[Federal Register Volume 61, Number 143 (Wednesday, July 24, 1996)]
[Notices]
[Pages 38490-38491]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18719]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37443; File No. SR-CHX-96-17]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the Chicago Stock Exchange,
Incorporated Relating to Clearing Support Fees
July 16, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. Sec. 78s(b)(1), notice is hereby given that on
July 2, 1996, the Chicago Stock Exchange, Incorporated (``CHX'' 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 the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to add an odd-lot dealer CUSIP fee to Section
(o) of its Membership Dues and Fees Schedule. The text of the proposed
rule change is as follows [new text is italicized]:
Chicago Stock Exchange, Incorporated
Membership Dues and Fees
(o) Clearing Support Fees
(1) Account Fees
First Master Account Fee: $500 per month
Additional Master Account Fee: $300 per month
Sub-Account Fees: $100 per account per month
(2) CUSIP Fees
Specialist CUSIP Fee: $50 per CUSIP per month
Market Maker CUSIP Fee: $10 per CUSIP per month
Odd Lot Dealer CUSIP Fee:\1\ $2.50 per CUSIP per month
Floor Broker as Principal: $2 per CUSIP per month
\1\ The Odd Lot Dealer CUSIP Fee does not apply to any issue in
which the off-lot dealer is also the specialist for the issue.
(minimum clearing support fee is $600 per month)
Discounts
The above Specialist CUSIP Fee will be subject to the following
discounts:
If between 20 and 200 trades occur in a particular CUSIP in a given
month, the Specialist CUSIP Fee for the CUSIP shall be $40 for that
month.
If less then 20 trades occur in a particular CUSIP in a given
month, the Specialist CUSIP Fee for that CUSIP shall be $20 for that
month.
II. Self-Regulatory Organizations' Statement of the Purpose of, and
Statutory Basis for the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
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 place specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Section A, B, 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 add a
clearing support fee for odd-lot dealers. The new fee will not apply to
any issue in which the odd-lot dealer is also the specialist for the
issue. This new fee is similar to the clearing support fees imposed on
specialists, market makers and floor brokers acting as principal
pursuant to SR-CHZ-96-10.\1\ This fee relates to the additional
services the CHX is providing to odd-lot dealers as a result of the
Midwest Clearing Corporation's withdrawal from the clearance and
settlement business. The odd-lot dealer clearing support fee is
applicable to all odd-lot dealers that have entered into an agency
agreement with the CHX pursuant to Article XXI, Rule 13 of the
Exchange's Rules.
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\1\ Securities Exchange Act Release No. 37054 (April 1, 1996),
61 FR 15544 (publishing Notice of Filing and Immediate Effectiveness
of Proposed Rule Change Relating to Clearing Support and Other
Fees).
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The amount of this CUSIP fee is based on expected account activity
and the expenses that the CHX will incur in servicing accounts for odd-
lot dealers. For example, because the CHX expects odd-lot dealers to
have less activity per CUSIP than specialists or market markers due to
the unusually large number of issues that an odd-lot dealer typically
trades, thus resulting in a lesser amount of staff time expended per
CUSIP to produce reports and provide the service contemplated by the
agency agreement, the odd-lot dealer CUSIP fee is less than the
specialist and market maker CUSIP fee.
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 its members
and issuers and persons using its facilities.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change will impose no 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 solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change establishes or changes a due, fee, or
other charge imposed by the Exchange and, therefore, has become
effective pursuant to Section 19(b)(3)(A)(ii) of the Act and
subparagraph (e) of Rule 19b-4 \2\ thereunder. At any time within 60
days of the filing of such proposed rule
[[Page 38491]]
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 purpose of the Act.
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\2\ 17 CFR 240.19b-4.
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. 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 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. Sec. 552, will be available for inspection and copying at
the Commission's Public Reference Section, 450 Fifth Street, NW.,
Washington, DC 20549. Copies of such filing will also be available for
inspection and copying at the principal office of the Exchange. All
submissions should refer to File No. SR-CHX-96-17 and should be
submitted by August 14, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-18719 Filed 7-23-96; 8:45 am]
BILLING CODE 8010-01-M
