Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Waive Initial Listing Fee and One-Time Special Charge in Connection With Listing New Class of Common Shares Payable by Any Company Listed on Another National Securities Exchange That Transfers the Listing of Its Primary Class of Common Shares to the NYSE, 71219-71221 [E6-20885]
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Federal Register / Vol. 71, No. 236 / Friday, December 8, 2006 / Notices
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:
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.15
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6–20874 Filed 12–7–06; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54849; File No. SR–NYSE–
2006–104]
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–NYSE–2006–105 on the subject
line.
Paper Comments
sroberts on PROD1PC70 with NOTICES
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Waive Initial
Listing Fee and One-Time Special
Charge in Connection With Listing
New Class of Common Shares Payable
by Any Company Listed on Another
National Securities Exchange That
Transfers the Listing of Its Primary
Class of Common Shares to the NYSE
November 30, 2006.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on November
All submissions should refer to File
29, 2006, The New York Stock Exchange
Number SR–NYSE–2006–105. This file
LLC (‘‘Exchange’’ or ‘‘NYSE’’) filed with
number should be included on the
the Securities and Exchange
subject line if e-mail is used. To help the Commission (‘‘Commission’’) the
Commission process and review your
proposed rule change as described in
comments more efficiently, please use
Items I and II below, which Items have
only one method. The Commission will been prepared substantially by NYSE.
post all comments on the Commissions
The Exchange filed the proposal as a
Internet Web site (https://www.sec.gov/
‘‘non-controversial’’ proposed rule
rules/sro.shtml). Copies of the
change pursuant to Section 19(b)(3)(A)
submission, all subsequent
of the Act,3 and Rule 19b–4(f)(6)
amendments, all written statements
thereunder,4 which renders the proposal
with respect to the proposed rule
effective upon filing with the
change that are filed with the
Commission.5 The Commission is
Commission, and all written
publishing this notice to solicit
communications relating to the
comments on the proposed rule change
proposed rule change between the
from interested persons.
Commission and any person, other than
I. Self-Regulatory Organization’s
those that may be withheld from the
Statement of the Terms of Substance of
public in accordance with the
the Proposed Rule Change
provisions of 5 U.S.C. 552, will be
NYSE proposes to amend Section
available for inspection and copying in
902.03 of its Listed Company Manual to
the Commission’s Public Reference
Room. Copies of such filing also will be provide that there shall be no initial
listing fee payable by any company
available for inspection and copying at
the principal office of the Exchange. All listed on another national securities
exchange that transfers the listing of its
comments received will be posted
without change; the Commission does
1 15 U.S.C. 78s(b)(1).
not edit personal identifying
2 17 CFR 240.19b–4.
information from submissions. You
3 15 U.S.C. 78s(b)(3)(A).
should submit only information that
4 17 CFR 240.19b–4(f)(6).
you wish to make available publicly. All
5 NYSE gave the Commission written notice of its
submissions should refer to File
intention to file the proposed rule change on
Number SR–NYSE–2006–105 and
November 29, 2006. The Commission reviewed the
proposed rule change and gave NYSE permission to
should be submitted on or before
file the proposed rule change on the same day.
December 29, 2006.
15 17
NYSE has asked the Commission to waive the 30day operative delay. See Rule 19b–4(f)(6)(iii). 17
CFR 240.19b–4(f)(6)(iii).
CFR 200.30–3(a)(12).
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19:05 Dec 07, 2006
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PO 00000
Frm 00100
Fmt 4703
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71219
primary class of common shares to the
Exchange. The Exchange will eliminate
initial listing fees for issuers listed on
other national securities exchanges that
transfer their listing to the Exchange on
or after November 29, 2006. In addition,
the Exchange will waive with respect to
such issuers the special one-time charge
of $37,500 payable in connection with
the initial listing of any class of
common shares. The text of the
proposed rule change is available at
www.nyse.com, at the NYSE, 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,
NYSE 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. NYSE 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
NYSE proposes to amend Section
902.03 of its Listed Company Manual to
provide that there shall be no initial
listing fee payable by any company
listed on another national securities
exchange that transfers the listing of its
primary class of common shares to the
Exchange. NYSE will eliminate entry
and application fees for exchange
issuers that transfer their listing to the
Exchange on or after November 29,
2006. In addition, the Exchange will
waive with respect to such issuers the
special one-time charge of $37,500
payable in connection with the initial
listing of any class of common shares.
For issuers that have paid these fees, the
Exchange will refund the money.
Companies transferring from other
national securities exchanges will still
be required to pay the annual listing fee
payable by all companies, prorated for
the first portion of a calendar year after
the listing date.
Companies transferring from other
national securities exchanges will be
subject to the same level of annual fees
and listing of additional shares fees as
other NYSE issuers. The proposed rule
change will not affect the Exchange’s
commitment of resources to its
regulatory oversight of the listing
E:\FR\FM\08DEN1.SGM
08DEN1
sroberts on PROD1PC70 with NOTICES
71220
Federal Register / Vol. 71, No. 236 / Friday, December 8, 2006 / Notices
process or its regulatory programs.
Specifically, companies that switch
their listing will be reviewed for
compliance with Exchange listing
standards in the same manner as any
other company that applies to be listed
on the Exchange. The Exchange will
conduct a full and independent review
of each issuer’s compliance with the
Exchange’s listing standards.
The Exchange believes that the
elimination of such fees is justified on
several grounds. An issuer that already
paid initial listing fees to an exchange
when it became a publicly traded
company is reluctant to pay a second
initial listing fee to another listing
venue, even if it concludes that the
Exchange offers the issuer and its
investors superior services and market
quality. Even if an issuer concludes that
the Exchange would provide a superior
market for its stock, the benefits of the
switch must currently be weighed
against the cost of initial inclusion,
which can be as much as $250,000.
Since the expected benefits of the
switch would be diffused among the
issuers’ investors and realized over
time, but the initial listing fees must be
paid by the issuer immediately, the
Exchange is concerned that issuers that
stand to benefit may nevertheless opt to
forgo a switch. As such, the Exchange
believes that assessing the initial fees
against issuers that have already paid
fees to list on another market imposes
a burden on the competition between
exchange markets and markets other
than exchange markets, a competition
that the Exchange believes is one of the
central goals of the national market
system. This concern is particularly
great in light of the fact that the
Commission has approved the waiver of
initial listing fees by Nasdaq with
respect to companies transferring from
other national securities exchanges.6
The Exchange understands that the
effect of this proposed rule change will
be to impose a lower level of listing fees
on switching issuers than on some other
issuers. In light of the fact that the
Exchange will collect the same level of
annual fees and listing of additional
shares fees from such issuers, however,
the Exchange believes that the
difference does not constitute an
inequitable allocation of fees. In light of
a switching issuer’s prior payment to
another market, the Exchange believes
that eliminating initial fees for
switching issuers is entirely consistent
6 See Securities Exchange Act Release Nos. 50740
(November 29, 2004), 69 FR 70299 (December 3,
2004) (SR–NASD–2004–140) (notice) and 51004
(January 10, 2005), 70 FR 2917 (January 18, 2005)
(approval order).
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19:05 Dec 07, 2006
Jkt 211001
with an equitable allocation of listing
fees.
The Exchange does not expect the
financial impact of this proposed rule
change to be material, either in terms of
increased levels of annual fees from
switching issuers or in terms of
diminished entry fees. Quite simply,
even with the proposed rule change in
place, the Exchange understands that a
change in listing venue is a major step
for an issuer, and therefore the
Exchange does not expect that the
number of switching issuers in a given
time frame will be sufficient to have a
material effect on financial resources.
Accordingly, the proposed rule change
will not impact the Exchange’s resource
commitment to its regulatory oversight
of the listing process or its regulatory
programs.
2. Statutory Basis
NYSE believes the proposed rule
change is consistent with the
requirement under Section 6(b)(4) 7 of
the Act that an exchange have rules that
provide for the equitable allocation of
reasonable dues, fees and other charges
among its members and other persons
using its facilities, and the requirement
under Section 6(b)(5) 8 of the Act that an
exchange have rules that are designed to
remove impediments to and perfect the
mechanism of a free and open market
and a national market system and are
not designed to permit unfair
discrimination between issuers. In light
of a switching issuer’s prior payment to
another market, the Exchange believes
that the proposed fee waiver does not
render the allocation of its listing fees
inequitable or unfairly discriminatory
because the Exchange expects that, on
average, the review of companies
transferring from other national
securities exchanges to the Exchange
will be less costly than the review of a
previously unlisted company, as the
issuer will have previously been subject
to corporate governance requirements
very similar to those of the Exchange.
The Exchange believes that the fee
waiver will make it easier for companies
to transfer among national securities
exchanges and will remove a
competitive disadvantage the Exchange
currently has vis a vis Nasdaq and is
therefore designed to perfect the
mechanism of a free and open market.
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
7 15
8 15
PO 00000
U.S.C. 78f(b)(4).
U.S.C. 78f(b)(5).
Frm 00101
Fmt 4703
Sfmt 4703
necessary or appropriate in furtherance
of the purpose of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
The Exchange has 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 foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 9 and Rule 19b–4(f)(6)
thereunder.10
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.
NYSE has asked that the Commission
waive the 30-day operative delay
contained in Rule 19b–4(f)(6)(iii) under
the Act.11 Because waiver of these fees
will enable NYSE to compete for listings
with Nasdaq, the Commission believes
waiver of the 30-day operative delay is
consistent with the protection of
investors and the public interest.
Accordingly, the Commission
designates the proposal to be effective
and operative upon filing with the
Commission.12
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:
9 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
11 17 CFR 240.19b–4(f)(6)(iii).
12 For purposes only of waiving the 30-day
operative delay of this proposal, the Commission
has considered the proposed rule’s impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
10 17
E:\FR\FM\08DEN1.SGM
08DEN1
Federal Register / Vol. 71, No. 236 / Friday, December 8, 2006 / Notices
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–NYSE–2006–104 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54860; File No. SR NYSE–
2006–76]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Order Granting Accelerated
Approval to Proposed Rule Change, as
Amended, Relating to Exchange Rule
104.10 (‘‘Dealings by Specialists’’)
December 1, 2006.
I. Introduction
On September 22, 2006, the New York
Stock Exchange LLC (‘‘NYSE’’ or
‘‘Exchange’’) filed with the Securities
All submissions should refer to File
and Exchange Commission
Number SR–NYSE–2006–104. This file
(‘‘Commission’’), pursuant to Section
number should be included on the
19(b)(1) of the Securities Exchange Act
subject line if e-mail is used. To help the of 1934 (‘‘Act’’) 1 and Rule 19b–4
Commission process and review your
thereunder,2 a proposed rule change to
comments more efficiently, please use
amend specialist stabilization
only one method. The Commission will requirements set forth in NYSE Rule
post all comments on the Commission’s 104.10 (‘‘Dealings by Specialists’’). The
proposed rule change was published for
Internet Web site (https://www.sec.gov/
comment in the Federal Register on
rules/sro.shtml). Copies of the
September 28, 2006.3 The Commission
submission, all subsequent
received five comment letters 4 from one
amendments, all written statements
commenter and two comment response
with respect to the proposed rule
letters from NYSE.5 On October 25,
change that are filed with the
2006, NYSE filed Amendment No. 1 to
Commission, and all written
the proposed rule change.6 This notice
communications relating to the
and order approves the proposed rule
proposed rule change between the
change, as modified by Amendment No.
Commission and any person, other than
1, on an accelerated basis.7
those that may be withheld from the
II. Description of the Proposal
public in accordance with the
provisions of 5 U.S.C. 552, will be
NYSE Rule 104 governs specialist
available for inspection and copying in
dealings and includes, among other
the Commission’s Public Reference
things, restrictions upon specialists’
Room. Copies of such filing also will be ability to trade as a dealer in the stocks
available for inspection and copying at
in which he or she is registered. Under
the principal office of NYSE. All
NYSE Rule 104(a), specialists are not
permitted to effect transactions on the
comments received will be posted
Exchange for their proprietary accounts
without change; the Commission does
in any security in which the specialist
not edit personal identifying
information from submissions. You
1 15 U.S.C. 78s(b)(1).
should submit only information that
2 17 CFR 240.19b–4.
you wish to make available publicly. All
3 See Securities Exchange Act Release No. 54504
submissions should refer to File
(September 26, 2006), 71 FR 57011 (‘‘Stabilization
Number SR–NYSE–2006–104 and
Proposal’’).
4 See letters from George Rutherfurd to the
should be submitted on or before
Commission, dated October 11, 2006 (‘‘Rutherfurd
December 29, 2006.
sroberts on PROD1PC70 with NOTICES
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.13
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6–20885 Filed 12–7–06; 8:45 am]
BILLING CODE 8011–01–P
13 17
CFR 200.30–3(a)(12).
VerDate Aug<31>2005
19:05 Dec 07, 2006
Jkt 211001
Letter I’’); October 20, 2006 (‘‘Rutherfurd Letter II’’);
October 26, 2006 (‘‘Rutherfurd Letter III’’);
November 2, 2006 (‘‘Rutherfurd Letter IV’’); and
November 14, 2006 (‘‘Rutherfurd Letter V’’).
5 See letters from Mary Yeager, Assistant
Secretary, NYSE, to Nancy M. Morris, Secretary,
Commission, dated November 6, 2006 (‘‘NYSE
Letter I’’) and November 29, 2006 (‘‘NYSE Letter
II’’).
6 For a description of Amendment No. 1, see
Section II.D., infra.
7 The proposed rule change, as amended by
Amendment No. 1, was approved on a temporary,
pilot basis in File No. SR–NYSE–2006–82. See
Securities Exchange Release No. 54578 (October 5,
2006), 71 FR 60216 (October 12, 2006) (‘‘Phase 3
Pilot’’).
PO 00000
Frm 00102
Fmt 4703
Sfmt 4703
71221
is registered, ‘‘unless such dealings are
reasonably necessary to permit such
specialist to maintain a fair and orderly
market * * *’’ This restriction is known
as the ‘‘negative obligation.’’ In
particular, NYSE Rules 104.10(5) and (6)
expand upon the negative obligation
with regard to specific types of
proprietary transactions. These sections
further define the instances when a
specialist is restricted in his or her
ability to trade in relation to the
direction of the market.
A. Current Specialist Stabilization Rules
Specifically, current NYSE Rule
104.10(5)(i) provides that specialist
proprietary transactions are to be
effected in a reasonable and orderly
manner in relation to the general
market, the market in a particular stock,
and the adequacy of the specialist’s
position to the immediate and
reasonably anticipated needs of the
market. The rule further provides that,
unless it is to render the specialist’s
position in a stock adequate for current
or reasonably anticipated needs of the
market, a specialist should not effect a
non-stabilizing transaction (i.e., a
transaction with the trend of price
movement) for the specialist’s account
when acquiring or increasing a position.
In this regard, the rule restricts
specialists from purchasing stock at a
price above the last sale (in the same
trading session) and purchasing more
than 50% of the stock offered on a ‘‘zero
plus tick,’’ i.e., at the same price as the
last sale, when such last sale price was
higher than the previous, differently
priced sale in the stock on the
Exchange. Specialists are, however,
permitted to effect these types of
transactions with Floor Official
approval or in less active markets where
such transactions are an essential part of
a proper course of dealings and where
the amount of stock involved and the
price change, if any, are normal in
relation to the market.
NYSE Rule 104.10(6) sets forth the
specialist’s stabilization requirements
when liquidating or reducing a position.
This rule provides that such trades
should be effected in a reasonable and
orderly manner in relation to the
condition of the general market, the
market in the particular security, and
the adequacy of the specialist’s position
to meet the immediate and anticipated
needs of the market in the security.
Specialists are permitted to liquidate or
reduce a position by selling stock on a
‘‘direct minus tick,’’ i.e., selling stock at
a price lower than the price of the last
sale on the Exchange, or by purchasing
stock on a ‘‘direct plus tick,’’ i.e., at a
price higher than the price of the last
E:\FR\FM\08DEN1.SGM
08DEN1
]]>Agencies
[Federal Register Volume 71, Number 236 (Friday, December 8, 2006)]
[Notices]
[Pages 71219-71221]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-20885]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54849; File No. SR-NYSE-2006-104]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Waive Initial Listing Fee and One-Time Special Charge in Connection
With Listing New Class of Common Shares Payable by Any Company Listed
on Another National Securities Exchange That Transfers the Listing of
Its Primary Class of Common Shares to the NYSE
November 30, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 29, 2006, The New York Stock Exchange LLC
(``Exchange'' or ``NYSE'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared substantially by
NYSE. The Exchange filed the proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A) of the Act,\3\ and
Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective
upon filing with the Commission.\5\ The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6).
\5\ NYSE gave the Commission written notice of its intention to
file the proposed rule change on November 29, 2006. The Commission
reviewed the proposed rule change and gave NYSE permission to file
the proposed rule change on the same day. NYSE has asked the
Commission to waive the 30-day operative delay. See Rule 19b-
4(f)(6)(iii). 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
NYSE proposes to amend Section 902.03 of its Listed Company Manual
to provide that there shall be no initial listing fee payable by any
company listed on another national securities exchange that transfers
the listing of its primary class of common shares to the Exchange. The
Exchange will eliminate initial listing fees for issuers listed on
other national securities exchanges that transfer their listing to the
Exchange on or after November 29, 2006. In addition, the Exchange will
waive with respect to such issuers the special one-time charge of
$37,500 payable in connection with the initial listing of any class of
common shares. The text of the proposed rule change is available at
www.nyse.com, at the NYSE, 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, NYSE 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. NYSE 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
NYSE proposes to amend Section 902.03 of its Listed Company Manual
to provide that there shall be no initial listing fee payable by any
company listed on another national securities exchange that transfers
the listing of its primary class of common shares to the Exchange. NYSE
will eliminate entry and application fees for exchange issuers that
transfer their listing to the Exchange on or after November 29, 2006.
In addition, the Exchange will waive with respect to such issuers the
special one-time charge of $37,500 payable in connection with the
initial listing of any class of common shares. For issuers that have
paid these fees, the Exchange will refund the money. Companies
transferring from other national securities exchanges will still be
required to pay the annual listing fee payable by all companies,
prorated for the first portion of a calendar year after the listing
date.
Companies transferring from other national securities exchanges
will be subject to the same level of annual fees and listing of
additional shares fees as other NYSE issuers. The proposed rule change
will not affect the Exchange's commitment of resources to its
regulatory oversight of the listing
[[Page 71220]]
process or its regulatory programs. Specifically, companies that switch
their listing will be reviewed for compliance with Exchange listing
standards in the same manner as any other company that applies to be
listed on the Exchange. The Exchange will conduct a full and
independent review of each issuer's compliance with the Exchange's
listing standards.
The Exchange believes that the elimination of such fees is
justified on several grounds. An issuer that already paid initial
listing fees to an exchange when it became a publicly traded company is
reluctant to pay a second initial listing fee to another listing venue,
even if it concludes that the Exchange offers the issuer and its
investors superior services and market quality. Even if an issuer
concludes that the Exchange would provide a superior market for its
stock, the benefits of the switch must currently be weighed against the
cost of initial inclusion, which can be as much as $250,000. Since the
expected benefits of the switch would be diffused among the issuers'
investors and realized over time, but the initial listing fees must be
paid by the issuer immediately, the Exchange is concerned that issuers
that stand to benefit may nevertheless opt to forgo a switch. As such,
the Exchange believes that assessing the initial fees against issuers
that have already paid fees to list on another market imposes a burden
on the competition between exchange markets and markets other than
exchange markets, a competition that the Exchange believes is one of
the central goals of the national market system. This concern is
particularly great in light of the fact that the Commission has
approved the waiver of initial listing fees by Nasdaq with respect to
companies transferring from other national securities exchanges.\6\
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release Nos. 50740 (November 29,
2004), 69 FR 70299 (December 3, 2004) (SR-NASD-2004-140) (notice)
and 51004 (January 10, 2005), 70 FR 2917 (January 18, 2005)
(approval order).
---------------------------------------------------------------------------
The Exchange understands that the effect of this proposed rule
change will be to impose a lower level of listing fees on switching
issuers than on some other issuers. In light of the fact that the
Exchange will collect the same level of annual fees and listing of
additional shares fees from such issuers, however, the Exchange
believes that the difference does not constitute an inequitable
allocation of fees. In light of a switching issuer's prior payment to
another market, the Exchange believes that eliminating initial fees for
switching issuers is entirely consistent with an equitable allocation
of listing fees.
The Exchange does not expect the financial impact of this proposed
rule change to be material, either in terms of increased levels of
annual fees from switching issuers or in terms of diminished entry
fees. Quite simply, even with the proposed rule change in place, the
Exchange understands that a change in listing venue is a major step for
an issuer, and therefore the Exchange does not expect that the number
of switching issuers in a given time frame will be sufficient to have a
material effect on financial resources. Accordingly, the proposed rule
change will not impact the Exchange's resource commitment to its
regulatory oversight of the listing process or its regulatory programs.
2. Statutory Basis
NYSE believes the proposed rule change is consistent with the
requirement under Section 6(b)(4) \7\ of the Act that an exchange have
rules that provide for the equitable allocation of reasonable dues,
fees and other charges among its members and other persons using its
facilities, and the requirement under Section 6(b)(5) \8\ of the Act
that an exchange have rules that are designed to remove impediments to
and perfect the mechanism of a free and open market and a national
market system and are not designed to permit unfair discrimination
between issuers. In light of a switching issuer's prior payment to
another market, the Exchange believes that the proposed fee waiver does
not render the allocation of its listing fees inequitable or unfairly
discriminatory because the Exchange expects that, on average, the
review of companies transferring from other national securities
exchanges to the Exchange will be less costly than the review of a
previously unlisted company, as the issuer will have previously been
subject to corporate governance requirements very similar to those of
the Exchange. The Exchange believes that the fee waiver will make it
easier for companies to transfer among national securities exchanges
and will remove a competitive disadvantage the Exchange currently has
vis a vis Nasdaq and is therefore designed to perfect the mechanism of
a free and open market.
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\7\ 15 U.S.C. 78f(b)(4).
\8\ 15 U.S.C. 78f(b)(5).
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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 purpose of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The Exchange has 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 foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate if consistent with
the protection of investors and the public interest, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\9\ and Rule 19b-4(f)(6) thereunder.\10\
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
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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.
NYSE has asked that the Commission waive the 30-day operative delay
contained in Rule 19b-4(f)(6)(iii) under the Act.\11\ Because waiver of
these fees will enable NYSE to compete for listings with Nasdaq, the
Commission believes waiver of the 30-day operative delay is consistent
with the protection of investors and the public interest. Accordingly,
the Commission designates the proposal to be effective and operative
upon filing with the Commission.\12\
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\11\ 17 CFR 240.19b-4(f)(6)(iii).
\12\ For purposes only of waiving the 30-day operative delay of
this proposal, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. 15 U.S.C.
78c(f).
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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:
[[Page 71221]]
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-NYSE-2006-104 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSE-2006-104. 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 NYSE. 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-NYSE-2006-104 and should be submitted on or before December 29,
2006.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6-20885 Filed 12-7-06; 8:45 am]
BILLING CODE 8011-01-P
