Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing of Proposed Rule Change by National Association of Securities Dealers, Inc. Regarding Fees for Closed-End Funds Listing on The Nasdaq SmallCap Market, 57638-57640 [E5-5354]
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57638
Federal Register / Vol. 70, No. 190 / Monday, October 3, 2005 / Notices
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) 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, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 9 and Rule 19b–
4(f)(6) thereunder.10
Nasdaq has requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest
because the proposed change rule
would permit Nasdaq to implement an
order type similar to one already in use
in the marketplace that may offer market
quality benefits. Therefore, the
Commission designates the proposal to
be effective and operative upon filing
with the Commission.11
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,
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 rulecomments@sec.gov. Please include File
Number SR–NASD–2005–113 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Jonathan G. Katz, Secretary,
Securities and Exchange Commission,
9 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
11 For purposes of waiving the 30-day operative
delay, the Commission has considered the proposed
rule’s impact on efficiency, competition, and capital
formation. 15 U.S.C. 78c(f).
10 17
VerDate Aug<31>2005
17:26 Sep 30, 2005
Jkt 205001
Station Place, 100 F Street, NE.,
Washington, DC 20549–9303.
All submissions should refer to File
Number SR–NASD–2005–113. 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 the filing also will be
available for inspection and copying at
the principal office of the NASD. 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–NASD–2005–113 and
should be submitted on or before
October 24, 2005.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.12
Jonathan G. Katz,
Secretary.
[FR Doc. E5–5346 Filed 9–30–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–52515; File No. SR–NASD–
2005–106]
Self-Regulatory Organizations;
National Association of Securities
Dealers, Inc.; Notice of Filing of
Proposed Rule Change by National
Association of Securities Dealers, Inc.
Regarding Fees for Closed-End Funds
Listing on The Nasdaq SmallCap
Market
September 27, 2005.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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notice is hereby given that on August
31, 2005, the National Association of
Securities Dealers, Inc. (‘‘NASD’’),
through its subsidiary, The Nasdaq
Stock Market, Inc. (‘‘Nasdaq’’), 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 Nasdaq. 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
Nasdaq proposes to amend NASD
Rules 4510 and 4520. The text of the
proposed rule change is below.
Proposed new language is italicized;
proposed deletions are in [brackets].
*
*
*
*
*
4510. The Nasdaq National Market
(a)–(c) No change.
(d) Annual Fee—American Depositary
Receipts (ADRs) and Closed-End Funds.
(1)–(3) No change.
(4) For the purpose of determining the
total shares outstanding, fund sponsors
may aggregate shares outstanding of all
Closed-End Funds in the same fund
family listed in The Nasdaq National
Market or The Nasdaq SmallCap
Market, as shown in the issuer’s most
recent periodic reports required to be
filed with the appropriate regulatory
authority or in more recent information
held by Nasdaq. The maximum annual
fee applicable to a fund family shall not
exceed $75,000. For purposes of this
rule, a ‘‘fund family’’ is defined as two
or more Closed-End Funds that have a
common investment adviser or have
investment advisers who are ‘‘affiliated
persons’’ as defined in Section 2(a)(3) of
the Investment Company Act of 1940, as
amended.
(5)–(6) No change.
(e) No change.
4520. The Nasdaq SmallCap Market
(a) Entry Fee.
(1)–(2) No change.
(3) A closed-end management
investment company registered under
the Investment Company Act of 1940, as
amended (a ‘‘Closed-End Fund’’), that
submits an application for inclusion of
securities in The Nasdaq SmallCap
Market shall pay to the Nasdaq Stock
Market, Inc. an entry fee of $5,000 (of
which $1,000 represents a nonrefundable, application fee).
([3]4) The Board of Directors of The
Nasdaq Stock Market, Inc. or its
designee may, in its discretion, defer or
E:\FR\FM\03OCN1.SGM
03OCN1
Federal Register / Vol. 70, No. 190 / Monday, October 3, 2005 / Notices
National Market fees for that calendar
year.
([5]6) Total shares outstanding means
the aggregate of all classes of equity
securities included in The Nasdaq
SmallCap Market as shown in the
issuer’s most recent periodic report
required to be filed with the issuer’s
appropriate regulatory authority or in
more recent information held by
Nasdaq. In the case of foreign issuers,
total shares outstanding shall include
only those shares issued and
outstanding in the United States.
(7) Notwithstanding paragraph (6), for
the purpose of determining the total
shares outstanding, fund sponsors may
aggregate shares outstanding of all
Closed-End Funds in the same fund
family listed in The Nasdaq National
Market and The Nasdaq SmallCap
Market, as shown in the issuer’s most
recent periodic reports required to be
filed with the appropriate regulatory
authority or in more recent information
held by Nasdaq. The maximum annual
fee applicable to a fund family shall not
exceed $75,000. For purposes of this
rule, a ‘‘fund family’’ is defined as two
or more Closed-End Funds that have a
common investment adviser or have
investment advisers who are ‘‘affiliated
persons’’ as defined in Section 2(a)(3) of
the Investment Company Act of 1940, as
amended.
([6]8) In lieu of the fees described in
Rule 4510(c)(1), the annual fee shall be
$15,000 for each issuer (i) whose
securities are listed on the New York
Stock Exchange and designated as
national market securities pursuant to
the plan governing New York Stock
Exchange securities at the time such
securities are approved for listing on
Nasdaq, and (ii) that maintains such
listing and designation after it lists such
securities on Nasdaq. Such annual fee
shall be assessed on the first anniversary
of the issuer’s listing on Nasdaq.
$15,000
(d) No change.
$17,500
*
*
*
*
$20,000 *
waive all or any part of the entry fee
prescribed herein.
([4]5) Total shares outstanding means
the aggregate of all classes of equity
securities to be included in The Nasdaq
SmallCap Market as shown in the
issuer’s most recent periodic report or in
more recent information held by Nasdaq
or, in the case of new issues, as shown
in the offering circular, required to be
filed with the issuer’s appropriate
regulatory authority.
([5]6) An issuer that submits an
application for inclusion of any class of
rights in The Nasdaq SmallCap Market,
shall pay, at the time of its application,
a non-refundable application fee to The
Nasdaq Stock Market of $1,000.
([6]7) The fees described in this Rule
4520(a) shall not be applicable with
respect to any securities that (i) are
listed on a national securities exchange
but not listed on Nasdaq, or (ii) are
listed on the New York Stock Exchange
and Nasdaq, if the issuer of such
securities transfers their listing
exclusively to the Nasdaq SmallCap
Market.
([7]8) The fees described in this Rule
4520(a) shall not be applicable to an
issuer (i) whose securities are listed on
the New York Stock Exchange and
designated as national market securities
pursuant to the plan governing New
York Stock Exchange securities at the
time such securities are approved for
listing on Nasdaq, and (ii) that
maintains such listing and designation
after it lists such securities on Nasdaq.
(b) No change.
(c) Annual Fee.
(1)–(2) No change.
(3) Notwithstanding paragraph (1), a
Closed-End Fund listed on The Nasdaq
SmallCap Market shall pay to The
Nasdaq Stock Market, Inc. an annual
fee calculated based on total shares
outstanding according to the following
schedule:
Up to 5 million shares ................
5+ to 10 million shares ...............
10+ to 25 million shares .............
25+ to 50 million shares .............
50+ to 100 million shares ...........
100+ to 250 million shares .........
Over 250 million shares ..............
$22,500
$30,000
$50,000
$75,000
([3]4) The Board of Directors of The
Nasdaq Stock Market, Inc. or its
designee may, in its discretion, defer or
waive all or any part of the annual fee
prescribed herein.
([4]5) If a class of securities is
removed from The Nasdaq SmallCap
Market, that portion of the annual fees
for such class of securities attributable
to the months following the date of
removal shall not be refunded, except
such portion shall be applied to Nasdaq
VerDate Aug<31>2005
17:26 Sep 30, 2005
Jkt 205001
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
Nasdaq 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. Nasdaq has prepared
summaries, set forth in sections A, B,
and C below, of the most significant
aspects of such statements.
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57639
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Currently, Closed-End Funds listing
on The Nasdaq SmallCap Market
(‘‘SmallCap Market’’) are required to pay
entry and annual fees according to the
applicable fee schedules set forth in
NASD Rule 4520.3 These entry fees
range from $25,000 to $50,000 and the
annual fees from $17,500 to $21,000.
Pursuant to the rule change, the entry
fee for listing a Closed-End Fund on the
SmallCap Market will decrease to
$5,000 (of which $1,000 is a nonrefundable application fee) per fund.
Annual fees will be based on the total
number of shares outstanding, with a
minimum fee of $15,000 and a
maximum fee of $75,000. For the
purposes of determining the annual fee,
fund sponsors will be permitted to
aggregate the shares outstanding of all
Closed-End Funds listed on either The
Nasdaq National Market (‘‘National
Market’’) or the SmallCap Market that
are part of the same fund family. As a
result, the annual fee may not exceed
$75,000 per fund family. For the
purposes of this rule, a ‘‘fund family’’ is
defined as two or more Closed-End
Funds that share a common investment
adviser or investment advisers who are
‘‘affiliated persons’’ as defined in
Section 2(a)(3) of the Investment
Company Act of 1940, as amended.
Nasdaq believes there are several
reasons to adopt new fees applicable to
Closed-End Funds listing on the
SmallCap Market. First, the new annual
fee schedule would accommodate the
needs of fund sponsors more effectively
than the current fee schedule because
sponsors often choose to issue and list
multiple funds in the same family.
Currently, each fund that is listed on
The SmallCap Market is assessed a
separate annual fee. Under the proposed
rules, fund families would be permitted
to aggregate shares outstanding of listed
funds to determine the annual fee,
subject to an annual cap of $75,000 per
fund family.
Second, under the proposed rule
change, funds listed on the SmallCap
Market would be subject to a schedule
of annual fees identical to that of funds
listed on the National Market.4 Because
3 Closed-End Funds are evaluated for listing on
the SmallCap Market under the general initial
listing criteria contained in NASD Rules 4310 and
4320.
4 Nasdaq recently adopted new listing fees for
Closed-End Funds listing on the National Market.
See Securities Exchange Act Release No. 52277
E:\FR\FM\03OCN1.SGM
Continued
03OCN1
57640
Federal Register / Vol. 70, No. 190 / Monday, October 3, 2005 / Notices
fund families would be permitted to
aggregate shares outstanding across
markets for the purposes of calculating
the annual fee, Nasdaq believes that
matching fee schedules would minimize
problems that could arise if fund
families listing funds on both the
National Market and SmallCap Market
were subject to conflicting fee
schedules. Although an individual fund
listing on the SmallCap Market with
over 25 million total shares outstanding
would be subject to an increase in
annual fees under the proposed rules,
Nasdaq believes the benefits of
substantially lower entry fees and the
ability of fund families to aggregate
shares across markets outweigh the
burden to funds of the limited fee
increase.
Finally, in many cases where multiple
funds are listed, the new fee schedule
would lower fees payable by Closed-End
Funds, thereby benefiting the fund
investors that ultimately pay those
expenses by reducing the costs
associated with listing fund shares. In
addition, Nasdaq believes that
establishing lower fees for fund families
would permit Nasdaq to compete more
effectively for listings with other
markets.
Nasdaq believes that the proposed
rule change is consistent with the
provisions of Section 15A of the Act,5 in
general, and with Section 15A(b)(5) of
the Act,6 in particular, in that it
provides for the equitable allocation of
reasonable fees, dues, and other charges
among members and issuers and other
persons using any facility or system
which the NASD operates or controls.
The proposed change to the entry and
annual fees will apply equally to all
Closed-End Funds listing on The
Nasdaq SmallCap Market. Furthermore,
Nasdaq believes that the proposed fees
are reasonable and fall within the range
of fees charged by other markets.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Nasdaq does not believe that the
proposed rule change would impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
(August 17, 2005), 70 FR 49347 (August 23, 2005)
(SR–NASD–2005–096).
5 15 U.S.C. 78o–3.
6 15 U.S.C. 78o–3(b)(5).
17:26 Sep 30, 2005
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding, or
(ii) as to which the NYSE consents, the
Commission will:
A. By order approve such proposed
rule change; or
B. institute proceedings to determine
whether the proposed rule change
should be disapproved.
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 Nasdaq. 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 publicly available. All
submissions should refer to File
Number SR–NASD–2005–106 and
should be submitted on or before
October 24, 2005.7
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.7
Jonathan G. Katz,
Secretary.
[FR Doc. E5–5354 Filed 9–30–05; 8:45 am]
BILLING CODE 8010–01–P
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:
DEPARTMENT OF STATE
[Public Notice 5198]
60-Day Notice of Proposed Information
Collection: Form DS–86, Statement of
Non-Receipt of a Passport, OMB
Control Number 1405–0146
Electronic Comments
2. Statutory Basis
VerDate Aug<31>2005
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Jkt 205001
• 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
Number SR–NASD–2005–106 on the
subject line.
Notice of request for public
comments.
ACTION:
SUMMARY: The Department of State is
seeking Office of Management and
Budget (OMB) approval for the
information collection described below.
The purpose of this notice is to allow 60
days for public comment in the Federal
Paper Comments
Register preceding submission to OMB.
• Send paper comments in triplicate
We are conducting this process in
to Jonathan G. Katz, Secretary,
accordance with the Paperwork
Securities and Exchange Commission,
Reduction Act of 1995.
Station Place, 100 F Street, NE.,
• Title of Information Collection:
Washington, DC 20549–9303.
Statement of Non-Receipt of A Passport
All submissions should refer to File
• OMB Control Number: 1405–0146
Number SR–NASD–2005–106. This file
• Type of Request: Extension of the
number should be included on the
currently approved collection
subject line if e-mail is used. To help the
• Originating Office: Bureau of
Commission process and review your
Consular Affairs, Department of State,
comments more efficiently, please use
Passport Services, Office of Field
only one method. The Commission will Operations, Field Coordination
post all comments on the Commission’s Division. CA/PPT/FO/FC.
Internet Web site (https://www.sec.gov/
• Form Number: DS–86
rules/sro.shtml). Copies of the
• Respondents: Individuals or
submission, all subsequent
Households
amendments, all written statements
• Estimated Number of Respondents:
with respect to the proposed rule
23,500
change that are filed with the
• Estimated Number of Responses:
Commission, and all written
23,500
communications relating to the
• Average Hours Per Response: 1/12
proposed rule change between the
hr. (5 min.)
Commission and any person, other than
7 17 CFR 200.30–3(a)(12).
those that may be withheld from the
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03OCN1
Agencies
[Federal Register Volume 70, Number 190 (Monday, October 3, 2005)]
[Notices]
[Pages 57638-57640]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-5354]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-52515; File No. SR-NASD-2005-106]
Self-Regulatory Organizations; National Association of Securities
Dealers, Inc.; Notice of Filing of Proposed Rule Change by National
Association of Securities Dealers, Inc. Regarding Fees for Closed-End
Funds Listing on The Nasdaq SmallCap Market
September 27, 2005.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on August 31, 2005, the National Association of Securities Dealers,
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc.
(``Nasdaq''), 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 Nasdaq. 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.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Nasdaq proposes to amend NASD Rules 4510 and 4520. The text of the
proposed rule change is below. Proposed new language is italicized;
proposed deletions are in [brackets].
* * * * *
4510. The Nasdaq National Market
(a)-(c) No change.
(d) Annual Fee--American Depositary Receipts (ADRs) and Closed-End
Funds.
(1)-(3) No change.
(4) For the purpose of determining the total shares outstanding,
fund sponsors may aggregate shares outstanding of all Closed-End Funds
in the same fund family listed in The Nasdaq National Market or The
Nasdaq SmallCap Market, as shown in the issuer's most recent periodic
reports required to be filed with the appropriate regulatory authority
or in more recent information held by Nasdaq. The maximum annual fee
applicable to a fund family shall not exceed $75,000. For purposes of
this rule, a ``fund family'' is defined as two or more Closed-End Funds
that have a common investment adviser or have investment advisers who
are ``affiliated persons'' as defined in Section 2(a)(3) of the
Investment Company Act of 1940, as amended.
(5)-(6) No change.
(e) No change.
4520. The Nasdaq SmallCap Market
(a) Entry Fee.
(1)-(2) No change.
(3) A closed-end management investment company registered under the
Investment Company Act of 1940, as amended (a ``Closed-End Fund''),
that submits an application for inclusion of securities in The Nasdaq
SmallCap Market shall pay to the Nasdaq Stock Market, Inc. an entry fee
of $5,000 (of which $1,000 represents a non-refundable, application
fee).
([3]4) The Board of Directors of The Nasdaq Stock Market, Inc. or
its designee may, in its discretion, defer or
[[Page 57639]]
waive all or any part of the entry fee prescribed herein.
([4]5) Total shares outstanding means the aggregate of all classes
of equity securities to be included in The Nasdaq SmallCap Market as
shown in the issuer's most recent periodic report or in more recent
information held by Nasdaq or, in the case of new issues, as shown in
the offering circular, required to be filed with the issuer's
appropriate regulatory authority.
([5]6) An issuer that submits an application for inclusion of any
class of rights in The Nasdaq SmallCap Market, shall pay, at the time
of its application, a non-refundable application fee to The Nasdaq
Stock Market of $1,000.
([6]7) The fees described in this Rule 4520(a) shall not be
applicable with respect to any securities that (i) are listed on a
national securities exchange but not listed on Nasdaq, or (ii) are
listed on the New York Stock Exchange and Nasdaq, if the issuer of such
securities transfers their listing exclusively to the Nasdaq SmallCap
Market.
([7]8) The fees described in this Rule 4520(a) shall not be
applicable to an issuer (i) whose securities are listed on the New York
Stock Exchange and designated as national market securities pursuant to
the plan governing New York Stock Exchange securities at the time such
securities are approved for listing on Nasdaq, and (ii) that maintains
such listing and designation after it lists such securities on Nasdaq.
(b) No change.
(c) Annual Fee.
(1)-(2) No change.
(3) Notwithstanding paragraph (1), a Closed-End Fund listed on The
Nasdaq SmallCap Market shall pay to The Nasdaq Stock Market, Inc. an
annual fee calculated based on total shares outstanding according to
the following schedule:
Up to 5 million shares....................................... $15,000
5+ to 10 million shares...................................... $17,500
10+ to 25 million shares..................................... $20,000
25+ to 50 million shares..................................... $22,500
50+ to 100 million shares.................................... $30,000
100+ to 250 million shares................................... $50,000
Over 250 million shares...................................... $75,000
([3]4) The Board of Directors of The Nasdaq Stock Market, Inc. or
its designee may, in its discretion, defer or waive all or any part of
the annual fee prescribed herein.
([4]5) If a class of securities is removed from The Nasdaq SmallCap
Market, that portion of the annual fees for such class of securities
attributable to the months following the date of removal shall not be
refunded, except such portion shall be applied to Nasdaq National
Market fees for that calendar year.
([5]6) Total shares outstanding means the aggregate of all classes
of equity securities included in The Nasdaq SmallCap Market as shown in
the issuer's most recent periodic report required to be filed with the
issuer's appropriate regulatory authority or in more recent information
held by Nasdaq. In the case of foreign issuers, total shares
outstanding shall include only those shares issued and outstanding in
the United States.
(7) Notwithstanding paragraph (6), for the purpose of determining
the total shares outstanding, fund sponsors may aggregate shares
outstanding of all Closed-End Funds in the same fund family listed in
The Nasdaq National Market and The Nasdaq SmallCap Market, as shown in
the issuer's most recent periodic reports required to be filed with the
appropriate regulatory authority or in more recent information held by
Nasdaq. The maximum annual fee applicable to a fund family shall not
exceed $75,000. For purposes of this rule, a ``fund family'' is defined
as two or more Closed-End Funds that have a common investment adviser
or have investment advisers who are ``affiliated persons'' as defined
in Section 2(a)(3) of the Investment Company Act of 1940, as amended.
([6]8) In lieu of the fees described in Rule 4510(c)(1), the annual
fee shall be $15,000 for each issuer (i) whose securities are listed on
the New York Stock Exchange and designated as national market
securities pursuant to the plan governing New York Stock Exchange
securities at the time such securities are approved for listing on
Nasdaq, and (ii) that maintains such listing and designation after it
lists such securities on Nasdaq. Such annual fee shall be assessed on
the first anniversary of the issuer's listing on Nasdaq.
(d) No change.
* * * * *
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, Nasdaq 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. Nasdaq 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
Currently, Closed-End Funds listing on The Nasdaq SmallCap Market
(``SmallCap Market'') are required to pay entry and annual fees
according to the applicable fee schedules set forth in NASD Rule
4520.\3\ These entry fees range from $25,000 to $50,000 and the annual
fees from $17,500 to $21,000.
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\3\ Closed-End Funds are evaluated for listing on the SmallCap
Market under the general initial listing criteria contained in NASD
Rules 4310 and 4320.
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Pursuant to the rule change, the entry fee for listing a Closed-End
Fund on the SmallCap Market will decrease to $5,000 (of which $1,000 is
a non-refundable application fee) per fund. Annual fees will be based
on the total number of shares outstanding, with a minimum fee of
$15,000 and a maximum fee of $75,000. For the purposes of determining
the annual fee, fund sponsors will be permitted to aggregate the shares
outstanding of all Closed-End Funds listed on either The Nasdaq
National Market (``National Market'') or the SmallCap Market that are
part of the same fund family. As a result, the annual fee may not
exceed $75,000 per fund family. For the purposes of this rule, a ``fund
family'' is defined as two or more Closed-End Funds that share a common
investment adviser or investment advisers who are ``affiliated
persons'' as defined in Section 2(a)(3) of the Investment Company Act
of 1940, as amended.
Nasdaq believes there are several reasons to adopt new fees
applicable to Closed-End Funds listing on the SmallCap Market. First,
the new annual fee schedule would accommodate the needs of fund
sponsors more effectively than the current fee schedule because
sponsors often choose to issue and list multiple funds in the same
family. Currently, each fund that is listed on The SmallCap Market is
assessed a separate annual fee. Under the proposed rules, fund families
would be permitted to aggregate shares outstanding of listed funds to
determine the annual fee, subject to an annual cap of $75,000 per fund
family.
Second, under the proposed rule change, funds listed on the
SmallCap Market would be subject to a schedule of annual fees identical
to that of funds listed on the National Market.\4\ Because
[[Page 57640]]
fund families would be permitted to aggregate shares outstanding across
markets for the purposes of calculating the annual fee, Nasdaq believes
that matching fee schedules would minimize problems that could arise if
fund families listing funds on both the National Market and SmallCap
Market were subject to conflicting fee schedules. Although an
individual fund listing on the SmallCap Market with over 25 million
total shares outstanding would be subject to an increase in annual fees
under the proposed rules, Nasdaq believes the benefits of substantially
lower entry fees and the ability of fund families to aggregate shares
across markets outweigh the burden to funds of the limited fee
increase.
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\4\ Nasdaq recently adopted new listing fees for Closed-End
Funds listing on the National Market. See Securities Exchange Act
Release No. 52277 (August 17, 2005), 70 FR 49347 (August 23, 2005)
(SR-NASD-2005-096).
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Finally, in many cases where multiple funds are listed, the new fee
schedule would lower fees payable by Closed-End Funds, thereby
benefiting the fund investors that ultimately pay those expenses by
reducing the costs associated with listing fund shares. In addition,
Nasdaq believes that establishing lower fees for fund families would
permit Nasdaq to compete more effectively for listings with other
markets.
2. Statutory Basis
Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 15A of the Act,\5\ in general, and with
Section 15A(b)(5) of the Act,\6\ in particular, in that it provides for
the equitable allocation of reasonable fees, dues, and other charges
among members and issuers and other persons using any facility or
system which the NASD operates or controls. The proposed change to the
entry and annual fees will apply equally to all Closed-End Funds
listing on The Nasdaq SmallCap Market. Furthermore, Nasdaq believes
that the proposed fees are reasonable and fall within the range of fees
charged by other markets.
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\5\ 15 U.S.C. 78o-3.
\6\ 15 U.S.C. 78o-3(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
Nasdaq does not believe that the proposed rule change would 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
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding, or (ii) as to
which the NYSE consents, the Commission will:
A. By order approve such proposed rule change; or
B. institute proceedings to determine whether the proposed rule
change should be disapproved.
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 Number SR-NASD-2005-106 on the subject line.
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-9303.
All submissions should refer to File Number SR-NASD-2005-106. 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 Nasdaq. 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 publicly available. All submissions should refer to
File Number SR-NASD-2005-106 and should be submitted on or before
October 24, 2005.\7\
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\7\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\7\
Jonathan G. Katz,
Secretary.
[FR Doc. E5-5354 Filed 9-30-05; 8:45 am]
BILLING CODE 8010-01-P