Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Remote Streaming Quote Trader Permit Fees, 959-961 [E6-21]

Download as PDF Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices rejected to the initiating brokerage firm for rerouting to a competing exchange. Due to delays in technology development, the PCX has not been able to implement an automated outbound Linkage function into the PCX Plus trading system. The PCX is presently developing a new enhanced options trading system, called the OX System. Included in the design plans for the OX System is functionality that will route outbound Linkage orders to other exchanges via an automated process. 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)(5) of the Act 5 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to and perfect the mechanism of a free and open market and a national market system. 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. cprice-sewell on PROD1PC66 with 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 Because the proposed rule change: (i) Does not significantly affect the protection of investors or the public interest; (ii) does not impose any significant burden on competition; and (iii) by its terms, does not become operative for 30 days after the date of filing, 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 6 and subparagraph (f)(6) of Rule 19b–4 thereunder.7 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–PCX–2005–132 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–PCX–2005–132. 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 U.S.C. 78f(b). U.S.C. 78f(b)(5). 6 6 15 U.S.C. 78s(b)(3)(A). 7 17 CFR 240.19b–4(f)(6). Jkt 208001 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 Section, 100 F Street, NE., Washington, DC 20549. Copies of such 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–2005–132 and should be submitted on or before January 27, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.9 Jonathan G. Katz, Secretary. [FR Doc. E6–20 Filed 1–5–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53043; File No. SR–Phlx– 2005–72] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Remote Streaming Quote Trader Permit Fees December 29, 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 November 10, 2005, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ 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 Phlx. On December 19, 2005, the Phlx submitted Amendment No. 1 to the proposed rule change.3 The Exchange has designated 9 17 the 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. 15 U.S.C. 78c(f). 5 15 15:23 Jan 05, 2006 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: 8 For 4 15 VerDate Aug<31>2005 The Exchange has requested that the Commission waive the 30-day operative delay period for ‘‘non-controversial’’ proposals and make the proposed rule change effective and operative upon filing. The Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest, because PCX Rule 6.82(c)(15) has never become operative (as its operative date was January 1, 2006), and deleting a rule that has never become operative has no real effect and thus raises no issues of regulatory concern. For this reason, the Commission designates the proposal to be effective and operative upon filing with the Commission.8 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 the furtherance of the purposes of the Act. 959 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 In Amendment No. 1, the Exchange revised the proposed rule text to clarify that RSQTs and SQTs 1 15 E:\FR\FM\06JAN1.SGM Continued 06JAN1 960 Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices the proposed rule change as one establishing or changing a due, fee, or other charge imposed by the Phlx pursuant to Section 19(b)(3)(A)(ii) of the Act 4 and Rule 19b–4(f)(2) thereunder,5 which renders the proposal effective upon filing with the Commission.6 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 cprice-sewell on PROD1PC66 with NOTICES The Phlx proposes to amend its permit fee schedule to assess a permit fee on Remote Streaming Quote Traders (‘‘RSQTs’’) 7 under the Registered Options Trader (‘‘ROT’’) permit fee category. In addition, the Exchange proposes to amend its permit fee schedule to clarify that Streaming Quote Traders (‘‘SQTs’’) 8 are currently included in the ROT permit fee category.9 The text of the proposed rule change is available on the Exchange’s Web site (https://www.phlx.com), at the Phlx, and at the Commission’s Public Reference Room. will be included in the ROT permit fee category. The Exchange also amended the purpose section to clarify that, by including RSQTs in the ROT permit fee category, the Exchange will be assessing a new permit fee on RSQTs. 4 15 U.S.C. 78s(b)(3)(A)(ii). 5 17 CFR 240.19b–4(f)(2). 6 The effective date of the original proposed rule change is November 10, 2005, and the effective date of Amendment No. 1 is December 19, 2005. 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 the period to commence on December 19, 2005, the date on which the Exchange submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). 7 An RSQT is an Exchange ROT that is a member or member organization of the Exchange with no physical trading floor presence who has received permission from the Exchange to generate and submit option quotations electronically through the Exchange’s Automated Options Market in eligible options in which such RSQT has been assigned. An RSQT may only trade in a market making capacity in classes of options in which he is assigned. An RSQT may only submit such quotations electronically from off the floor of the Exchange. See Phlx Rule 1014(b)(ii)(B). 8 An SQT is a ROT who has received permission from the Exchange to generate and submit option quotations electronically through an electronic interface with the Exchange’s automated options market (‘‘AUTOM’’) via an Exchange approved proprietary electronic quoting device in eligible options to which the SQT is assigned. See Exchange Rule 1014(b)(ii). 9 Currently, SQTs are assessed a permit fee under the ROT (on any trading floor) category, but are not specifically referred to on the Exchange’s fee schedule. VerDate Aug<31>2005 15:23 Jan 05, 2006 Jkt 208001 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 Phlx 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 Phlx 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 Phlx recently adopted equity option fees applicable to RSQTs.10 In addition to the equity options fees assessed on RSQTs, RSQTs must also pay a monthly permit fee. Presently, RSQTs do not pay a ROT permit fee because they are not on any trading floor 11 and are thus not included in the ROT permit fee category on the Exchange’s fee schedule. However, RSQTs pay a permit fee under another category of permit fees such as a specialist or an order flow provider.12 Currently, monthly permit fees are assessed as follows: Permit Fees 13 Order Flow Provider Permit Fee 14 10 See Securities Exchange Act Release No. 51428 (March 24, 2005), 70 FR 16325 (March 30, 2005) (SR–Phlx–2005–12). 11 See definition of ‘‘RSQT,’’ supra note 7. 12 The Exchange assesses permit fees on its members. Monthly permit fees are assessed based on how each permit is used, for example, order flow provider, specialist or floor broker. However, any member who qualifies a member organization in more than one category of permit fees pays the higher of the applicable fees for such permit. For example, if an RSQT permit holder qualifies a member organization as an order flow provider and the RSQT permit holder associated with the member organization then registered as a floor broker on the Exchange for that or another member organization, that RSQT permit holder would be subject to a permit fee of $1,200, the higher of $200 (the order flow provider permit fee) and $1,200 (the floor broker permit fee), but not both fees. 13 The Exchange has established the date of notification of termination of a permit as the date that permit fee billing will cease. Additionally, a permit holder will be billed only one monthly permit fee if the holder transfers from one member organization to another previously unrelated member organization as a result of a merger, partial sale or other business combination during a monthly permit fee period in order to avoid double billing in the month the merger or business combination occurred. If the permit holder transfers from one member organization to another unrelated member organization in the same month, both member organizations are assessed a permit fee in the same billing period. 14 This fee applies to a permit held by a permit holder who does not have physical access to the PO 00000 Frm 00057 Fmt 4703 Sfmt 4703 a. Permits used only to submit orders to the equity, foreign currency options, or options trading floor (one floor only): $200.00 per month. b. Permits used only to submit orders to more than one trading floor: $300.00 per month. Floor Broker, Specialist, or ROT (on any trading floor) or Off-Floor Trader Permit Fee a. First Permit: $1,200.00 per month. b. Additional permits for members in the same organization: $1,000.00 per month. Excess Permit Holders: $200.00 per month. Other Permit Holders: 15 $200.00 per month. Any member who is associated with one or more member organizations and uses a permit in more than one category pays the higher of the applicable fees for such permit. Because RSQTs do not have a physical presence on the trading floor, but are a subset of ROTs, the Exchange proposes to assess the same permit fees on RSQTs as ROTs on any trading floor. As such, the Exchange proposes to replace the words ‘‘on any trading floor’’ that appear after the ROT category with ‘‘including RSQTs and SQTs.’’ 16 In addition, although SQTs have a physical presence on the trading floor and are thus currently included in the ROT (on any trading floor) permit fee Exchange’s trading floor, is not registered as a Floor Broker, Specialist or ROT (on any trading floor) or Off-Floor trader, and whose member organization submits orders to the Exchange. Phlx Rule 620(a) requires such registration. 15 A permit holder or the member organization they solely qualify must apply for ‘‘other’’ status in writing to the Membership Services Department. This status requires that a permit holder or the member organization have no transaction activity for the applicable monthly billing period. Should a permit holder actively transact business during a particular month, the highest applicable monthly permit fee will apply to such permit holder and member organization for that monthly period. The ‘‘other’’ status only applies to permit holders who solely qualify their member organization. These policies were effective as of February 2, 2004. 16 As a practical matter, the effect of including RSQTs in the ROT permit fee category should not increase overall costs to the RSQTs due to the fact that RSQTs receive a permit credit, which is applied against a member organization’s RSQT fees. Specifically, pursuant to the Exchange’s fee schedule, RSQTs are assessed an RSQT fee based on the number and type of option issues in which an RSQT is assigned. A credit is given to RSQTs based on the total number of permits held by the RSQT in a particular calendar month. For example, currently an RSQT may receive a monthly credit of $200 (which is the same amount as the permit fee) because the permit holder qualifies a member organization as an order flow provider. Now, under this proposal, the RSQT will be charged a higher permit fee of $1,200, but receive a permit credit of $1,200 to be applied against the RSQT fee. See Securities Exchange Act Release No. 51428 (March 24, 2005), 70 FR 16325 (March 30, 2005) (SR–Phlx– 2005–12). E:\FR\FM\06JAN1.SGM 06JAN1 Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–Phlx–2005–72 on the subject line. category, the Exchange proposes to specifically refer to SQTs on the fee schedule in order to help clarify that SQTs are also included in the ROT category. 2. Statutory Basis The Exchange believes that its proposal to amend its schedule of fees is consistent with Section 6(b) of the Act,17 in general, and furthers the objectives of Section 6(b)(4) of the Act,18 in particular, in that it is an equitable allocation of reasonable fees among Exchange members. 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 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 No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change has been designated as a fee change pursuant to Section 19(b)(3)(A)(ii) of the Act 19 and Rule 19b–4(f)(2) 20 thereunder. Accordingly, the proposal will take effect upon filing with the Commission. At any time within 60 days of the filing of Amendment No. 1 to 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.21 cprice-sewell on PROD1PC66 with NOTICES 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 17 15 U.S.C. 78f(b). U.S.C. 78f(b)(4). 19 15 U.S.C. 78s(b)(3)(A)(ii). 20 17 CFR 240.19b–4(f)(2). 21 See supra note 6. 18 15 VerDate Aug<31>2005 15:23 Jan 05, 2006 Jkt 208001 961 Public Law 104–13, the Paperwork Reduction Act of 1995, effective October 1, 1995. The information collection packages that may be included in this notice are for new information Paper Comments collections, approval of existing • Send paper comments in triplicate information collections, revisions to to Jonathan G. Katz, Secretary, OMB-approved information collections, Securities and Exchange Commission, and extensions (no change) of OMB100 F Street, NE., Washington, DC approved information collections. 20549–9303. SSA is soliciting comments on the All submissions should refer to File accuracy of the agency’s burden Number SR–Phlx–2005–72. This file estimate; the need for the information; number should be included on the its practical utility; ways to enhance its subject line if e-mail is used. To help the quality, utility, and clarity; and on ways Commission process and review your to minimize burden on respondents, comments more efficiently, please use including the use of automated only one method. The Commission will collection techniques or other forms of post all comments on the Commission’s information technology. Written Internet Web site (https://www.sec.gov/ comments and recommendations rules/sro.shtml). Copies of the regarding the information collection(s) submission, all subsequent should be submitted to the OMB Desk amendments, all written statements Officer and the SSA Reports Clearance with respect to the proposed rule Officer. The information can be mailed change that are filed with the and/or faxed to the individuals at the Commission, and all written addresses and fax numbers listed below: communications relating to the (OMB) Office of Management and proposed rule change between the Budget, Attn: Desk Officer for SSA, Fax: Commission and any person, other than 202–395–6974. those that may be withheld from the (SSA) Social Security Administration, public in accordance with the DCFAM, Attn: Reports Clearance provisions of 5 U.S.C. 552, will be Officer, 1333 Annex Building, 6401 available for inspection and copying in Security Blvd., Baltimore, MD 21235. the Commission’s Public Reference Fax: 410–965–6400. Room. Copies of the filing also will be I. The information collections listed available for inspection and copying at below are pending at SSA and will be the principal office of the Exchange. All submitted to OMB within 60 days from comments received will be posted the date of this notice. Therefore, your without change; the Commission does comments should be submitted to SSA not edit personal identifying within 60 days from the date of this information from submissions. You publication. You can obtain copies of should submit only information that you wish to make available publicly. All the collection instruments by calling the SSA Reports Clearance Officer at 410– submissions should refer to File 965–0454 or by writing to the address Number SR–Phlx–2005–72 and should listed above. be submitted on or before January 27, 1. Work Activity Report—Employee— 2006. 20 CFR 404.1520(b), 404.1571–.1576, For the Commission, by the Division of 404.1584–.1593, and 416.971–.976— Market Regulation, pursuant to delegated 0960–0059. Form SSA–821–BK collects 22 authority. information that provides evidence Jonathan G. Katz, necessary to determine initial or Secretary. continuing eligibility for Supplemental [FR Doc. E6–21 Filed 1–5–06; 8:45 am] Security Income (SSI) or Social Security BILLING CODE 8010–01–P disability benefits. An individual’s entitlement to benefits ends if he/she demonstrates an ability to perform SOCIAL SECURITY ADMINISTRATION substantial gainful activity (SGA). This form is used to determine whether work Agency Information Collection an individual performs in employment Activities: Proposed Request and is at the SGA level. The respondents are Comment Request Social Security disability applicants and beneficiaries; and SSI applicants. The Social Security Administration Type of Request: Extension of an (SSA) publishes a list of information OMB-approved information collection. collection packages that will require Number of Respondents: 300,000. clearance by the Office of Management Frequency of Response: 1. and Budget (OMB) in compliance with Average Burden per Response: 45 22 17 CFR 200.30–3(a)(12). minutes. PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 E:\FR\FM\06JAN1.SGM 06JAN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 71, Number 4 (Friday, January 6, 2006)]
[Notices]
[Pages 959-961]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-21]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53043; File No. SR-Phlx-2005-72]


Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto Relating to Remote Streaming Quote Trader 
Permit Fees

December 29, 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 November 10, 2005, the Philadelphia Stock Exchange, Inc. (``Phlx'' 
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 Phlx. On December 
19, 2005, the Phlx submitted Amendment No. 1 to the proposed rule 
change.\3\ The Exchange has designated

[[Page 960]]

the proposed rule change as one establishing or changing a due, fee, or 
other charge imposed by the Phlx pursuant to Section 19(b)(3)(A)(ii) of 
the Act \4\ and Rule 19b-4(f)(2) thereunder,\5\ which renders the 
proposal effective upon filing with the Commission.\6\ 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.
    \3\ In Amendment No. 1, the Exchange revised the proposed rule 
text to clarify that RSQTs and SQTs will be included in the ROT 
permit fee category. The Exchange also amended the purpose section 
to clarify that, by including RSQTs in the ROT permit fee category, 
the Exchange will be assessing a new permit fee on RSQTs.
    \4\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \5\ 17 CFR 240.19b-4(f)(2).
    \6\ The effective date of the original proposed rule change is 
November 10, 2005, and the effective date of Amendment No. 1 is 
December 19, 2005. 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 the period to commence on December 19, 2005, the date on 
which the Exchange submitted Amendment No. 1. See 15 U.S.C. 
78s(b)(3)(C).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Phlx proposes to amend its permit fee schedule to assess a 
permit fee on Remote Streaming Quote Traders (``RSQTs'') \7\ under the 
Registered Options Trader (``ROT'') permit fee category. In addition, 
the Exchange proposes to amend its permit fee schedule to clarify that 
Streaming Quote Traders (``SQTs'') \8\ are currently included in the 
ROT permit fee category.\9\ The text of the proposed rule change is 
available on the Exchange's Web site (https://www.phlx.com), at the 
Phlx, and at the Commission's Public Reference Room.
---------------------------------------------------------------------------

    \7\ An RSQT is an Exchange ROT that is a member or member 
organization of the Exchange with no physical trading floor presence 
who has received permission from the Exchange to generate and submit 
option quotations electronically through the Exchange's Automated 
Options Market in eligible options in which such RSQT has been 
assigned. An RSQT may only trade in a market making capacity in 
classes of options in which he is assigned. An RSQT may only submit 
such quotations electronically from off the floor of the Exchange. 
See Phlx Rule 1014(b)(ii)(B).
    \8\ An SQT is a ROT who has received permission from the 
Exchange to generate and submit option quotations electronically 
through an electronic interface with the Exchange's automated 
options market (``AUTOM'') via an Exchange approved proprietary 
electronic quoting device in eligible options to which the SQT is 
assigned. See Exchange Rule 1014(b)(ii).
    \9\ Currently, SQTs are assessed a permit fee under the ROT (on 
any trading floor) category, but are not specifically referred to on 
the Exchange's fee schedule.
---------------------------------------------------------------------------

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 Phlx 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 Phlx 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
    Phlx recently adopted equity option fees applicable to RSQTs.\10\ 
In addition to the equity options fees assessed on RSQTs, RSQTs must 
also pay a monthly permit fee. Presently, RSQTs do not pay a ROT permit 
fee because they are not on any trading floor \11\ and are thus not 
included in the ROT permit fee category on the Exchange's fee schedule. 
However, RSQTs pay a permit fee under another category of permit fees 
such as a specialist or an order flow provider.\12\ Currently, monthly 
permit fees are assessed as follows:

    \10\ See Securities Exchange Act Release No. 51428 (March 24, 
2005), 70 FR 16325 (March 30, 2005) (SR-Phlx-2005-12).
    \11\ See definition of ``RSQT,'' supra note 7.
    \12\ The Exchange assesses permit fees on its members. Monthly 
permit fees are assessed based on how each permit is used, for 
example, order flow provider, specialist or floor broker. However, 
any member who qualifies a member organization in more than one 
category of permit fees pays the higher of the applicable fees for 
such permit. For example, if an RSQT permit holder qualifies a 
member organization as an order flow provider and the RSQT permit 
holder associated with the member organization then registered as a 
floor broker on the Exchange for that or another member 
organization, that RSQT permit holder would be subject to a permit 
fee of $1,200, the higher of $200 (the order flow provider permit 
fee) and $1,200 (the floor broker permit fee), but not both fees.
---------------------------------------------------------------------------

Permit Fees \13\
---------------------------------------------------------------------------

    \13\ The Exchange has established the date of notification of 
termination of a permit as the date that permit fee billing will 
cease. Additionally, a permit holder will be billed only one monthly 
permit fee if the holder transfers from one member organization to 
another previously unrelated member organization as a result of a 
merger, partial sale or other business combination during a monthly 
permit fee period in order to avoid double billing in the month the 
merger or business combination occurred. If the permit holder 
transfers from one member organization to another unrelated member 
organization in the same month, both member organizations are 
assessed a permit fee in the same billing period.
---------------------------------------------------------------------------

Order Flow Provider Permit Fee \14\
---------------------------------------------------------------------------

    \14\ This fee applies to a permit held by a permit holder who 
does not have physical access to the Exchange's trading floor, is 
not registered as a Floor Broker, Specialist or ROT (on any trading 
floor) or Off-Floor trader, and whose member organization submits 
orders to the Exchange. Phlx Rule 620(a) requires such registration.
---------------------------------------------------------------------------

    a. Permits used only to submit orders to the equity, foreign 
currency options, or options trading floor (one floor only): $200.00 
per month.
    b. Permits used only to submit orders to more than one trading 
floor: $300.00 per month.

Floor Broker, Specialist, or ROT (on any trading floor) or Off-Floor 
Trader Permit Fee
    a. First Permit: $1,200.00 per month.
    b. Additional permits for members in the same organization: 
$1,000.00 per month.

Excess Permit Holders: $200.00 per month.
Other Permit Holders: \15\ $200.00 per month.
---------------------------------------------------------------------------

    \15\ A permit holder or the member organization they solely 
qualify must apply for ``other'' status in writing to the Membership 
Services Department. This status requires that a permit holder or 
the member organization have no transaction activity for the 
applicable monthly billing period. Should a permit holder actively 
transact business during a particular month, the highest applicable 
monthly permit fee will apply to such permit holder and member 
organization for that monthly period. The ``other'' status only 
applies to permit holders who solely qualify their member 
organization. These policies were effective as of February 2, 2004.

Any member who is associated with one or more member organizations and 
uses a permit in more than one category pays the higher of the 
applicable fees for such permit.
    Because RSQTs do not have a physical presence on the trading floor, 
but are a subset of ROTs, the Exchange proposes to assess the same 
permit fees on RSQTs as ROTs on any trading floor. As such, the 
Exchange proposes to replace the words ``on any trading floor'' that 
appear after the ROT category with ``including RSQTs and SQTs.'' \16\
---------------------------------------------------------------------------

    \16\ As a practical matter, the effect of including RSQTs in the 
ROT permit fee category should not increase overall costs to the 
RSQTs due to the fact that RSQTs receive a permit credit, which is 
applied against a member organization's RSQT fees. Specifically, 
pursuant to the Exchange's fee schedule, RSQTs are assessed an RSQT 
fee based on the number and type of option issues in which an RSQT 
is assigned. A credit is given to RSQTs based on the total number of 
permits held by the RSQT in a particular calendar month. For 
example, currently an RSQT may receive a monthly credit of $200 
(which is the same amount as the permit fee) because the permit 
holder qualifies a member organization as an order flow provider. 
Now, under this proposal, the RSQT will be charged a higher permit 
fee of $1,200, but receive a permit credit of $1,200 to be applied 
against the RSQT fee. See Securities Exchange Act Release No. 51428 
(March 24, 2005), 70 FR 16325 (March 30, 2005) (SR-Phlx-2005-12).
---------------------------------------------------------------------------

    In addition, although SQTs have a physical presence on the trading 
floor and are thus currently included in the ROT (on any trading floor) 
permit fee

[[Page 961]]

category, the Exchange proposes to specifically refer to SQTs on the 
fee schedule in order to help clarify that SQTs are also included in 
the ROT category.
2. Statutory Basis
    The Exchange believes that its proposal to amend its schedule of 
fees is consistent with Section 6(b) of the Act,\17\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act,\18\ in 
particular, in that it is an equitable allocation of reasonable fees 
among Exchange members.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78f(b).
    \18\ 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 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

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing proposed rule change has been designated as a fee 
change pursuant to Section 19(b)(3)(A)(ii) of the Act \19\ and Rule 
19b-4(f)(2) \20\ thereunder. Accordingly, the proposal will take effect 
upon filing with the Commission. At any time within 60 days of the 
filing of Amendment No. 1 to 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.\21\
---------------------------------------------------------------------------

    \19\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \20\ 17 CFR 240.19b-4(f)(2).
    \21\ See supra note 6.
---------------------------------------------------------------------------

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-Phlx-2005-72 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.

All submissions should refer to File Number SR-Phlx-2005-72. 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 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-Phlx-2005-72 and should be submitted on or before January 27, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\22\
---------------------------------------------------------------------------

    \22\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jonathan G. Katz,
Secretary.
[FR Doc. E6-21 Filed 1-5-06; 8:45 am]
BILLING CODE 8010-01-P

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.