Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto by the Pacific Exchange, Inc. Relating to Exchange Fees and Charges, 5261-5263 [E5-360]

Download as PDF Federal Register / Vol. 70, No. 20 / Tuesday, February 1, 2005 / Notices options on SPDRs similarly be subject to position limits and exercise limits of 300,000 contracts. The Exchange believes that increasing position limits and exercise limits for SPDR options would lead to a more liquid and competitive market environment for SPDR options that would benefit customers interested in this product. Consistent with the reporting requirement for QQQ options, the Exchange would require that each Options Participant 5 that maintains a position on the same side of the market in excess of 10,000 contracts in the SPDR option class, for its own account or for the account of a customer, report certain information.6 This data would include, but would not be limited to, the option position, whether such position is hedged and if so, a description of the hedge and if applicable, the collateral used to carry the position. In addition, the general reporting requirement for customer accounts that maintain a position in excess of 200 contracts would remain at this level for SPDR options.7 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the requirements of Section 6(b) of the Act 8 in general, and Section 6(b)(5) of the Act,9 in particular, in that it is designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts and, in general, to protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change would impose any burden on competition 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 comments on the proposed rule change. III. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, 5 Defined in Section 1(40) of Chapter I of the BOX Rules. 6 See Section 10(b) of Chapter III of the BOX Rules. 7 See Section 10(a) of Chapter III of the BOX Rules. 8 15 U.S.C. 78f(b). 9 15 U.S.C. 78f(b)(5). VerDate jul<14>2003 15:06 Jan 31, 2005 Jkt 205001 5261 the requirements of Section 6(b)(5) of the Act.11 Specifically, the Commission finds that the proposed rule change should ensure that the Exchange’s position limits and exercise limits on Electronic Comments SPDR options provide its members with • Use the Commission’s Internet sufficient flexibility to participate in the comment form (http://www.sec.gov/ market for such options in a manner rules/sro.shtml); or that should provide greater depth and • Send an e-mail to ruleliquidity for all market participants. comments@sec.gov. Please include File The Commission finds good cause for Number SR–BSE–2005–05 on the approving this proposed rule change subject line. prior to the thirtieth day after Paper Comments publication of notice thereof in the Federal Register. Specifically, the • Send paper comments in triplicate Commission believes that granting to Jonathan G. Katz, Secretary, accelerated approval to the proposed Securities and Exchange Commission, rule change should permit greater depth 450 Fifth Street, NW., Washington, DC and liquidity in the SPDR options 20549–0609. market that should benefit all market All submissions should refer to File Number SR–BSE–2005–05. This file participants, including retail investors. number should be included on the Because the higher position limits and subject line if e-mail is used. To help the exercise limits mirror those that the Commission process and review your Commission has previously approved comments more efficiently, please use for like products, the Commission only one method. The Commission will believes it is consistent with Sections post all comments on the Commission’s 6(b)(5) 12 and 19(b)(2) 13 of the Act to Internet Web site (http://www.sec.gov/ approve the BSE’s proposed rule change rules/sro.shtml). Copies of the on an accelerated basis. submission, all subsequent V. Conclusion amendments, all written statements with respect to the proposed rule It is therefore ordered, pursuant to change that are filed with the Section 19(b)(2) of the Act,14 that the Commission, and all written proposed rule change (SR–BSE–2005– communications relating to the 05) is hereby approved on an proposed rule change between the accelerated basis. Commission and any person, other than For the Commission, by the Division those that may be withheld from the of Market Regulation, pursuant to public in accordance with the delegated authority.15 provisions of 5 U.S.C. 552, will be available for inspection and copying in Margaret H. McFarland, the Commission’s Public Reference Deputy Secretary. Section. Copies of such filing also will [FR Doc. E5–361 Filed 1–31–05; 8:45 am] be available for inspection and copying BILLING CODE BILLING CODE 8010–01–U at the principal office of the BSE. All comments received will be posted without change; the Commission does SECURITIES AND EXCHANGE not edit personal identifying COMMISSION information from submissions. You should submit only information that you wish to make available publicly. All [Release No. 34–51076; File No. SR–PCX– 2004–125] submissions should refer to File Number SR–BSE–2005–05 and should Self-Regulatory Organizations; Notice be submitted on or before February 22, of Filing and Immediate Effectiveness 2005. of Proposed Rule Change and IV. Commission’s Findings and Order Amendment Nos. 1 and 2 Thereto by Granting Accelerated Approval of the Pacific Exchange, Inc. Relating to Proposed Rule Change Exchange Fees and Charges After careful review, the Commission January 25, 2005. finds that the proposed rule change is Pursuant to Section 19(b)(1) of the consistent with the requirements of the Securities Exchange Act of 1934 Act and the rules and regulations thereunder, applicable to a national 11 15 U.S.C. 78f(b)(5). securities exchange,10 and, in particular, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: 12 15 In approving this proposal, the Commission has considered its impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). PO 00000 10 10 Frm 00133 Fmt 4703 Sfmt 4703 U.S.C. 78f(b)(5). U.S.C. 78s(b)(2). 14 15 U.S.C. 78s(b)(2). 15 17 CFR 200.30–3(a)(12). 13 15 E:\FR\FM\01FEN1.SGM 01FEN1 5262 Federal Register / Vol. 70, No. 20 / Tuesday, February 1, 2005 / Notices (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on December 21, 2004, the Pacific Exchange, Inc. (‘‘PCX’’ 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 Exchange. On January 12, 2005, the Exchange filed Amendment No. 1 to the proposed rule change. On January 13, 2005, the Exchange filed Amendment No. 2 to the proposed rule change. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend its Schedule of Fees and Charges For Exchange Services (‘‘Schedule’’) in order to eliminate the Shortfall Fee and corresponding Shortfall Credit and the Designated Options Examining Authority (‘‘DOEA’’) fee, add a clarifying change to the $500 application fee for a request for a waiver pursuant to PCX Rule 2.5(c)(4) and make certain administrative changes. The text of the proposed rule change is available on the Exchange’s Web site (http://www.pacificex.com/legal/ legal_pending.html), at the Exchange’s Office of the Secretary, and at the Commission’s Public Reference Room. 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 Exchange 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 Exchange 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 to amend its Schedule in order to eliminate the Shortfall Fee, as well as the corresponding Shortfall Credit, and the DOEA fee, add a clarifying change to the 1 15 2 17 U.S.C. 78s(b)(1). CFR 240.19b–4. VerDate jul<14>2003 15:06 Jan 31, 2005 Jkt 205001 $500 application fee for a request for a waiver pursuant to PCX Rule 2.5(c)(4) and make certain administrative changes. The Shortfall Fee and Credit The ‘‘Shortfall Fee’’ is a fee that is charged on the volume difference between 12% of the total national market share in an option issue for one month and the percentage executed by the Lead Market Maker (‘‘LMM’’). The current Shortfall Fee is $0.35 per contract. An LMM is currently entitled to a ‘‘Shortfall Credit’’ of $0.35 per contract for any top 120 equity option issues the LMM trades where the PCX volume in the issue is higher than 12% of the scaled national volume in that issue for that month. The volume base for the Shortfall Credit is the PCX monthly volume for the issue less 12% of the scaled monthly industry volume for each qualifying issue. The Shortfall Credit may be used by an LMM only to offset a Shortfall Fee the LMM incurs for the same month and may not be used to offset other fees, or be carried forward or applied retroactively to the Shortfall Fee the LMM has incurred or will incur for other months. For the purpose of calculating the Shortfall Fee, the national market share of any equity option industry volume is capped at 2.9 million contracts per day. Shortfall Fee billing commences after an issue completes the first four full months of trading under an LMM. The Exchange is proposing to eliminate the Shortfall Fee and the corresponding Shortfall Credit in their entirety. The Exchange believes that the elimination of the Shortfall Fee is appropriate in order to make the PCX more competitive and to add liquidity to the marketplace. The Exchange intends to provide all LMMs with a rebate for fees paid in the months of October and November 2004. DOEA Fee Previously, the PCX contracted with the NASD to conduct all DOEA examinations for the Exchange. The Exchange would pass along the cost of the examination plus 17% to the entity that was examined. NASD has stopped providing this service to the Exchange, and the Exchange no longer monitors any firms that require DOEA examinations. Accordingly, the Exchange is proposing to eliminate the DOEA fee from the Schedule. $500 Application Fee for a Request for a Waiver Pursuant to PCX Rule 2.5(c)(4) The Exchange’s Shareholder and Registration Services Department has received numerous questions about the PO 00000 Frm 00134 Fmt 4703 Sfmt 4703 application of the $500 application fee for a request for a waiver pursuant to PCX Rule 2.5(c)(4). Option Trading Permit Holders (‘‘OTP Holders’’) and applicants have expressed a desire for further clarification as to the circumstances under which they would be subject to the fee. The purpose of the fee is to allow the Exchange to recover costs associated with independently verifying each justification given by an applicant as to why a waiver should be granted.3 The fee does not apply to circumstances where the Exchange only has to verify that an applicant has successfully completed an examination. Therefore, the Exchange is proposing to add clarifying language to the Schedule that states the fee does not apply when the request only involves validating that an applicant has successfully completed a qualifying examination. Administrative Changes The Exchange is proposing certain changes to the Schedule that will eliminate typographical errors, correct grammatical errors and amend calendar references. In addition, the Exchange is proposing certain clarifying language that is designed to make the Schedule easier to comprehend. Specifically, the Exchange is clarifying that for the Vendor Equipment Room Usage Fee, firms not using a full cabinet will not pay the full fee. Instead such firms will pay a pro rata portion thereof. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 4 in general, and furthers the objectives of Section 6(b)(4) of the Act 5 in particular, in that the proposal provides for the equitable allocation of reasonable dues, fees and other charges among the Exchange’s OTP Holders and other persons using the Exchange’s facilities for trading option contracts. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. 3 See Securities Exchange Act Release No. 50742 (November 29, 2004), 69 FR 70488 (December 6, 2004) (SR–PCX–2004–101). 4 15 U.S.C. 78f(b). 5 15 U.S.C. 78f(b)(4). E:\FR\FM\01FEN1.SGM 01FEN1 Federal Register / Vol. 70, No. 20 / Tuesday, February 1, 2005 / Notices 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 proposed rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act 6 and Rule 19b– 4(f)(2) thereunder,7 because the proposed rule change establishes or changes a due, fee or other charge applicable only to a member of the Exchange. At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate the rule change if it appears to the Commission that the action is necessary or appropriate in the public interest, for the protection of investors, or would otherwise further the purposes of the Act.8 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. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–PCX–2004–125 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549–0609. All submissions should refer to File Number SR–PCX–2004–125. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s 6 15 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 8 For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under Section 19(b)(3)(C) of the Act, the Commission considers that period to commence on January 13, 2005, the date the Exchange filed Amendment No. 2 to the proposed rule change. See 15 U.S.C. 78s(b)(3)(C). 7 17 VerDate jul<14>2003 15:06 Jan 31, 2005 Jkt 205001 Internet Web site (http://www.sec.gov/ rules/sro.shtml). 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. 552, will be available for inspection and copying in the Commission’s Public Reference Room. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-PCX–2004–125 and should be submitted on or before February 22, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.9 Margaret H. McFarland, Deputy Secretary. [FR Doc. E5–360 Filed 1–31–05; 8:45 am] BILLING CODE 8010–01–U SECURITIES AND EXCHANGE COMMISSION [Release No. 34–51080; File No. SR–Phlx– 2004–51] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Order Granting Approval to Proposed Rule Change and Amendment No. 1 Thereto Relating to Phlx Regulation 5, Visitors and Applicants January 26, 2005. On October 7, 2004, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to update Phlx Regulation 5, Visitors and Applicants, enacted as a rule of order and decorum under Phlx Rule 60. On December 6, 2004, Phlx filed Amendment No. 1 to the proposed rule PO 00000 9 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 15 Frm 00135 Fmt 4703 Sfmt 4703 5263 change.3 The proposed rule change, as amended, was published for comment in the Federal Register on December 22, 2004.4 The Commission received no comments on the proposal. Phlx is amending its Phlx Regulation 5 to more accurately reflect its current practices. The Exchange amended Phlx Regulation 5 in 1992 to create an ‘‘applicant’’ status for prospective Exchange members.5 A person who fell into the applicant category was issued an Applicant Access Card and Floor Badge that would allow for unescorted floor access until the application process was complete. Phlx no longer issues such Applicant Access Cards and Floor Badges to applicants, but instead requires applicants to register as onfloor trading personnel pursuant to Phlx Rule 620(b), Trading Floor Registration. Applicants are now issued the same access cards as are issued to Phlx members, and their access to the floor is governed by Phlx Rule 620(b), rather than Regulation 5. Phlx proposes to return Regulation 5 to its pre-1992 wording, which governs only guest access to the floor. Phlx members who do not adhere to the procedures set forth in Regulation 5 would be subject to sanction. The Commission finds that the proposed rule change, as amended, is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange.6 In particular, the Commission believes that the proposal is consistent with Section 6(b)(5) of the Act 7 because ensuring that unauthorized persons do not have improper access to the Exchange floor is consistent with the protection of investors and the public interest. It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 8 that the proposed rule change (File No. SR– Phlx–2004–51), as amended, be, and it hereby is, approved. 3 Amendment No. 1 replaced the original filing in its entirety. Amendment No. 1 clarified that violations of Regulation 5 would be enforced against members and not the guests themselves, and added a description for the Applicant Access Card. 4 See Securities Exchange Act Release No. 50851 (December 14, 2004), 69 FR 76816. 5 See Securities Exchange Act Release No. 30416 (February 26, 1992), 57 FR 7836 (March 4, 1992) (approving File No. SR–Phlx–91–06). 6 In approving this proposed rule change, the Commission notes that it has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 7 15 U.S.C. 78f(b)(5). 8 15 U.S.C. 78s(b)(2). E:\FR\FM\01FEN1.SGM 01FEN1

Agencies

[Federal Register Volume 70, Number 20 (Tuesday, February 1, 2005)]
[Notices]
[Pages 5261-5263]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-360]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51076; File No. SR-PCX-2004-125]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 
Thereto by the Pacific Exchange, Inc. Relating to Exchange Fees and 
Charges

January 25, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 5262]]

(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on December 21, 2004, the Pacific Exchange, Inc. (``PCX'' 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 Exchange. On 
January 12, 2005, the Exchange filed Amendment No. 1 to the proposed 
rule change. On January 13, 2005, the Exchange filed Amendment No. 2 to 
the proposed rule change. The Commission is publishing this notice to 
solicit comments on the proposed rule change, as amended, from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \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 Schedule of Fees and Charges For 
Exchange Services (``Schedule'') in order to eliminate the Shortfall 
Fee and corresponding Shortfall Credit and the Designated Options 
Examining Authority (``DOEA'') fee, add a clarifying change to the $500 
application fee for a request for a waiver pursuant to PCX Rule 
2.5(c)(4) and make certain administrative changes. The text of the 
proposed rule change is available on the Exchange's Web site (http://
www.pacificex.com/legal/legal_pending.html), at the Exchange's Office 
of the Secretary, and at the Commission's Public Reference Room.

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 Exchange 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 Exchange 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 to amend its Schedule in order to 
eliminate the Shortfall Fee, as well as the corresponding Shortfall 
Credit, and the DOEA fee, add a clarifying change to the $500 
application fee for a request for a waiver pursuant to PCX Rule 
2.5(c)(4) and make certain administrative changes.
The Shortfall Fee and Credit
    The ``Shortfall Fee'' is a fee that is charged on the volume 
difference between 12% of the total national market share in an option 
issue for one month and the percentage executed by the Lead Market 
Maker (``LMM''). The current Shortfall Fee is $0.35 per contract. An 
LMM is currently entitled to a ``Shortfall Credit'' of $0.35 per 
contract for any top 120 equity option issues the LMM trades where the 
PCX volume in the issue is higher than 12% of the scaled national 
volume in that issue for that month. The volume base for the Shortfall 
Credit is the PCX monthly volume for the issue less 12% of the scaled 
monthly industry volume for each qualifying issue. The Shortfall Credit 
may be used by an LMM only to offset a Shortfall Fee the LMM incurs for 
the same month and may not be used to offset other fees, or be carried 
forward or applied retroactively to the Shortfall Fee the LMM has 
incurred or will incur for other months. For the purpose of calculating 
the Shortfall Fee, the national market share of any equity option 
industry volume is capped at 2.9 million contracts per day. Shortfall 
Fee billing commences after an issue completes the first four full 
months of trading under an LMM.
    The Exchange is proposing to eliminate the Shortfall Fee and the 
corresponding Shortfall Credit in their entirety. The Exchange believes 
that the elimination of the Shortfall Fee is appropriate in order to 
make the PCX more competitive and to add liquidity to the marketplace. 
The Exchange intends to provide all LMMs with a rebate for fees paid in 
the months of October and November 2004.
DOEA Fee
    Previously, the PCX contracted with the NASD to conduct all DOEA 
examinations for the Exchange. The Exchange would pass along the cost 
of the examination plus 17% to the entity that was examined. NASD has 
stopped providing this service to the Exchange, and the Exchange no 
longer monitors any firms that require DOEA examinations. Accordingly, 
the Exchange is proposing to eliminate the DOEA fee from the Schedule.
$500 Application Fee for a Request for a Waiver Pursuant to PCX Rule 
2.5(c)(4)
    The Exchange's Shareholder and Registration Services Department has 
received numerous questions about the application of the $500 
application fee for a request for a waiver pursuant to PCX Rule 
2.5(c)(4). Option Trading Permit Holders (``OTP Holders'') and 
applicants have expressed a desire for further clarification as to the 
circumstances under which they would be subject to the fee. The purpose 
of the fee is to allow the Exchange to recover costs associated with 
independently verifying each justification given by an applicant as to 
why a waiver should be granted.\3\ The fee does not apply to 
circumstances where the Exchange only has to verify that an applicant 
has successfully completed an examination. Therefore, the Exchange is 
proposing to add clarifying language to the Schedule that states the 
fee does not apply when the request only involves validating that an 
applicant has successfully completed a qualifying examination.
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    \3\ See Securities Exchange Act Release No. 50742 (November 29, 
2004), 69 FR 70488 (December 6, 2004) (SR-PCX-2004-101).
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Administrative Changes
    The Exchange is proposing certain changes to the Schedule that will 
eliminate typographical errors, correct grammatical errors and amend 
calendar references. In addition, the Exchange is proposing certain 
clarifying language that is designed to make the Schedule easier to 
comprehend. Specifically, the Exchange is clarifying that for the 
Vendor Equipment Room Usage Fee, firms not using a full cabinet will 
not pay the full fee. Instead such firms will pay a pro rata portion 
thereof.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \4\ in general, and furthers the 
objectives of Section 6(b)(4) of the Act \5\ in particular, in that the 
proposal provides for the equitable allocation of reasonable dues, fees 
and other charges among the Exchange's OTP Holders and other persons 
using the Exchange's facilities for trading option contracts.
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    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

[[Page 5263]]

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 proposed rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act \6\ and Rule 19b-4(f)(2) thereunder,\7\ 
because the proposed rule change establishes or changes a due, fee or 
other charge applicable only to a member of the Exchange. At any time 
within 60 days of the filing of the proposed rule change, the 
Commission may summarily abrogate the rule change if it appears to the 
Commission that the action is necessary or appropriate in the public 
interest, for the protection of investors, or would otherwise further 
the purposes of the Act.\8\
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    \6\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \7\ 17 CFR 240.19b-4(f)(2).
    \8\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change under 
Section 19(b)(3)(C) of the Act, the Commission considers that period 
to commence on January 13, 2005, the date the Exchange filed 
Amendment No. 2 to the proposed rule change. See 15 U.S.C. 
78s(b)(3)(C).
---------------------------------------------------------------------------

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. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-PCX-2004-125 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-PCX-2004-125. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/
rules/sro.shtml). 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. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of the 
filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-PCX-2004-125 and should be submitted on or before 
February 22, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
 [FR Doc. E5-360 Filed 1-31-05; 8:45 am]
BILLING CODE 8010-01-U