Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to the Adoption of a Licensing Fee for Options on the Vanguard Dividend Appreciation VIPERs, 28717-28718 [E6-7461]

Download as PDF Federal Register / Vol. 71, No. 95 / Wednesday, May 17, 2006 / Notices at: http://www.nrc.gov/what-we-do/ policy-making/schedule.html. The NRC provides reasonable accommodation to individuals with disabilities where appropriate. If you need a reasonable accommodation to participate in these public meetings, or need this meeting notice or the transcript or other information from the public meetings in another format (e.g., braille, large print), please notify the NRC’s Disability Program Coordinator, Deborah Chan, at (301) 415–7041, TDD: (301) 415–2100, or by e-mail at DLC@brc.gov. Determinations on requests for reasonable accommodation will be made on a case-by-case basis. This notice is distributed by mail to several hundred subscribers; if you no longer wish to receive it, or would like to be added to the distribution, please contact the Office of the Secretary, Washington, DC 20555 (301) 415–1969. In addition, distribution of this meeting notice over the Internet system is available. If you are interested in receiving this Commission meeting schedule electronically, please send an electronic message to dkw@nrc.gov. Dated: May 11, 2006. R. Michelle Schroll, Office of the Secretary. [FR Doc. 06–4653 Filed 5–15–06; 11:54 am] BILLING CODE 7590–01–M SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53786; File No. SR–Amex– 2006–39] Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to the Adoption of a Licensing Fee for Options on the Vanguard Dividend Appreciation VIPERs mstockstill on PROD1PC61 with NOTICES May 11, 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 April 26, 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. On May 9, 2006, the Exchange submitted Amendment No. 1 to the proposed rule change, withdrew Amendment No. 1 to the proposed rule change and submitted Amendment No. 2 to the proposed rule change.3 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 4 and Rule 19b–4(f)(2) thereunder,5 which renders it effective upon filing with the Commission. 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 modify its Options Fee Schedule by adopting a per contract licensing fee for the orders of specialists, registered options traders (‘‘ROTs’’), firms, non-member market makers, and broker-dealers in connection with options transactions on the shares of the Vanguard Dividend Appreciation VIPERs (symbol: VIG). The text of the proposed rule change, as amended, is available on the Amex’s Web site at http://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 adopt a per contract licensing fee for options on VIG. This fee change will be assessed on members commencing April 27, 2006. The Exchange has entered into numerous agreements with various index providers for the purpose of trading options on certain exchange traded funds (‘‘ETFs’’), such as VIG. This requirement to pay an index license fee to a third party is a condition to the listing and trading of these ETF 3 See Partial Amendment No. 2. U.S.C. 78s(b)(3)(A)(ii). 5 17 CFR 240.19b–4(f)(2). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. VerDate Aug<31>2005 15:08 May 16, 2006 4 15 Jkt 208001 PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 28717 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 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 VIG. Specifically, Amex seeks to charge an options licensing fee of $0.10 per contract side for the VIG options 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 VIG 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 VIG 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 transactions in VIG 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 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) of the Act requires that the rules of a national securities exchange provide for the equitable allocation of reasonable dues, fees, and Continued E:\FR\FM\17MYN1.SGM 17MYN1 28718 Federal Register / Vol. 71, No. 95 / Wednesday, May 17, 2006 / Notices connection with the adoption of an options licensing fee for VIG 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. Accordingly, the Exchange seeks, through this proposal, to better align its transaction charges with the cost of providing products. 2. Statutory Basis Amex believes that the proposed rule change, as amended, is consistent with Section 6(b)(4) of the Act 9 regarding the equitable allocation of reasonable dues, fees and other charges among exchange members and other persons using exchange facilities. B. Self-Regulatory Organization’s Statement on Burden on Competition Amex believes that the proposed rule change, as amended, 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, as amended. 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 10 and Rule 19b–4(f)(2) thereunder,11 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. mstockstill on PROD1PC61 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, as amended, is consistent with the Act. Comments may be submitted by any of the following methods: SECURITIES AND EXCHANGE COMMISSION Electronic Comments [Release No. 34–53793; File No. SR–Amex– 2005–103] • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–Amex–2006–39 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–2006–39. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (http://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission’s Public Reference Room. Copies of 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 information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–Amex–2006–39 and should be submitted on or before June 7, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.12 Jill M. Peterson, Assistant Secretary. [FR Doc. E6–7461 Filed 5–16–06; 8:45 am] BILLING CODE 8010–01–P other charges among its members and issuers and other persons using its facilities. 9 15 U.S.C. 78f(b)(4). 10 15 U.S.C. 78s(b)(3)(A)(ii). 11 17 CFR 240.19b–4(f)(2). VerDate Aug<31>2005 15:08 May 16, 2006 Jkt 208001 12 17 PO 00000 CFR 200.30–3(a)(12). Frm 00064 Fmt 4703 Sfmt 4703 Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval of Proposed Rule Change and Amendment Nos. 1, 2, 3 and 4 Thereto Allowing Issuers of Listed Equity Securities, Structured Products, and Exchange Traded Funds a Right To Request a New Specialist May 11, 2006. On October 13, 2005, the American Stock Exchange LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend Amex Rule 27 to give issuers of listed equity securities and structured products, as well as sponsors of exchange traded funds (‘‘ETFs’’), a right to request a new specialist. On January 26, 2006, Amex filed Amendment No. 1 to the proposed rule change.3 On January 30, 2006, Amex filed Amendment No. 2 to the proposed rule change.4 On February 17, 2006, Amex filed Amendment No. 3 to the proposed rule change.5 On March 6, 2006, Amex filed Amendment No. 4 to the proposed rule change.6 The proposed rule change, as amended, was published for comment in the Federal Register on April 4, 2006.7 The Commission received no comments on the proposal. This order approves the proposed rule change, as amended. I. Description of the Proposal Amex Rule 27(e) currently gives the issuer of an equity security or a structured product and the sponsor of an ETF a one-time right to request a reallocation to a different specialist unit within twelve months after the listing of the security. 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 In Amendment No. 1, the Exchange proposed further changes to Amex Rule 27(e) and (f) and made revisions to the purpose section of the proposed rule change. 4 In Amendment No. 2, the Exchange made revisions to the purpose section of the proposed rule change to reflect changes to the text of Amex Rule 27(f) made in Amendment No. 1 5 In Amendment No. 3, the Exchange proposed further changes to Amex Rule 27(e) and (f) and made revisions to the purpose section of the proposed rule change. 6 In Amendment No. 4, the Exchange proposed minor technical changes to the text of Amex Rule 27(e) and (f). 7 See Securities Exchange Act Release No. 53561 (March 29, 2006), 71 FR 16841. 2 17 E:\FR\FM\17MYN1.SGM 17MYN1

Agencies

[Federal Register Volume 71, Number 95 (Wednesday, May 17, 2006)]
[Notices]
[Pages 28717-28718]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-7461]


=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53786; File No. SR-Amex-2006-39]


Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment Nos. 1 and 2 Thereto Relating to the Adoption of a 
Licensing Fee for Options on the Vanguard Dividend Appreciation VIPERs

May 11, 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 April 26, 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. On May 9, 2006, 
the Exchange submitted Amendment No. 1 to the proposed rule change, 
withdrew Amendment No. 1 to the proposed rule change and submitted 
Amendment No. 2 to the proposed rule change.\3\ 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 \4\ and Rule 19b-4(f)(2) thereunder,\5\ 
which renders it effective upon filing with the Commission. 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\ See Partial Amendment No. 2.
    \4\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \5\ 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 licensing fee for the orders of specialists, 
registered options traders (``ROTs''), firms, non-member market makers, 
and broker-dealers in connection with options transactions on the 
shares of the Vanguard Dividend Appreciation VIPERs (symbol: VIG).
    The text of the proposed rule change, as amended, is available on 
the Amex's Web site at http://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 adopt a per contract licensing fee for options on 
VIG. This fee change will be assessed on members commencing April 27, 
2006.
    The Exchange has entered into numerous agreements with various 
index providers for the purpose of trading options on certain exchange 
traded funds (``ETFs''), such as VIG. 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 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 VIG. Specifically, Amex seeks to charge 
an options licensing fee of $0.10 per contract side for the VIG options 
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 VIG 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 
VIG 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 transactions in VIG 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

[[Page 28718]]

connection with the adoption of an options licensing fee for VIG 
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. 
Accordingly, the Exchange seeks, through this proposal, to better align 
its transaction charges with the cost of providing products.
---------------------------------------------------------------------------

    \8\ Section 6(b)(4) of the Act requires 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.
---------------------------------------------------------------------------

2. Statutory Basis
    Amex believes that the proposed rule change, as amended, is 
consistent with Section 6(b)(4) of the Act \9\ regarding the equitable 
allocation of reasonable dues, fees and other charges among exchange 
members and other persons using exchange facilities.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    Amex believes that the proposed rule change, as amended, 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, as amended.

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 \10\ and Rule 19b-4(f)(2) thereunder,\11\ 
because it establishes or changes a due, fee, or other charge imposed 
by the self-regulatory organization.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \11\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    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, 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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-Amex-2006-39 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-2006-39. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of 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 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-Amex-2006-39 and should be submitted on or before June 
7, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
---------------------------------------------------------------------------

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

Jill M. Peterson,
Assistant Secretary.
[FR Doc. E6-7461 Filed 5-16-06; 8:45 am]
BILLING CODE 8010-01-P