[Federal Register Volume 62, Number 145 (Tuesday, July 29, 1997)]
[Notices]
[Pages 40561-40562]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19837]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38859; File No. SR-Amex-97-22]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the American Stock Exchange,
Inc. Relating to Revised Options Fee Schedule
July 22, 1997.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on June 18, 1997, the
American Stock Exchange, Inc. (``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 the self-regulatory organization. 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
The American Stock Exchange has revised its schedule of charges
imposed on trades in options executed on the Exchange. The text of the
fee change is available at the Office of the Secretary, the Amex and at
the Commission.
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 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 places specified in Item IV below. The self-regulatory organization
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 currently imposes a transaction charge on options
trades executed on the Exchange, with the charge varying depending on
whether it is an equity or index option and then on whether it was
executed for a specialist or market maker, for a member firm's
proprietary account, or for a customer. The Exchange also imposes a
charge for clearance of options trades, as well as an options floor
brokerage charge which again varies like the above transaction charge
depending on whom the trade was executed for.
The Exchange has revised its schedule of options charges to impose
caps on the number of options contracts subject to Exchange option
charges. Options charges will be imposed on customer trades for the
first 2,000 contracts and on member firm proprietary, specialist, and
market maker trades for the first 3,000 contracts. The caps will apply
to all three options charges--transaction, options clearance, and
options floor brokerage and will apply to one day's trades of 100 or
more contracts per execution on one side of any series executed by one
specialist/trader/broker (for one member firm) and cleared by one
clearing firm. Trades of less than 100 contracts that are multiple
contra parties to trades of 100 or more contracts will also be added to
the total number of contracts subject to the cap. The same fee schedule
and cap provision will apply to standardized and FLEX options. The
special fee schedule on box transactions is also being repealed in the
expectation that the proposed caps will be more attractive to the users
of boxes than the special box schedule. The Exchange believes that the
changes are necessary in order to make the Exchange's option fee
schedule more competitive with costs of trading other financial
instruments and to increase the number of options orders that are
routed to the Exchange.
The Exchange's schedule of options charges, as revised above, has
been submitted as Exhibit A to the submitted filing. The revised
options fee schedule has been implemented starting with transactions
effected on and after June 2, 1997.\2\
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\2\ According to the Amex, the retroactive application of the
proposed fee schedule will allow the Exchange to apply a single fee
schedule to transactions effected in June, thereby allowing the
Exchange to avoid the administrative billing burden inherent in
applying one fee schedule to the first half of the month of June and
another fee schedule to the latter half of the month. Telephone
conversation between J. Bruce Ferguson, Associate General Counsel,
Legal & Regulatory Policy, and George A. Villasana, Division of
Market Regulation (``Division''), SEC, on July 16, 1997. See also
letter from J. Bruce Ferguson, Associate General Counsel, Legal &
Regulatory Policy, to George A. Villasana, Attorney, Division, SEC,
dated July 17, 1997. The Amex stated that members were notified of
the proposed fee change via Amex Information Circular 97-0535 and
that the proposal would not result in increased fees for any
members. Id.
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2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the Act
\3\ in general and furthers the objectives of Section 6(b)(4) \4\ in
particular in that it provides for the equitable allocation of
reasonable dues, fees, and other charges among the Exchange's members
and other persons using its facilities.
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\3\ 15 U.S.C. 78f(b).
\4\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
[[Page 40562]]
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 constitutes or changes a due, fee, or
other charge imposed by the Exchange and, therefore, has become
effective pursuant to Section 19(b)(3)(A) of the Act \5\ and
subparagraph (e) of rule 19b-4 thereunder.\6\
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\5\ 15 U.S.C. 78s(b)(3)(A).
\6\ 17 CFR 240.19b-4.
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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. 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 that 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 Section, 450 Fifth Street, NW.,
Washington, DC 20549. Copies of such filing also will be available for
inspection and copying at the principal office of the American Stock
Exchange. All submissions should refer to File No. SR-Amex-97-22 and
should be submitted by [insert date 21 days from date of publication].
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\7\
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\7\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 97-19837 Filed 7-28-97; 8:45 am]
BILLING CODE 8010-01-M
