[Federal Register Volume 60, Number 202 (Thursday, October 19, 1995)]
[Notices]
[Pages 54093-54094]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-25928]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36364; File No. SR-OPRA-95-1]
Options Price Reporting Authority; Notice of Filing and Immediate
Effectiveness of Amendment to OPRA Fee Schedule Revising the
Information Fees Payable by Professional Subscribers to Last Sale and
Quotation Information
October 12, 1995.
Pursuant to Rule 11Aa3-2 under the Securities Exchange Act of 1934
(``Exchange Act''), notice is hereby given that on September 15, 1995,
the Options Price Reporting Authority (``OPRAS'') \1\ submitted to the
Securities and Exchange Commission (``SEC'' or ``Commission'') an
amendment to the Plan for Reporting of Consolidated Options Last Sale
Reports and Quotation Information (``Plan''). The amendment revises the
information fees payable by professional subscribers to last sale and
quotation information. OPRA has designated this proposal as
establishing or changing a fee or other charge collected on behalf of
all of the OPRA participants in connection with access to or use of
OPRA facilities, permitting the proposal to become effective upon
filing pursuant to Rule 11Aa3-2(c)(3)(i) under the Exchange Act. The
Commission is publishing this notice to solicit comments from
interested persons on the amendment.
\1\ OPRA is a National Market System Plan approved by the
Commission pursuant to Section 11A of the Exchange Act and Rule
11Aa3-2 thereunder. Securities Exchange Act Release No. 17638 (Mar.
18, 1981).
The Plan provides for the collection and dissemination of last
sale and quotation information on options that are traded on the
five member exchanges. The five exchanges which agreed to the OPRA
Plan are the American Stock Exchange (``AMEX''); the Chicago Board
Options Exchange (``CBOE''); the New York Stock Exchange (``NYSE'');
the Pacific Stock Exchange (``PSE''); and the Philadelphia Stock
Exchange (``PHLX'').
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I. Description and Purpose of the Amendment
The purpose of the amendment is to revise the fees payable to OPRA
by professional subscribers for access to securities options market
data and related information (``OPRA data''), so that a greater share
of the costs of collecting, consolidating, processing and transmitting
OPRA data will be covered by these fees.\2\ Professional subscribers
are those persons that subscribe to OPRA data and do not qualify for
the reduced fees charged to nonprofessional subscribers. OPRA's
professional subscriber fees were last revised in 1991, over a four
year period beginning in January 1992 and ending in January 1995.
\2\ Concurrently with this filing, OPRA has filed an amendment
to the OPRA Plan proposing a new fee payable by subscribers to
OPRA's foreign currency option (``FCO'') service, effective January
1, 1996. The separate proposal has been made pursuant to the OPRA
Plan as amended effective March 14, 1995, that authorizes OPRA to
impose separate fees for access to or for the use of information
pertaining solely to FCOs. Upon the effectiveness of the foreign
currency option subscriber fee, therefore, OPRA's basic professional
and nonprofessional subscriber fees will cover access to all OPRA
data except for data pertaining to FCOs.
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The current schedule of professional subscriber fees offers volume
discounts to larger subscribers by reducing the fee per device as the
total number of devices maintained by a subscriber increases. There are
six separate pricing tiers covering the range from one device to 750 or
more devices per subscriber. In addition, the schedule provides for
discounts to subscribers that are members of one or more of OPRA's
participating exchanges.
OPRA is proposing the fee changes because, over the four years that
have elapsed since the last professional subscriber fee change was
authorized in 1991, the costs of collecting, processing, consolidating
and disseminating options last sale and bid/ask information have
increased. In large part, the increase is due to the implementation of
systems and equipment upgrades and additions that have enhanced the
capacity, reliability, and security of the OPRA system. Further, OPRA
anticipates that these costs will continue to escalate. OPRA believes
that the costs associated with the processing of OPRA data are largely
independent of trading volume and, therefore, it has determined that a
larger share of such costs should be covered by revenues that also are
largely independent of volume. The proposed amendment is intended to
achieve this objective, and to allocate market information fees fairly
among the different categories of professional subscribers that pay
such fees.
OPRA proposes to implement the amendment in four stages. The
implementation will take place on January 1 in each of the years 1996,
1997, 1998, and 1999. Over this period, changes will be made both to
the structure and level of the fees charged to professional
subscribers. Structurally, the proposed amendment retains the concept
of a volume discount. Over the course of the four year phase-in,
however, the number of tiers will be reduced from six to two. In
addition, a member firm discount will be maintained during the first
three years of the phase-in, but will be eliminated in the four year.
These structural changes are being proposed in order to simplify the
administration of the professional subscriber fee for OPRA, its vendors
and subscribers.
Changes in the level of OPRA's professional subscriber fees will
reduce the fees paid by smaller and medium-size subscribers and
increase the fees paid by larger subscribers. By the end of the phase-
in period, the fee paid by subscribers having less than 100 devices
will be established at a flat monthly rate of $19 per device. This will
result in a fee reduction for subscribers that have less than ten
devices and currently pay monthly device charges ranging from $22 to
$55 ($23 to $55 for nonmembers), and an increase for subscribers that
have from 10 to 99 devices and currently pay monthly device charges
ranging from $10 to $13 ($11 to $14 for nonmembers). By the end of the
same period, the fee paid by subscribers with 100 or more devices will
be established at a flat monthly rate of $11 per device. This flat rate
compares with current monthly charges from $8 to $10 ($9 to $11 for
nonmembers) paid by these larger subscribers. Assuming no change to the
size or distribution of OPRA's total professional base, OPRA estimates
that the net result of the fee changes in professional subscriber fees
over the entire implementation period is estimated to result in an
overall increase of 4.9%, 4.8%, 5.4%, and 5.3% at the end of each year
respectively.
II. Solicitation of Comments
Pursuant to Rule 11Aa3-2(c)(3), the amendment is effective upon
filing with the Commission. The Commission may summarily abrogate the
amendment within 60 days of its fling and require refiling and approval
of the amendment by Commission order pursuant to Rule 11Aa3-2(c)(2), if
it appears to the Commission that such action is necessary or
appropriate in the public interest; for the protection of investors and
the maintenance of fair and orderly markets; to remove impediments to,
and perfect the mechanisms of, a National Market System; or otherwise
in furtherance of the purposes of the Exchange Act.
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing.
[[Page 54094]]
Persons making written submissions should file six copies thereof with
the Secretary, Securities and Exchange Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies of the submission, all subsequent
amendments, and 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 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 at the principal offices of
OPRA. All submissions should refer to file number SR-OPRA-95-1 and
should be submitted by November 9, 1995.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\3\
\3\ 17 CFR 200.30-3(a)(29).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-25928 Filed 10-18-95; 8:45 am]
BILLING CODE 8010-01-M
