000 sides 
for that calendar month. SCCP proposed that the fee become effective 
beginning with trades settling on January 3, 2005.
    SCCP believes that the proposed rule change is consistent with 
Section 17A(b)(3)(D) of the Act \5\ which requires that the rules of a 
registered clearing agency provide for the equitable allocation of 
reasonable dues, fees, and other charges among its participants.
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    \5\ 15 U.S.C. 78q-1(b)(3)(D).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    SCCP 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

    SCCP did not solicit or receive written comments on the proposed 
rule change.

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

    The foregoing rule change took effect upon filing with the 
Commission pursuant to Section 19(b)(3)(A)(ii) of the Act \6\ and Rule 
19b-4(f)(2) \7\ thereunder because the proposed rule change changes a 
due, fee, or other charge imposed by SCCP. At any time within sixty 
days of the filing of such 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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    \6\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \7\ 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 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-SCCP-2004-04 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-SCCP-2004-04. 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 SCCP's 
principal office and on SCCP's Web site at http://www.phlx.com/SCCP/memindex_sccpproposals.html. 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-SCCP-2004-04 and should be submitted on or before March 
9, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
 [FR Doc. E5-643 Filed 2-15-05; 8:45 am]
BILLING CODE 8010-01-P