[Federal Register Volume 64, Number 7 (Tuesday, January 12, 1999)]
[Notices]
[Pages 1836-1838]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-597]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-40881; File No. SR-Amex-98-46]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the American Stock Exchange
LLC Relating to Revised Equity Fee Schedule
Janaury 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 11, 1998, the American Stock Exchange LLC (``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 Amex. 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 240.196-4.
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
Amex is proposing to revise its equity fee schedule to reflect the
transaction charges that will be imposed on trades in Select Sector
SPDRs and the Nasdaq 100 Index Trust, the new exchange-traded fund
products that are scheduled to begin trading in December and January,
respectively.\3\ The text of the proposed rule change is set forth
below. Proposed new language is italicized.
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\3\ In December 1998, the Commission approved trading of Select
Sector SPDRs, see Securities Exchange Act Release No. 40749
(December 4, 1998), 63 FR 68483 (December 11, 1998), and noticed the
Exchange's intention to trade the Nasdaq 100 Index Trust, see
Securities Exchange Act Release No. 40809 (December 18, 1998), 63 FR
71524 (December 28, 1998).
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[[Page 1837]]
Amex Equity Fee Schedule
I.
Transaction charges
Share--Based Charge
------------------------------------------------------------------------
Rate, per
Total shares/month share
------------------------------------------------------------------------
Up to 16,500,000........................................ $.00225
16,500,00-25,000,000.................................... .00200
25,000,001-33,000,000................................... .00175
Over 33,000,000......................................... .00150
------------------------------------------------------------------------
Value--Based Charge
------------------------------------------------------------------------
Rate per
Total gross dollar value/month $1,000
------------------------------------------------------------------------
Up to $200,000,000...................................... $0.7500
$200,000,001-300,000,000................................ .07000
$300,000,001-400,000,000................................ .06500
Over $400,000,000....................................... .05000
------------------------------------------------------------------------
Notes:
1. In calculating these charges, each order will be assessed on
the first 25,000 shares only.
2. Amex specialist/REMM trades are 100% deductible.
3. Amex option specialist/ROT trades in paired securities are
100% deductible.
4. The value-based portion of the transaction charge (based on
the value of shares traded) is subject to a maximum charge of $40
per trade.
5. Proprietary trades in Canadian securities are charged at 50%
of the above rates.
6. PER System orders for up to 1,099 shares will not be assessed
a share or value charge. This provision does not apply to PER orders
of a member of member organization trading as an agent for the
account of a non-member competing market maker. A ``competing market
maker'' is defined as a specialist or market maker registered as
such on a registered stock exchange (other than the Amex), or a
market maker bidding and offering over-the-counter, in an Amex-
traded security.
7. In lieu of the above transaction charge, a separate fee will
be imposed for executing trades in Standard & Poor's Depositary
Receipts (``SPDRs''), Select Sector Standard & Poor's Depositary
Receipts (``Select Sector SPDRs''), Standard and Poor's MidCap
Depositary Receipts (``MidCap SPDRs''), DIAMONDS, and the Nasdaq 100
Index Trust, which will vary depending on for whom the trade is
executed. Specialists will be charged a transaction fee of $.006 per
share (.60 per 100 shares), capped at $300 per trade (50,000
shares). Registered Traders will be charged a transaction fee of
$.007 per share ($.70 per 100 shares), capped at $350 per trade
(50,000 shares). Off-floor orders (i.e., customer and broker-dealer)
will be charged a transaction fee of $.006 per share ($.60 per 100
shares), capped at $100 per trade (16.667 shares).
8. PER System orders for up to 5,099 shares in SPDRs, Select
Sector SPDRs, MidCap SPDRs, DIAMONDS, and the Nasdaq 100 Index Trust
will not be assessed a transaction charge. This provision does not
apply to PER orders of a member of member organization trading as an
agent for the account of a non-member competing market maker.
II.
Regulatory Fee
.00005 x Total Value
Notes:
1. All trades executed on the Exchange in SPDRs, Select Sector
SPDRs, MidCap SPDRs, DIAMONDS, and the Nasdaq 100 Index Trust will
be exempt from the regulatory fee. This provision does not apply to
PER orders of a member or member organization trading as agent for
the account of a non-member competing market maker.
III. DIAMONDS Specialist Fee
In addition to the $.006 per share transaction charge imposed on
the specialist in DIAMONDS under Note 7 above, such specialist will
be required to pay a separate fee of $90,000 per months, payable at
the beginning of each month.
II. Self-Regulatory Organization's Statement of the Purpose of ,
and Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, Amex included statements
concerning the purpose of, and basis for, the fee 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.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
In 1997, the Amex approved certain changes in its equity fee
schedule relative to trades in SPDRs, MidCap SPDRs, and DIAMONDS
executed on the Amex. Under the fee schedule, specialists are charged a
transaction fee of $.006 per share ($.60 per 100 shares), capped at
$300 per trade (50,000 shares). Registered Traders are charged a
transaction fee of $.007 per share ($.70 per 100 shares), capped at
$350 per trade (50,000 shares). Off-floor orders (both customer and
broker-dealer) are charged a transaction fee of $.006 per share ($.60
per 100 shares), capped at $100 per trade (16,667 shares).
In addition to the foregoing, orders up to 5,099 shares in SPDRs,
MidCap SPDRs, and DIAMONDS routed to the Amex floor electronically
through the Amex's Post Execution Reporting (PER) System are not
assessed a transaction fee. However, the fee schedule operates on a
principle consistent with that applied in the context of the Amex's
current fee waiver in equities generally for PER orders up to 1,099
shares, in that the various fee waivers in SPDRs, MidCap SPDRs, and
DIAMONDS are not available to PER orders for the account of a nonmember
competing market maker.
In connection with the introduction of Select Sector SPDRs and the
Nasdaq 100 Index Trust, the new exchange-traded fund products scheduled
to begin trading in December and January, we are imposing on such
products the same transaction fee schedule that we impose
[[Page 1838]]
on trading in SPDRs, MidCap SPDRs, and DIAMONDS. These fees are
calculated to provide low costs to users of the products while making
the cost of trading on the Exchange comparable to the economics of
trading these and functionally similar products in other markets. The
Exchange will notify member firms regarding the fee change, as well as
the date of its effectiveness.
2. Statutory Basis
The fee change is consistent with section 6(b) of the Act in
general and furthers the objectives of section 6(b)(4) in particular in
that it is intended to assure 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
Amex 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
Amex 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 \4\ and
subparagraph (e)(2) of Rule 19b-4 thereunder.\5\
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\4\ 15 U.S.C. 78s(b)(3)(A).
\5\ 17 CFR 240.19b-4(e)(2).
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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.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the foregoing 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 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 Amex. All
submissions should refer to File No. SR-Amex-98-46 and should be
submitted by February 2, 1999.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\6\
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\6\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-597 Filed 1-11-99; 8:45 am]
BILLING CODE 8010-01-M
