Self-Regulatory Organizations; International Securities Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Fee Changes, 15372-15373 [E5-1305]
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Federal Register / Vol. 70, No. 57 / Friday, March 25, 2005 / Notices
the Division of Enforcement of an initial
decision of an administrative law judge.
Armstrong was formerly controller of
National Medical Care, Inc. (‘‘NMC’’), a
subsidiary of W.R. Grace & Co. (‘‘Grace’’).
The law judge found that Armstrong
participated in a scheme to manipulate
Grace’s reported earnings to achieve
predetermined targets. The alleged scheme
involved improperly recording excess
earnings as reserves and later using the
excess reserves to bolster earnings, thereby
achieving the impression that Grace had
steady, consistent growth in income over a
period of several years.
The law judge found that Armstrong
willfully violated Section 10(b) of the
Securities Exchange Act of 1934 and
Exchange Act Rule 10b–5 and that he was a
cause of Grace’s violation of those provisions.
The law judge also concluded that, as a result
of the scheme to manipulate Grace’s
earnings, Grace’s periodic reports during the
relevant period included financial statements
that were not in accordance with Generally
Accepted Accounting Principles (‘‘GAAP’’)
and that were materially misleading in
violation of the periodic reporting
requirements contained in Exchange Act
Section 13(a) and Exchange Act Rules 12b–
20, 13a–1, and 13a–13. The law judge found
that Armstrong was a cause of these
violations. The law judge further found that
Armstrong violated the recordkeeping
requirements of Exchange Act Section
13(b)(5) and Exchange Act Rule 13b2–1, and
was a cause of Grace’s violation of these
provisions and of Exchange Act Section
13(b)(2). The law judge imposed a cease-anddesist order against Armstrong.
The law judge dismissed the charges
brought pursuant to Commission Rule of
Practice 102(e). The law judge held that
Armstrong had not been appearing or
practicing before the Commission, and
dismissed the Rule 102(e)(1)(iii) charges on
this basis.
Armstrong appeals the law judge’s
conclusion that he violated and caused
Grace’s violations of the federal securities
laws and the Commission’s rules. He also
maintains that there is no basis in the public
interest for the imposition of a cease-anddesist order. The Division appeals the law
judge’s dismissal of the Rule 102(e) charges.
The Division seeks to deny permanently to
Armstrong the privilege of appearing or
practicing before the Commission.
Among the issues likely to be
considered are:
(1) Whether respondent committed
the alleged violations; and
(2) If so, whether sanctions should be
imposed in the public interest.
The subject matter of the closed
meeting scheduled for Tuesday, March
29, 2005, will be:
Post-argument discussion.
The subject matter of the closed
meeting scheduled for Thursday, March
31, 2005, will be:
Formal orders of investigations;
Institution and settlement of
injunctive actions; and
VerDate jul<14>2003
16:11 Mar 24, 2005
Jkt 205001
Institution and settlement of
administrative proceedings of an
enforcement nature.
At times, changes in Commission
priorities require alterations in the
scheduling of meeting items.
For further information and to
ascertain what, if any, matters have been
added, deleted or postponed, please
contact:
The Office of the Secretary at (202)
942–7070.
Dated: March 22, 2005.
Jonathan G. Katz,
Secretary.
[FR Doc. 05–5986 Filed 3–22–05; 4:21 pm]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–51397; File No. SR–ISE–
2005–13]
Self-Regulatory Organizations;
International Securities Exchange, Inc.;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change Relating to Fee Changes
March 18, 2005.
Pursuant to section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on March 7,
2005, the International Securities
Exchange, Inc. (the ‘‘Exchange’’ or the
‘‘ISE’’) filed with the Securities and
Exchange Commission (‘‘Commission’’)
the proposed rule change as described
in Items I and II below, which Items
have been prepared by the ISE. The
Exchange has filed the proposal as a
‘‘non-controversial’’ rule change
pursuant to Section 19(b)(3)(A)(ii) of the
Act,3 and Rule 19b–4(f)(6) thereunder,4
which renders the proposal effective
upon filing with the Commission.5 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 ISE is proposing to amend its
Schedule of Fees to establish fees for
transactions in options on the Nasdaq100 Stock Index. The text of the
proposed rule change is available on the
ISE’s Web site [https://
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
4 17 CFR 240.19b–4(f)(6).
5 The Exchange asked the Commission to waive
the 30-day operative delay. See 17 CFR 240.19b–
4(f)(6)(iii) (Rule 19b–4(f)(6)(iii)).
PO 00000
1 15
2 17
Frm 00097
Fmt 4703
Sfmt 4703
www.iseoptions.com/legal/
proposed_rule_changes.asp], at the
ISE’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
ISE 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 ISE 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 of Fees to establish fees for
transactions in options on the Nasdaq100 Stock Index, both full value
(‘‘NDX’’) and 1/10 value (‘‘MNX’’).6
Specifically, the Exchange is proposing
to adopt an execution fee and a
comparison fee for all transactions in
options on NDX and MNX.7 The amount
of the execution fee and comparison fee
shall be the same for all order types on
the Exchange—that is, orders for Public
Customers, Market Makers, and Firm
Proprietary—and shall be equal to the
execution fee and comparison fee
currently charged by the Exchange for
Market Maker and Firm Proprietary
transactions in equity options.8 The
Exchange believes the proposed rule
change will further the Exchange’s goal
of introducing new products to the
marketplace that are competitively
priced.
The Exchange has entered into a
license agreement with The Nasdaq
Stock Market, Inc. in connection with
the listing and trading of index options
on the Nasdaq-100 Stock Index. As with
licensed equity options, the Exchange is
adopting a per contract fee for trading in
these options to defray the licensing
6 See Securities Exchange Act Release No. 51121
(Feb. 1, 2005), 70 FR 6476 (Feb. 7, 2005) (File No.
SR–ISE–2005–01) (order approving the trading of
options on full and reduced values of the Nasdaq100 Stock Index).
7 The Exchange represents that these fees will be
charged only to Exchange members.
8 The execution fee is currently between $.21 and
$.12 per contract side, depending on the Exchange
Average Daily Volume, and the comparison fee is
currently $.03 per contract side.
E:\FR\FM\25MRN1.SGM
25MRN1
Federal Register / Vol. 70, No. 57 / Friday, March 25, 2005 / Notices
costs.9 The Exchange believes that
charging the participants that trade
these instruments is the most equitable
means of recovering the costs of the
license. However, because of
competitive pressures in the industry,
the Exchange proposes to exclude
Public Customer Orders 10 from this
surcharge fee. Accordingly, this
surcharge fee will only be charged to
Exchange members with respect to nonPublic Customer Orders (e.g., Market
Maker and Firm Proprietary orders) and
shall apply to Linkage Orders 11 under a
pilot program that is set to expire on
July 31, 2005.
2. Basis
The Exchange believes that the
proposed rule change is consistent with
section 6(b)(4) of the Act,12 which
requires that an exchange have an
equitable allocation of reasonable dues,
fees and other charges among its
members and other persons using its
facilities.
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.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change: (1)
Does not significantly affect the
protection of investors or the public
interest; (2) does not impose any
significant burden on competition; and
(3) does not become operative for 30
days from the date on which it was
9 The Commission notes, however, that the
proposed surcharge fee of $0.15 per contract for
NDX and MDX is higher than the current surcharge
fee level of $0.10 per contract on other products
listed in the ISE’s Schedule of Fees.
10 Public Customer Order is defined in Exchange
Rule 100(a)(33) as an order for the account of a
Public Customer. Public Customer is defined in
Exchange Rule 100(a)(32) as a person that is not a
broker or dealer in securities.
11 See ISE Rule 1900(10) (defining Linkage
Orders). The surcharge fee will apply to the
following Linkage Orders: Principal Acting as Agent
(‘‘P/A’’) Orders and Principal Orders.
12 15 U.S.C. 78f(b)(4).
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16:11 Mar 24, 2005
Jkt 205001
filed, or such shorter time as the
Commission may designate if consistent
with the protection of investors and the
public interest, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) of the Act 13 and
Rule 19b–4(f)(6) thereunder.14
A proposed rule change filed under
Rule 19b–4(f)(6) does not become
operative prior to 30 days after the date
of filing. However, Rule 19b–
4(f)(6)(iii) 15 permits the Commission to
designate a shorter time if such action
is consistent with the protection of
investors and the public interest. The
Exchange has requested that the
Commission waive the 30-day operative
delay and accelerate the implementation
of the proposed rule change so that it
may take effect prior to the 30 days
specified in Rule 19b–4(f)(6)(iii). Since
the proposed rule change does not raise
any novel issues and the Exchange
customarily charges fees for options
traded on the Exchange, the
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest.16 In designating the
proposal immediately operative, the
Commission does not believe that the
proposed rule change raises any new
issues of regulatory concern.
Accordingly, the Commission has
waived the 30-day operative delay
requirement for this proposed rule
change, and has determined to designate
the proposed rule change operative as of
March 7, 2005, the date of filing of the
proposed rule change.
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
such proposed 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.17
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:
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
15 17 CFR 240.19b–4(f)(6)(iii).
16 For purposes only of accelerating the operative
date of this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
17 See Section 19(b)(3)(C) of the Act, 15 U.S.C.
78s(b)(3)(C).
PO 00000
13 15
14 17
Frm 00098
Fmt 4703
Sfmt 4703
15373
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–ISE–2005–13 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–ISE–2005–13. 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 (https://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 such filing also will be
available for inspection and copying at
the principal office of the ISE. 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–ISE–2005–13 and should be
submitted by April 15, 2005.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.18
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5–1305 Filed 3–24–05; 8:45 am]
BILLING CODE 8010–01–P
18 17
E:\FR\FM\25MRN1.SGM
CFR 200.30–3(a)(12).
25MRN1
]]>Agencies
[Federal Register Volume 70, Number 57 (Friday, March 25, 2005)]
[Notices]
[Pages 15372-15373]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-1305]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-51397; File No. SR-ISE-2005-13]
Self-Regulatory Organizations; International Securities Exchange,
Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change Relating to Fee Changes
March 18, 2005.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on March 7, 2005, the International Securities Exchange, Inc. (the
``Exchange'' or the ``ISE'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by the ISE. The
Exchange has filed the proposal as a ``non-controversial'' rule change
pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\ and Rule 19b-4(f)(6)
thereunder,\4\ which renders the proposal effective upon filing with
the Commission.\5\ The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(6).
\5\ The Exchange asked the Commission to waive the 30-day
operative delay. See 17 CFR 240.19b-4(f)(6)(iii) (Rule 19b-
4(f)(6)(iii)).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The ISE is proposing to amend its Schedule of Fees to establish
fees for transactions in options on the Nasdaq-100[supreg] Stock Index.
The text of the proposed rule change is available on the ISE's Web site
[https://www.iseoptions.com/legal/proposed_rule_changes.asp], at the
ISE'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 ISE 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 ISE 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 of Fees to
establish fees for transactions in options on the Nasdaq-100 Stock
Index, both full value (``NDX'') and 1/10 value (``MNX'').\6\
Specifically, the Exchange is proposing to adopt an execution fee and a
comparison fee for all transactions in options on NDX and MNX.\7\ The
amount of the execution fee and comparison fee shall be the same for
all order types on the Exchange--that is, orders for Public Customers,
Market Makers, and Firm Proprietary--and shall be equal to the
execution fee and comparison fee currently charged by the Exchange for
Market Maker and Firm Proprietary transactions in equity options.\8\
The Exchange believes the proposed rule change will further the
Exchange's goal of introducing new products to the marketplace that are
competitively priced.
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release No. 51121 (Feb. 1,
2005), 70 FR 6476 (Feb. 7, 2005) (File No. SR-ISE-2005-01) (order
approving the trading of options on full and reduced values of the
Nasdaq-100 Stock Index).
\7\ The Exchange represents that these fees will be charged only
to Exchange members.
\8\ The execution fee is currently between $.21 and $.12 per
contract side, depending on the Exchange Average Daily Volume, and
the comparison fee is currently $.03 per contract side.
---------------------------------------------------------------------------
The Exchange has entered into a license agreement with The Nasdaq
Stock Market, Inc. in connection with the listing and trading of index
options on the Nasdaq-100 Stock Index. As with licensed equity options,
the Exchange is adopting a per contract fee for trading in these
options to defray the licensing
[[Page 15373]]
costs.\9\ The Exchange believes that charging the participants that
trade these instruments is the most equitable means of recovering the
costs of the license. However, because of competitive pressures in the
industry, the Exchange proposes to exclude Public Customer Orders \10\
from this surcharge fee. Accordingly, this surcharge fee will only be
charged to Exchange members with respect to non-Public Customer Orders
(e.g., Market Maker and Firm Proprietary orders) and shall apply to
Linkage Orders \11\ under a pilot program that is set to expire on July
31, 2005.
---------------------------------------------------------------------------
\9\ The Commission notes, however, that the proposed surcharge
fee of $0.15 per contract for NDX and MDX is higher than the current
surcharge fee level of $0.10 per contract on other products listed
in the ISE's Schedule of Fees.
\10\ Public Customer Order is defined in Exchange Rule
100(a)(33) as an order for the account of a Public Customer. Public
Customer is defined in Exchange Rule 100(a)(32) as a person that is
not a broker or dealer in securities.
\11\ See ISE Rule 1900(10) (defining Linkage Orders). The
surcharge fee will apply to the following Linkage Orders: Principal
Acting as Agent (``P/A'') Orders and Principal Orders.
---------------------------------------------------------------------------
2. Basis
The Exchange believes that the proposed rule change is consistent
with section 6(b)(4) of the Act,\12\ which requires that an exchange
have an equitable allocation of reasonable dues, fees and other charges
among its members and other persons using its facilities.
---------------------------------------------------------------------------
\12\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
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.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change: (1) Does not significantly
affect the protection of investors or the public interest; (2) does not
impose any significant burden on competition; and (3) does not become
operative for 30 days from the date on which it was filed, or such
shorter time as the Commission may designate if consistent with the
protection of investors and the public interest, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\13\ and Rule 19b-4(f)(6) thereunder.\14\
---------------------------------------------------------------------------
\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
A proposed rule change filed under Rule 19b-4(f)(6) does not become
operative prior to 30 days after the date of filing. However, Rule 19b-
4(f)(6)(iii) \15\ permits the Commission to designate a shorter time if
such action is consistent with the protection of investors and the
public interest. The Exchange has requested that the Commission waive
the 30-day operative delay and accelerate the implementation of the
proposed rule change so that it may take effect prior to the 30 days
specified in Rule 19b-4(f)(6)(iii). Since the proposed rule change does
not raise any novel issues and the Exchange customarily charges fees
for options traded on the Exchange, the Commission believes that
waiving the 30-day operative delay is consistent with the protection of
investors and the public interest.\16\ In designating the proposal
immediately operative, the Commission does not believe that the
proposed rule change raises any new issues of regulatory concern.
Accordingly, the Commission has waived the 30-day operative delay
requirement for this proposed rule change, and has determined to
designate the proposed rule change operative as of March 7, 2005, the
date of filing of the proposed rule change.
---------------------------------------------------------------------------
\15\ 17 CFR 240.19b-4(f)(6)(iii).
\16\ For purposes only of accelerating the operative date of
this proposal, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. See 15
U.S.C. 78c(f).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such proposed 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.\17\
---------------------------------------------------------------------------
\17\ See Section 19(b)(3)(C) of the Act, 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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File No. SR-ISE-2005-13 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-ISE-2005-13. 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 (https://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 such
filing also will be available for inspection and copying at the
principal office of the ISE. 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-ISE-2005-13 and should be submitted by April 15, 2005.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\18\
---------------------------------------------------------------------------
\18\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-1305 Filed 3-24-05; 8:45 am]
BILLING CODE 8010-01-P
