Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Adoption of an Options Licensing Fee for Options on Certain SPDR ETFs, 9627-9629 [E6-2644]
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Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Notices
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 Exchange 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, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form at https://www.sec.gov/
rules/sro.shtml or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–Amex–2005–127 on the subject
line.
wwhite on PROD1PC65 with NOTICES
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File No.
SR–Amex–2005–127. 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 at 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 Exchange. All
VerDate Aug<31>2005
18:03 Feb 23, 2006
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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 No.
SR–Amex–2005–127 and should be
submitted on or before March 17, 2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.60
Nancy M. Morris,
Secretary.
[FR Doc. E6–2642 Filed 2–23–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–53328; File No. SR–Amex–
2006–11]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change Relating to
the Adoption of an Options Licensing
Fee for Options on Certain SPDR ETFs
February 16, 2006.
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 February
3, 2006, the American Stock Exchange
LLC (‘‘Amex’’ or ‘‘Exchange’’) submitted
to 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 Amex. Amex has
designated this proposal as one
establishing or changing a due, fee, or
other charge imposed by the selfregulatory organization under Section
19(b)(3)(A)(ii) of the Act 3 and Rule 19b–
4(f)(2) thereunder,4 which renders it
effective upon filing with the
Commission. 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 Exchange proposes to modify its
Options Fee Schedule by adopting a per
contract license fee for the orders of
specialists, registered options traders
(‘‘ROTs’’), firms, non-member market
makers, and broker-dealers in
60 17
CFR 200.30–3(a)(12).
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)(2).
9627
connection with options transactions in
three new exchange-traded funds
(‘‘ETFs’’): the SPDR Biotech ETF
(symbol: XBI); the SPDR Homebuilders
ETF (symbol: XHB); and the SPDR
Semiconductor ETF (symbol: XSD).
The text of the proposed rule change
is available on the Amex’s Web site at
https://www.amex.com, at the principal
office of the Amex, 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,
Amex 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. Amex 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
Amex proposes to to adopt a per
contract licensing fee for options on
XBI, XHB, and XSD. These fee changes
will be assessed on members
commencing February 6, 2006. Amex
also proposes to correct the Options Fee
Schedule to reflect the elimination of
the equity option fee discount for
member firms facilitation customer
orders.5
The Exchange has entered into
numerous agreements with various
index providers for the purpose of
trading options on certain ETFs. This
requirement to pay an index license fee
to a third party is a condition to the
listing and trading of these ETF options.
In many cases, the Exchange is required
to pay a significant licensing fee to the
index provider that may not be
reimbursed. In an effort to recoup the
costs associated with certain index
licenses, the Exchange has established a
per contract licensing fee for the orders
of specialists, ROTs, firms, non-member
market makers and broker-dealers,
which is collected on every option
transaction in designated products in
1 15
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Frm 00115
Fmt 4703
Sfmt 4703
5 See Securities Exchange Act Release No. 52754
(November 9, 2005), 70 FR 69998 (November 18,
2005) (File No. SR–Amex–2005–113).
E:\FR\FM\24FEN1.SGM
24FEN1
9628
Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Notices
wwhite on PROD1PC65 with NOTICES
which such market participant is a
party.6
The purpose of this proposal is to
charge an options licensing fee in
connection with options on XBI, XHB
and XSD (collectively, the ‘‘SPDR
ETFs’’). Specifically, Amex seeks to
charge an options licensing fee of $0.09
per contract side for each SPDR ETF
option for specialist, ROT, firm, nonmember market maker and broker-dealer
orders executed on the Exchange. In all
cases, the fees will be charged only to
the Exchange members through whom
the orders are placed.
The proposed options licensing fee
will allow the Exchange to recoup its
costs in connection with the index
license fee for the trading of the SPDR
ETF options. The fees will be collected
on every order of a specialist, ROT, firm,
non-member market maker, and brokerdealer executed on the Exchange. The
Exchange believes that the proposal to
require payment of a per contract
licensing fee in connection with the
SPDR ETF options by those market
participants that are the beneficiaries of
Exchange index license agreements is
justified and consistent with the rules of
the Exchange.
The Exchange notes that the Amex, in
recent years, has revised a number of
fees to better align Exchange fees with
the actual cost of delivering services and
reduce Exchange subsidies of such
services.7 Amex believes that the
implementation of this proposal is
consistent with the reduction and/or
elimination of these subsidies. Amex
believes that these fees will help to
allocate to those market participants
engaging in SPDR ETF options, a fair
share of the related costs of offering
such options.
The Exchange asserts that the
proposal is equitable as required by
Section 6(b)(4) of the Act.8 In
connection with the adoption of an
options licensing fee for SPDR ETF
options, the Exchange believes that
charging an options licensing fee, where
applicable, to all market participant
orders except for customer orders is
reasonable, given the competitive
pressures in the industry.9 Accordingly,
6 See, e.g., Securities Exchange Act Release No.
52493 (September 22, 2005), 70 FR 56941
(September 29, 2005).
7 See, e.g., Securities Exchange Act Release Nos.
45360 (January 29, 2002), 67 FR 5626 (February 6,
2002); and 44286 (May 9, 2001), 66 FR 27187 (May
16, 2001).
8 Section 6(b)(4) states that the rules of a national
securities exchange provide for the equitable
allocation of reasonable dues, fees, and other
charges among its members and issuers and other
persons using its facilities.
9 Telephone call between Jeffrey Burns, Vice
President and Associate General Counsel, Amex,
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18:03 Feb 23, 2006
Jkt 208001
the Exchange seeks, through this
proposal, to better align its transaction
charges with the cost of providing
products.
In addition, the Exchange recently
eliminated the equity options
transaction fee discount for member
firms facilitating customer orders.10
However, in a later filing, File No. SR–
Amex–2005–126,11 the Exchange
inadvertently failed to incorporate in
the Options Fee Schedule the
elimination of the equity option
transaction fee discount for members
firms; therefore, the current fee schedule
is inaccurate.12 Accordingly, in this
filing, the Exchange proposes to correct
the Options Fee Schedule to once again
reflect the elimination of the equity
option transaction fee discount for
member firms that was previously
adopted by the Exchange.
thereunder,15 because it establishes or
changes a due, fee, or other charge
imposed by the self-regulatory
organization.
At any time within 60 days of the
filing of such 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.
2. Statutory Basis
Amex believes that the proposed fee
change is consistent with Section 6(b)(4)
of the Act 13 regarding the equitable
allocation of reasonable dues, fees and
other charges among exchange members
and other persons using exchange
facilities.
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–Amex–2006–11 on the
subject line.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Amex believes that the proposed rule
change does not impose any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC,
20549–1090.
All submissions should refer to File
Number SR–Amex–2006–11. 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 Amex. All
comments received will be posted
without change; the Commission does
not edit personal identifying
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received from
Members, Participants or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change was filed
pursuant to Section 19(b)(3)(A)(ii) of the
Act 14 and Rule 19b–4(f)(2)
and Angela Muehr, Attorney, Division of Market
Regulation (‘‘Division’’), Commission, on February
15, 2006.
10 See Securities Exchange Act Release No. 52754,
supra note 5. This proposal was immediately
effective and was noticed in the Federal Register on
November 18, 2005.
11 See Securities Exchange Act Release No. 52925
(December 8, 2005), 70 FR 74065 (December 14,
2005).
12 Telephone call between Jeffrey Burns, Vice
President and Associate General Counsel, Amex,
and Angela Muehr, Attorney, Division of Market
Regulation (‘‘Division’’), Commission, on February
15, 2006.
13 15 U.S.C. 78f(b)(4).
14 15 U.S.C. 78s(b)(3)(A)(ii).
PO 00000
Frm 00116
Fmt 4703
Sfmt 4703
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:
15 17
E:\FR\FM\24FEN1.SGM
CFR 240.19b–4(f)(2).
24FEN1
Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Notices
information from submissions. You
should submit only information that
you wish to make available publicly. All
submissions should refer to File
Number SR–Amex–2006–11 and should
be submitted on or before March 17,
2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.16
Nancy M. Morris,
Secretary.
[FR Doc. E6–2644 Filed 2–23–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–53327; File No. SR–NYSE–
2005–86]
Self-Regulatory Organizations; New
York Stock Exchange, Inc.; Notice of
Filing of Proposed Rule Change and
Amendment No. 1 Thereto To Conform
NYSE Rules 123C and 476A with NYSE
Rule 80A
February 16, 2006.
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 December
7, 2005, the New York Stock Exchange,
Inc. (‘‘NYSE’’ or ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the Exchange.
On February 9, 2006, the Exchange filed
Amendment No. 1 to the proposed rule
change.3 The Commission is publishing
this notice to solicit comments on the
proposed rule change, as amended, from
interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend: (a)
NYSE Rule 123C (Market on the Close
Policy and Expiration Procedures); and
(b) the Supplementary Material to NYSE
Rule 476A (Imposition of Fines for
Minor Violation(s) of Rules), to conform
such rules with the current provisions
of NYSE Rule 80A (Index Arbitrage
Trading Restrictions). The text of the
proposed rule change is available on the
16 17
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 made minor
technical changes to the proposed rule text and
revised the description of the proposal to clarify the
general background of NYSE Rules 123C and 476A.
Amendment No. 1 replaced NYSE’s original filing
in its entirety.
wwhite on PROD1PC65 with NOTICES
1 15
VerDate Aug<31>2005
18:03 Feb 23, 2006
Jkt 208001
Exchange’s Internet Web site (https://
www.nyse.com), at the Exchange’s
principal office, and at the
Commission’s Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of, and basis for,
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
NYSE Rules 123C(7) and 476A to
conform these rules with the provisions
of NYSE Rule 80A. The Exchange
amended NYSE Rule 80A on two earlier
occasions to: (i) revise the trigger levels
for the ‘‘collar’’ provisions, among
others;4 and (ii) replace the usage of the
Dow Jones Industrial Average 5 (‘‘DJIA’’)
as the basis for the calculation of the
limitations on index arbitrage trading
with the average closing value of the
NYSE Composite Index (also referred
to as NYA).6 NYSE Rules 123C(7) and
476A refer to the former provisions of
NYSE Rule 80A and therefore must be
conformed with NYSE Rule 80A, as
amended.
NYSE Rule 80A currently requires
that, for any component stock of the
S&P 500 Stock Price Index,7 whenever
the NYSE Composite Index declines
from the previous day’s close by an
amount greater than or equal to two
percent calculated pursuant to NYSE
Rule 80A, all index arbitrage orders to
sell must be marked ‘‘sell plus,’’ and,
whenever the NYSE Composite Index
advances from the previous day’s close
by such amount, all index arbitrage
4 See
infra note 9.
Jones Industrial Average’’ is a service
mark of Dow Jones & Company, Inc.
6 See Securities Exchange Act Release No. 52328
(August 24, 2005), 70 FR 51398 (August 30, 2005)
(SR–NYSE–2005–45) (‘‘NYSE Rule 80A Order’’).
NYSE Rule 80A currently calculates limitations on
index arbitrage trading based on the NYSE
Composite Index, replacing the previous usage of
the DJIA with respect to such calculation.
7 ‘‘Standard and Poor’s 500 Stock Price Index is
a service mark of Standard and Poor’s Corporation.
5 ‘‘Dow
PO 00000
Frm 00117
Fmt 4703
Sfmt 4703
9629
orders to buy must be marked ‘‘buy
minus.’’ The value at which tick
restrictions are imposed is calculated
quarterly. The two-percent value is
based upon the average closing value of
the NYSE Composite Index for the last
month of the previous calendar quarter,
rounded down to the nearest ten points.
(a) NYSE Rule 123C(7) Expiration
Days: Exception to Rule 80A
NYSE Rule 123C(7) currently refers to
the former provisions of NYSE Rule
80A, which utilized the DJIA to
calculate the limitations on index
arbitrage trading. The Exchange
proposes to amend NYSE Rule 123C(7)
to reflect the current provisions of NYSE
Rule 80A, which applies the NYSE
Composite Index for such calculation.
NYSE Rule 123C(7) should have been
amended along with the amendments to
NYSE Rule 80A in August 2005,8 but
the Exchange inadvertently overlooked
the amendment at that time.
NYSE Rule 123C(7) currently
provides that when a market-on-close
(‘‘MOC’’) index arbitrage order to
establish or increase a position is
entered in any component stock of the
S&P 500 Stock Price Index and NYSE
Rule 80A subsequently goes into effect,
the MOC order must be handled
differently depending upon when NYSE
Rule 80A goes into effect. The tick
restrictions are determined at the time
NYSE Rule 80A goes into effect under
the various conditions that exist in the
market at that time. However, NYSE
Rule 123C(7) also indicates that NYSE
Rule 80A’s provisions, which relate to
the entry of index arbitrage orders when
the DJIA is up or down 2.0% from its
previous day’s closing value, do not
apply to index arbitrage MOC orders
‘‘that are liquidating previously
established stock positions against
expiring derivative index products.’’
The rule further provides that the two
percent value is calculated at the
beginning of each calendar quarter and
is 2.0%, rounded down to the nearest 10
points, of the average closing value of
the DJIA for the last month of the
previous quarter. Further, the rule states
that the NYSE Rule 80A exemption
applies only on expiration days.
Therefore, the orders that are entered
before NYSE Rule 80A goes into effect
cannot be cancelled between 3:40 p.m.
and 3:50 p.m., except to correct a
legitimate error or when a regulatory
trading halt is in effect; after 3:50 p.m.,
cancellation or reduction in the size of
MOC orders is not permitted for any
reason.
(b) NYSE Rule 476A Imposition of
Fines for Minor Violation(s) of Rules
8 See
E:\FR\FM\24FEN1.SGM
NYSE Rule 80A Order, supra note 6.
24FEN1
]]>Agencies
[Federal Register Volume 71, Number 37 (Friday, February 24, 2006)]
[Notices]
[Pages 9627-9629]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-2644]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-53328; File No. SR-Amex-2006-11]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to the Adoption of an Options Licensing Fee for Options on
Certain SPDR ETFs
February 16, 2006.
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 February 3, 2006, the American Stock Exchange LLC (``Amex'' or
``Exchange'') submitted to 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 Amex. Amex has
designated this proposal as one establishing or changing a due, fee, or
other charge imposed by the self-regulatory organization under Section
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\
which renders it effective upon filing with the Commission. 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)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to modify its Options Fee Schedule by
adopting a per contract license fee for the orders of specialists,
registered options traders (``ROTs''), firms, non-member market makers,
and broker-dealers in connection with options transactions in three new
exchange-traded funds (``ETFs''): the SPDR Biotech ETF (symbol: XBI);
the SPDR Homebuilders ETF (symbol: XHB); and the SPDR Semiconductor ETF
(symbol: XSD).
The text of the proposed rule change is available on the Amex's Web
site at https://www.amex.com, at the principal office of the Amex, 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, Amex 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. Amex 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
Amex proposes to to adopt a per contract licensing fee for options
on XBI, XHB, and XSD. These fee changes will be assessed on members
commencing February 6, 2006. Amex also proposes to correct the Options
Fee Schedule to reflect the elimination of the equity option fee
discount for member firms facilitation customer orders.\5\
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 52754 (November 9,
2005), 70 FR 69998 (November 18, 2005) (File No. SR-Amex-2005-113).
---------------------------------------------------------------------------
The Exchange has entered into numerous agreements with various
index providers for the purpose of trading options on certain ETFs.
This requirement to pay an index license fee to a third party is a
condition to the listing and trading of these ETF options. In many
cases, the Exchange is required to pay a significant licensing fee to
the index provider that may not be reimbursed. In an effort to recoup
the costs associated with certain index licenses, the Exchange has
established a per contract licensing fee for the orders of specialists,
ROTs, firms, non-member market makers and broker-dealers, which is
collected on every option transaction in designated products in
[[Page 9628]]
which such market participant is a party.\6\
---------------------------------------------------------------------------
\6\ See, e.g., Securities Exchange Act Release No. 52493
(September 22, 2005), 70 FR 56941 (September 29, 2005).
---------------------------------------------------------------------------
The purpose of this proposal is to charge an options licensing fee
in connection with options on XBI, XHB and XSD (collectively, the
``SPDR ETFs''). Specifically, Amex seeks to charge an options licensing
fee of $0.09 per contract side for each SPDR ETF option for specialist,
ROT, firm, non-member market maker and broker-dealer orders executed on
the Exchange. In all cases, the fees will be charged only to the
Exchange members through whom the orders are placed.
The proposed options licensing fee will allow the Exchange to
recoup its costs in connection with the index license fee for the
trading of the SPDR ETF options. The fees will be collected on every
order of a specialist, ROT, firm, non-member market maker, and broker-
dealer executed on the Exchange. The Exchange believes that the
proposal to require payment of a per contract licensing fee in
connection with the SPDR ETF options by those market participants that
are the beneficiaries of Exchange index license agreements is justified
and consistent with the rules of the Exchange.
The Exchange notes that the Amex, in recent years, has revised a
number of fees to better align Exchange fees with the actual cost of
delivering services and reduce Exchange subsidies of such services.\7\
Amex believes that the implementation of this proposal is consistent
with the reduction and/or elimination of these subsidies. Amex believes
that these fees will help to allocate to those market participants
engaging in SPDR ETF options, a fair share of the related costs of
offering such options.
---------------------------------------------------------------------------
\7\ See, e.g., Securities Exchange Act Release Nos. 45360
(January 29, 2002), 67 FR 5626 (February 6, 2002); and 44286 (May 9,
2001), 66 FR 27187 (May 16, 2001).
---------------------------------------------------------------------------
The Exchange asserts that the proposal is equitable as required by
Section 6(b)(4) of the Act.\8\ In connection with the adoption of an
options licensing fee for SPDR ETF options, the Exchange believes that
charging an options licensing fee, where applicable, to all market
participant orders except for customer orders is reasonable, given the
competitive pressures in the industry.\9\ Accordingly, the Exchange
seeks, through this proposal, to better align its transaction charges
with the cost of providing products.
---------------------------------------------------------------------------
\8\ Section 6(b)(4) states that the rules of a national
securities exchange provide for the equitable allocation of
reasonable dues, fees, and other charges among its members and
issuers and other persons using its facilities.
\9\ Telephone call between Jeffrey Burns, Vice President and
Associate General Counsel, Amex, and Angela Muehr, Attorney,
Division of Market Regulation (``Division''), Commission, on
February 15, 2006.
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In addition, the Exchange recently eliminated the equity options
transaction fee discount for member firms facilitating customer
orders.\10\ However, in a later filing, File No. SR-Amex-2005-126,\11\
the Exchange inadvertently failed to incorporate in the Options Fee
Schedule the elimination of the equity option transaction fee discount
for members firms; therefore, the current fee schedule is
inaccurate.\12\ Accordingly, in this filing, the Exchange proposes to
correct the Options Fee Schedule to once again reflect the elimination
of the equity option transaction fee discount for member firms that was
previously adopted by the Exchange.
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\10\ See Securities Exchange Act Release No. 52754, supra note
5. This proposal was immediately effective and was noticed in the
Federal Register on November 18, 2005.
\11\ See Securities Exchange Act Release No. 52925 (December 8,
2005), 70 FR 74065 (December 14, 2005).
\12\ Telephone call between Jeffrey Burns, Vice President and
Associate General Counsel, Amex, and Angela Muehr, Attorney,
Division of Market Regulation (``Division''), Commission, on
February 15, 2006.
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2. Statutory Basis
Amex believes that the proposed fee change is consistent with
Section 6(b)(4) of the Act \13\ regarding the equitable allocation of
reasonable dues, fees and other charges among exchange members and
other persons using exchange facilities.
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\13\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
Amex believes that the proposed rule change does not impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received from Members, Participants or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change was filed pursuant to Section
19(b)(3)(A)(ii) of the Act \14\ and Rule 19b-4(f)(2) thereunder,\15\
because it establishes or changes a due, fee, or other charge imposed
by the self-regulatory organization.
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\14\ 15 U.S.C. 78s(b)(3)(A)(ii).
\15\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of such 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 rule-comments@sec.gov. Please include
File Number SR-Amex-2006-11 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC, 20549-1090.
All submissions should refer to File Number SR-Amex-2006-11. 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 Amex. All comments received will be posted
without change; the Commission does not edit personal identifying
[[Page 9629]]
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-Amex-2006-11 and should be submitted on or before March
17, 2006.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-2644 Filed 2-23-06; 8:45 am]
BILLING CODE 8010-01-P
