[Federal Register Volume 64, Number 7 (Tuesday, January 12, 1999)]
[Notices]
[Pages 1847-1849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-595]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-40880; File No. SR-CHX-98-30]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Changes by the Chicago Stock Exchange,
Inc. Relating to MAX Executions of S&P 500 Issues, Floor Telephone
Booth and Post Space Fees, and a Fee Waiver
January 4, 1999.
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 December 21, 1998, the Chicago Stock Exchange, Incorporated (``CHX''
or ``Exchange'') filed with the Securities and Exchange commission
(``Commission'' or ``SEC'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by the CHX.
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)(I).
\2\ 17 CFR 240.19b-4.
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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 its Membership Dues and Fees
Schedule to eliminate all transaction and order processing fees related
to transactions in the stocks comprising the Standard & Poor's 500
Stock Price Index (the ``S&P 500''), as determined and revised by
Standard & Poor's from time to time, executed through the Exchange's
Midwest Automated Execution System (the ``MAX'' System), effective
January 1, 1999. Further, the Exchange proposes to amend its Membership
Dues and Fees Schedule to change the floor telephone booth and post
space fees charged to members from flat-rate fees to usage-based fees,
effective July 1, 1999. In connection with the floor telephone booth
and post space fee changes, the Exchange proposes to waive for six
months, from January 1, 1999 to June 30, 1999, the existing floor
telephone booth and post space charges applicable to floor members. The
text of the proposed rule change is as follows (additions are
italicized; delections are [bracketed]):
Membership Dues and Fees
(c) Order Processing Fee Schedule:
Odd Lots........................... $.35 per trade.
$400.00 maximum monthly fee.
Open Limit Orders.................. $.25 per trade (assessed on
execution).
The above order processing fees shall not apply to transactions in
NASDAQ/NMS Securities, or to transactions in the stocks comprising the
Standard & Poor's 500 Stock Price Index executed through MAX.
(d) Transaction Fee Schedule:
(1) Market orders sent via MAX..... No charge.
(2) All others orders (except as
set forth below):
Rate per share
First 500 shares............... $.00
Next 2,000 shares.............. $.0075
Next 7,500 shares.............. $.005
Remaining shares............... $.004 (up to a maximum of
$100.00 per side)
(3) Monthly maximums for fees
incurred in (2) above:
(i) Maximum monthly transaction $7,000
fees for orders sent via MAX.
(ii) Maximum monthly $78,000
transaction fee for firms
without a floor broker or
market maker presence on the
floor.
(iii) Maximum monthly $54,000
transaction fee for firms with
a floor broker or market maker
presence on the floor.
(iv) Maximum monthly ...............................
transaction fees shall not
exceed the lesser of that
specified in (ii) or (iii)
above, or $.40 per 100 average
monthly gross round lot shares.
The above transaction fees shall not apply to transactions executed
through MAX in Tape B eligible issues or in the stocks comprising the
Standard & Poor's 500 Stock Price Index. [which are executed through
MAX.]
* * * *
* * *
(e) Equipment/Space Charges:
[[Page 1848]]
Floor Telephone Booth.............. [$42 per month per booth with
one telephone and $10 per
month for each additional
telephone in such a booth,
except that there will be a
minimum of $42 per month per
firm occupying the booth.]
Effective July 1, 1999, the
expense to the Exchange of
leasing the space occupied by
the telephone booths shall be
allocated pro rata based on
usage among all floor members
and member organizations on a
monthly basis. Each member or
member organization's portion
shall be determined based on
the percentage of actual
square footage of floor
telephone booth space occupied
by each member.
Post Space......................... [$100 each per month] Effective
July 1, 1999, the expense of
the Exchange of leasing the
post space shall be allocated
pro rata based on usage among
all floor members and member
organizations on a monthly
basis. Each member or member
organization's portion shall
be determined based on the
actual square footage of the
post occupied by each member.
Technical Equipment (per month).... Four Screen Rich Units: 250.00
Three Screen Rich Units: 208.35
Two Screen Rich Units: 166.65
Max Floor Broker Terminals:
37.95
Floor Broker Printer: 49.95
Specialist Back Post MAX
Terminals: 37.95
Specialist Printer: 49.95
Teletype Space..................... $25 per month for each machine
of every firm employing
private teletype facilities on
the Floor.
Quote Machines..................... Quotron equipment, $180 per
month. Equipment options
extra.
Floor Box Rental................... $1 per month, payable annually.
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 CHX 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. The CHX 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 is proposing three changes to its Membership Dues and
Fees Schedule in this filing. First, the Exchange is proposing to
eliminate all transaction and order processing fees for transactions in
the stocks comprising the Standard & Poor's 500 Stock Price Index, as
determined and revised by Standard & Poor's from time to time, executed
through the Exchange's MAX System, effective January 1, 1999. The
purpose of this change is to make the Exchange more competitive in
attracting order flow in these actively traded stocks.
Second, the Exchange is proposing to change the floor telephone
booth and post space fees from flat-rate fees to pro rata fees based on
the Exchange's cost of leasing the space as divided among members
according to the square footage of floor telephone booth and post space
occupied by each member, effective July 1, 1999. The purpose of this
change is to pass through to floor members the Exchange's actual cost
of leasing the space on the Floor so that member fees more accurately
reflect actual Exchange costs.
Finally, the Exchange is proposing to waive, for a period of six
months, the current floor telephone booth and post space charges
applicable to floor members. The waiver period will begin January 1,
1999, and end June 30, 1999, thus coinciding with the start of the new
floor telephone booth and post space fee structure.
The Exchange's Finance Committee has determined that after the
proposed changes in fee structure, the Exchange will have ample capital
and resources to continue to fulfill its proscribed duties in its
capacity as a self-regulatory organization and as a registered national
securities exchange.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b)(4) of the
Act in that it provides for the equitable allocation of reasonable
dues, fees and other charges among members, issuers, and other persons
using the Exchange's facilities.
B. Self-Regulatory Organization's Statement on Burden on Competition
The CHX does not believe that the proposed rule change will result
in 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
The Exchange has neither solicited nor received 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, which establishes or changes a due, fee,
or other charge applicable to members of the Exchange, has become
effective pursuant to section 19(b)(3)(A) of the Act \3\ and
subparagraph (e)(2) of Rule 19b-4 thereunder.\4\ At any time within 60
days of the filing of such 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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\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(e)(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. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.
Copies of the submission, all subsequent
[[Page 1849]]
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 at the Commission's Public
Reference Room. Copies of such filing also will be available for
inspection and copying at the principal office of the CHX. All
submissions should refer to File No. SR-CHX-98-30 and should be
submitted by February 2, 1999.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\5\
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\5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secertary.
[FR Doc. 99-595 Filed 1-11-99; 8:45 am]
BILLING CODE 8010-01-M
