Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to Listing and Annual Fees for Derivative Securities Products and Closed-End Funds, 27160-27164 [E7-9177]
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27160
Federal Register / Vol. 72, No. 92 / Monday, May 14, 2007 / Notices
among its members and other persons
using its facilities.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
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
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change
has become effective upon filing with
the Commission pursuant to Section
19(b)(3)(A)(ii) of the Act 7 and Rule 19b–
4(f)(2) thereunder,8 in that the proposed
rule change establishes or changes a
member due, fee, or other charge
imposed by the self-regulatory
organization. At any time within 60
days of the filing of the proposed rule
change, the Commission may summarily
abrogate such rule change if it appears
to the Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
IV. Solicitation of Comments
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.9
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–9178 Filed 5–11–07; 8:45 am]
BILLING CODE 8010–01–P
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–ISE–2007–24 on the subject
line.
Paper Comments
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All submissions should refer to File
Number SR–ISE–2007–24. 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 ISE. 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–ISE–2007–24 and should be
submitted on or before June 4, 2007.
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–55720; File No. SR–
NYSEArca–2007–22]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing of Proposed
Rule Change and Amendment Nos. 1
and 2 Thereto Relating to Listing and
Annual Fees for Derivative Securities
Products and Closed-End Funds
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
27, 2007, NYSE Arca, Inc. (‘‘NYSE
Arca’’ or the ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) the proposed rule
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
U.S.C. 78s(b)(3)(A)(ii).
8 17 CFR 240.19, 240.19b–4(f)(2).
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19:49 May 11, 2007
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
NYSE Arca, through its wholly owned
subsidiary NYSE Arca Equities, Inc.
(‘‘NYSE Arca Equities’’), is proposing to
amend its Schedule of Fees and Charges
(‘‘Fee Schedule’’) to revise the listing
fees applicable to Derivative Securities
Products, Closed-End Funds and
Structured Products listed on NYSE
Arca, L.L.C. (‘‘NYSE Arca
Marketplace’’), the equities facility of
NYSE Arca Equities. The Exchange also
proposes related modifications to the
Fee Schedule. The text of the proposed
rule change is available at NYSE Arca,
the Commission’s Public Reference
Room, and https://www.nysearca.com.
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 Arca 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
Arca 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
May 7, 2007.
9 17
7 15
change as described in Items I, II, and
III below, which Items have been
substantially prepared by NYSE Arca.
On May 1, 2007, NYSEArca filed
Amendment No. 1 to the proposed rule
change.3 On May 3, 2007, NYSEArca
filed Amendment No. 2 to the proposed
rule change.4 The Commission is
publishing this notice to solicit
comments on the proposed rule change,
as amended, from interested persons.
Fmt 4703
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NYSE Arca has determined to revise
the listing fees specifically applicable to
Derivative Securities Products (or
3 Amendment No. 1 replaces and supersedes the
original filing in its entirety.
4 Amendment No. 2 conforms a single category in
the annual fee chart for Derivative Securities
Products in the purpose section with the Fee
Schedule; and amends the purpose section to reflect
that an additional issuer listed a series of
Investment Company Units on the Exchange on
March 28, 2007.
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27161
‘‘Products’’), Closed-End Funds and
Structured Products,5 as follows:
(1) Eliminate the Application
Processing Fee for Derivative Securities
Products, Closed-End Funds and
Structured Products;
(2) Impose an original listing fee of
$5,000 per Derivative Securities
Product;
(3) Reduce, for some Derivative
Securities Products, the Annual Fee;
and
(4) Establish a listing and annual fee
schedule for Closed-End Funds based
on New York Stock Exchange LLC
(‘‘NYSE’’) fees for Closed-End Funds as
set forth in Section 902.04 of the NYSE
Listed Company Manual.
This filing also proposes a number of
related modifications to the Fee
Schedule. The proposed revisions will
apply as of January 1, 2007 (with the
exception of listing fees for Closed-End
Funds).
a Listing Fee for subsequent additional
listings of Funds from the same Fund
issuer or ‘‘family,’’ regardless of whether
one or more previously listed Funds
remains listed on NYSE Arca.6 Further,
this Listing Fee applies regardless of
whether the Fund(s) lists in conjunction
with an initial public offering, transfers
from another marketplace, or
concurrently lists or is already listed on
another exchange or market.
Summary of Current and Proposed Fees
(2) Limitations on Closed-End Fund
Listing Fees
Fund Family Discount. If two or more
b. Closed-End Funds 7
closed-end funds from the same fund
When a Closed-End Fund lists a class family list at approximately the same
time, the Exchange will cap the
of common stock, or first lists a class of
preferred stock in a case where common collective Listing Fee for those funds at
$75,000. The Exchange will consider
stock is not already listed, NYSE Arca
funds from the same fund family to be
Equities proposes Listing Fees as
listing at approximately the same time
follows:
if an issuer provides notice that such
Total listing funds will be listed as part of the same
Number of securities issued
fee
transaction. A fund family consists of
closed-end funds with a common
Up to and including 10 million ..
$20,000
investment adviser or investment
Over 10 million up to and including 20 million ..................
30,000 advisers who are ‘‘affiliated persons’’ as
Over 20 million .........................
40,000 defined in Section 2(a)(3) of the
Investment Company Act of 1940, as
amended.
(1) Listing Additional Securities by a
Limitation on Listing Fees for
Closed-End Fund
Additional Class of Common Shares. A
In the case of the following types of
Closed-End Fund that applies to list a
additional listings, Listing Fees are
new class of common shares in addition
calculated on a per share basis for each
to its primary class will be charged a
class according to the Listing Fee
fixed Listing Fee of $5,000 in lieu of the
schedule below:
per share schedule.
• At the time it first lists, a ClosedMinimum Listing Fee for Subsequent
End Fund lists one or more classes of
Listing of Additional Securities. NYSE
preferred stock or warrants in addition
Arca will impose a minimum
to a primary class of common stock or
application fee for a subsequent listing
preferred stock;
of additional securities of $2,500. When
• Once listed, a Closed-End Fund
listing additional securities, an issuer is
lists additional shares of a class of
billed Listing Fees in an amount equal
previously listed securities; or
to the greater of the $2,500 minimum
• Once listed, a Closed-End Fund
supplemental listing application fee and
lists a new class of preferred stock or
the fee calculated on a per share basis.
warrants.
This applies to the listing of additional
shares of an already listed equity
6 Footnote 1 to the Exchange’s current Fee
security or to the listing of an additional
Schedule states that Fund ‘‘families’’ are those with
a common investment advisor or investment
class of equity security (other than a
advisors, which are ‘‘affiliated persons’’ as defined
new class of common shares).
in the securities laws.
Fee for Certain Changes. NYSE Arca
7 These fees are substantially identical to the fees
will charge a $2,500 fee for changes that
charged by the NYSE for Closed-End Funds. See
involve modifications to Exchange
NYSE Listed Company Manual, Section 902.04.
1. Application Processing Fee
Currently, NYSE Arca levies a nonrefundable application processing fee of
$500 for all applications to list ‘‘Funds’’
(which term currently encompasses
Exchange-Traded Funds and ClosedEnd Funds) submitted at the same time
by a Fund issuer or ‘‘family’’ regardless
of the number of Funds to be listed.
This fee is currently credited towards
the applicable initial Listing Fee if the
application is approved, or if the Fund
issuer or ‘‘family’’ is not subject to an
initial Listing Fee, towards the
applicable Annual Fee. With this filing,
NYSE Arca proposes to eliminate such
Application Processing Fee and will
impose no such fee for Derivative
Securities Products, Closed-End Funds
or Structured Products.
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2. Listing Fee
Currently, NYSE Arca charges a onetime Listing Fee of $20,000 for the first
Fund listed by a Fund issuer or Fund
‘‘family,’’ but does not currently charge
5 For purposes of this proposal, Derivative
Securities Products include securities qualified for
listing and trading on NYSE Arca under the
following NYSE Arca Equities Rules: Rule 5.2(j)(3)
(Investment Company Units), 5.2(j)(5) (Equity Gold
Shares), 8.100 Portfolio Depositary Receipts), 8.200
(Trust Issued Receipts), 8.201 (Commodity-Based
Trust Shares), 8.202 (Currency Trust Shares), 8.300
(Partnership Units), and 8.400 (Paired Trust
Securities), as these rules may be amended from
time to time.
Closed-End Funds are a type of investment
company registered under the Investment Company
Act of 1940 that offer a fixed number of shares.
Their assets are professionally managed in
accordance with the Closed-End Fund’s investment
objectives and policies, and may be invested in
stocks, fixed income securities or a combination of
both.
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18:21 May 11, 2007
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a. Derivative Securities Products
With this filing, NYSE Arca proposes
separate Listing Fees for Derivative
Securities Products and Closed-End
Funds. For Derivative Securities
Products, NYSE Arca Equities proposes
a Listing Fee fixed at $5,000 per
Derivative Securities Product. The
proposed Listing Fee applies regardless
of whether the Product lists in
conjunction with an initial public
offering, transfers from another
marketplace, or concurrently lists or is
already listed on another exchange or
market.
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To the extent that an issuer lists more
than one class of the same type of
security, the class with the greatest
number of shares issued will be deemed
the primary class.
When determining Listing Fees,
calculations are made at each level of
the schedule up to the last level
applicable to the number of securities
being listed. The total Listing Fee equals
the sum of the amounts calculated at
each level of the schedule. (Examples
are provided below, under ‘‘Calculating
Listing Fees.’’)
Number of securities issued
Up to and including 2 million ..
Over 2 million up to and including 4 million ..................
Over 4 million up to and including 300 million ..............
Over 300 million .....................
E:\FR\FM\14MYN1.SGM
14MYN1
Fee per
share
$0.01475
0.0074
0.0035
0.0019
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Federal Register / Vol. 72, No. 92 / Monday, May 14, 2007 / Notices
records, for example, changes of name,
par value, title of security or
designation.
Application Fee for Technical
Original Listings and Reverse Stock
Splits. NYSE Arca will apply a $5,000
application fee for a Technical Original
Listing if the change in the issuer’s
status is technical in nature and the
shareholders of the original issuer
receive or retain a share-for-share
interest in the new issuer without any
change in their equity position or rights.
For example, a change in a Closed-End
Fund’s state of incorporation or a
reincorporation or formation of a
holding company that replaces a listed
Closed-End Fund would be considered
a Technical Original Listing. The $5,000
application fee also will apply to a
reverse stock split.
Maximum Listing Fee for Stock Splits
and Stock Dividends. Listing fees on
shares issued in conjunction with stock
splits and stock dividends will be
capped at $150,000 per split or
issuance.
Maximum Listing Fee for Issuance of
Additional Shares of a Listed Class.
Listing Fees on the issuance of
additional shares of an already listed
class of stock are capped at $500,000 per
transaction, for example, in the case
where shares are issued in conjunction
with a merger or consolidation where a
listed company survives, subsequent
public offerings of a listed security and
conversions of convertible securities
into a listed security.
Discounts on Listing Fees. In the case
of transactions such as a consolidation
between two or more listed issuers that
result in the formation of a new issuer,
or a merger or consolidation between a
listed issuer and an unlisted issuer that
results in the unlisted issuer surviving
or the creation of a new issuer, where
at the conclusion of the transaction a
previously unlisted issuer immediately
lists, Listing Fees for that new issuer are
calculated at a rate of 25% of total
Listing Fees for each class of securities
being listed (to the extent that the total
calculated listing fee for a class of
common stock would be greater than
$250,000, the calculation would be 25%
of the $250,000 maximum for a new
listing of common stock).
No discount will be applied where a
listed issuer survives the merger or
consolidation, or in the case of a
backdoor listing (i.e., resulting from a
merger, acquisition or consolidation
which has the effect of circumventing
the standards for original listing).
Listing Fees for Pre-emptive Rights.
Preemptive rights representing equity
securities are not subject to a separate
Listing Fee. As of the date that
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Jkt 211001
preemptive rights are exercised, Listing
Fees will accrue on the securities issued
and the issuer will be billed for those
Listing Fees at the beginning of the
following year.
(3) Calculating Listing Fees
Treasury stock, restricted stock and
shares issued in conjunction with the
exercise of an over-allotment option, if
applicable, are included in the number
of shares a Closed-End Fund is billed for
at the time a security is first listed.
The following are examples of how
Listing Fees would be calculated by a
closed-end fund in the case of an
original listing and a subsequent
additional issuance of common stock:
Example A: A closed-end fund listing 50
million common shares in the context of an
initial public offering or transfer from
another market would pay total Listing Fees
of $40,000.
Example B: The same closed-end fund
subsequently applies to list an additional 5
million shares of common stock that are
immediately issued. The closed-end fund
will pay total Listing Fees of $17,500 for the
subsequent listing. Since the closed-end fund
already has 50 million shares outstanding,
the Listing Fee for the additional 5 million
shares is calculated at a rate of $0.0035 per
share.
c. Structured Products
The Fee Schedule is being amended
to specify that the $20,000 Listing Fee,
in addition to Initial Public Offerings,
applies to an initial listing (e.g., a listing
transfer to NYSE Arca from another
exchange).
3. Annual Fees
Currently, NYSE Arca charges Annual
Fees specifically for Exchange-Traded
Funds and Closed-End Funds based on
the aggregate total shares outstanding of
such Funds listed by the same Fund
issuer or Fund ‘‘family,’’ as follows:
Aggregate total shares
outstanding
Less than 10 million .................
10 million to less than 30 million .........................................
30 million to less than 50 million .........................................
50 million to less than 100 million .........................................
100 million to less than 250
million ....................................
250 million to less than 500
million ....................................
500 million to less than 750
million ....................................
750 million to less than one billion .........................................
Greater than one billion ............
Annual fee
$5,000
10,000
15,000
year of listing. The aggregate total shares
outstanding is calculated based on the
total shares outstanding as reported by
the Fund issuer or Fund ‘‘family’’ in its
most recent periodic filing with the
Commission or other publicly available
information. Annual Fees are not prorated or reduced for Funds that delist
for any reason. Annual Fees apply
regardless of whether any of these
Funds is listed elsewhere.
a. Derivative Securities Products
NYSE Arca Equities proposes revised
Annual Fees for Derivative Securities
Products based on total shares
outstanding for each issue, as follows:
Aggregate total shares outstanding
(each issue)
Less than 25 million .................
25 million up to 49,999,999 ......
50 million up to 99,999,999 ......
100 million up to 249,999,999 ..
250 million up to 499,999,999 ..
500 million and over .................
Annual fee
$2,000
4,000
8,000
15,000
20,000
25,000
The revised Annual Fee for Derivative
Securities Products will be billed
quarterly in arrears effective as of
January 1, 2007. As such, billing for the
first calendar quarter of 2007, for
example, will be based on the number
of shares outstanding for an issue on
March 30, 2007. For example, for an
issue with 45 million shares outstanding
on March 30, 2007, the Annual Fee
payable for the quarter would be $1,000
($4,000 Annual Fee divided by 4). If, at
the end of the second calendar quarter
of 2007, the number of shares
outstanding for such issue increased to
55 million, the Annual Fee payable for
such quarter would be $2,000 ($8,000
Annual Fee divided by 4). The
Exchange believes it is appropriate to
apply the revised Annual Fees to issuers
of the specified securities as of January
1, 2007 to permit the Exchange to apply
the fee in the same manner to all such
issuers listed on the Exchange,
including those listed in the first quarter
of 2007. The revised Annual Fee is
expected to be lower for some issuers
than the current Annual Fee.
b. Closed-End Funds
20,000
(1) Annual Fee Schedule for Primary
Listed Security
NYSE Arca Equities proposes the
40,000 following Annual Fee Schedule for a
Closed-End Fund’s primary class of
50,000
listed security (common stock, or
60,000 preferred stock if no common stock is
80,000 listed) and will be equal to the greater
of the minimum fee or the fee calculated
Annual Fees are assessed beginning in on a per share basis:
the first full calendar year following the Per Share Rate—$0.00093 per share
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30,000
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Minimum Fee—$25,000
The Annual Fee for Closed-End Funds
is payable in January each year, and
issuers are subject to Annual Fees in the
year of listing, pro-rated based on days
listed that calendar year.
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(2) Additional Classes of Listed Equity
Issues
The Annual Fee for equity issues
other than the primary class of security
listed will be the greater of the
minimum or the fee calculated on a per
share basis:
Per Share Rate—$0.00093 per share
Minimum Fee—$5,000
(3) Limitations on Annual Fees
Fund families that list between 3 and
14 Closed-End Funds will receive a 5%
discount off the calculated Annual Fee
for each fund listed, and those with 15
or more listed Closed-End Funds will
receive a discount of 15%. No fund
family shall pay aggregate Annual Fees
in excess of $1,000,000 in any given
year.
In the case of transactions involving
listed issuers (such as a consolidation
between two or more listed issuers that
results in the formation of a new issuer,
or a merger or consolidation between a
listed issuer and an unlisted issuer that
results in the unlisted issuer surviving
or the creation of a new issuer), where
at the conclusion of the transaction a
previously unlisted issuer immediately
lists, Annual Fees will not be charged to
that new issuer for the year in which it
lists to the extent that the transaction
concludes after March 31. To the extent
that the transaction concludes on or
before March 31 in any calendar year,
however, the newly listing issuer will be
charged pro rata Annual Fees from the
date of listing to the end of the year.
In addition, to the extent that a listed
issuer is involved in a consolidation
between two or more listed issuers that
results in the formation of a new issuer,
or a merger or consolidation between a
listed issuer and an unlisted issuer that
results in the unlisted issuer surviving
or the creation of a new issuer, or a
merger between two listed issuers where
one listed issuer survives, and the
transaction concludes on or before
March 31 in any calendar year, the nonsurviving listed issuer(s) will only be
subject to pro rata Annual Fees for that
year through the date of the conclusion
of the transaction. To the extent that the
transaction concludes after March 31,
the non-surviving listed issuer(s) will be
subject to full Annual Fees for that year.
4. Implementation
NYSE Arca proposes to implement
these revised fees, as applicable, to all
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18:21 May 11, 2007
Jkt 211001
issuers of Derivative Securities
Products, Closed-End Funds and
Structured Products as of January 1,
2007 with the exception of listing fees
for Closed-End Funds, which will take
effect as of the date of Commission
approval of the proposed rule change.
The Exchange believes such
implementation date is appropriate
under the circumstances described
below. NYSE Arca believes this
proposal will streamline and clarify the
fees applicable to Derivative Securities
Products and Closed-End Funds,
making them easier to understand and
apply while continuing to provide for
adequate support of the ongoing costs of
issuer services, including regulatory
oversight and product and service
offerings. Further, this proposal aligns
NYSE Arca listing and annual fees for
Derivative Securities Products and
Closed-End Funds with the fees charged
by the NYSE, further simplifying the
Fee Schedule and helping NYSE Arca to
compete more effectively for listings.
For Derivative Securities Products,
the proposed Listing Fees provide an
alternative fee structure and will in
certain circumstances be lower for
issuers than the previous Fee Schedule.
The Exchange believes it is appropriate
to apply these potential cost savings to
issuers as of January 2007.8
As discussed above, the revised
Annual Fee for Derivative Securities
Products will be billed quarterly in
arrears, beginning after the first calendar
quarter in 2007, effective as of January
1, 2007. The Annual Fee is expected to
be lower for some Derivative Securities
Products issuers than the current
Annual Fee, but may be higher in some
cases depending on the number of funds
listed by the same issuer and the shares
8 The Exchange notes that, with one exception
discussed below, the only Derivative Securities
Products currently listed on the Exchange are
Investment Company Units (Exchange-Traded
Funds) of one issuer of two separate trusts, which
were listed on the Exchange in 2006. Because these
listings were transfers from another national
securities exchange, the issuer incurred no listing
fee, in accordance with Commentary .04 to the
Exchange’s Fee Schedule (which will cease to have
effect on December 31, 2007). The Exchange has
advised the issuer of the proposed changes to the
Listing and Annual Fees. These two trusts listed six
and 13 funds, respectively. Except for Commentary
.04, the listing fee for each trust would have been
$20,000. For new Derivative Securities Product
issues, an issuer listing five or more issues would
incur a higher listing fee under the proposed
schedule than under the current schedule (e.g., an
issuer listing six funds would pay $30,000, and
$5,000 for each subsequent fund listed.) An
additional issuer listed a series of Investment
Company Units on the Exchange on March 28,
2007, and the issuer would incur an initial listing
fee of $20,000 under the current fee schedule and
$5,000 under the proposed schedule.
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27163
outstanding for each fund.9 The
proposed Annual Fee for Closed-End
Funds will apply as of January 1, 2007,
and, for issuers listed in calendar year
2007, will be pro-rated based on days
listed in 2007.10
2. Statutory Basis
NYSE Arca believes that the proposal
is consistent with Section 6(b) 11 of the
Act, in general, and Section 6(b)(4)12 of
the Act, in particular, in that it provides
for the equitable allocation of reasonable
dues, fees and other charges among its
issuers and other persons using its
facilities.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
NYSE Arca does not believe that the
proposed rule change will impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
NYSE Arca has neither solicited nor
received written comments on the
proposed modifications to its fee
schedule.
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
9 Taking the example of the two trusts discussed
above (see preceding footnote), the two trusts would
have incurred Annual Fees of $30,000 and $50,000,
respectively, based on the total aggregate shares of
each trust outstanding at year-end 2006 (assuming
the funds of each trust had been listed the entire
year and the shares outstanding remained constant
throughout the year). Under the proposed fee
schedule, Annual Fees will be based on total shares
outstanding of each fund. Accordingly, under the
same circumstances described above, the trusts
would incur an Annual Fee of $20,000 and $81,000,
respectively, based on shares outstanding of each of
their funds.
10 The Exchange notes that application of the
proposed Annual Fee as of January 1, 2007 for
Closed-End Funds will potentially impact only a
few issuers. Following discussions, beginning in
2006, with Closed-End Fund issuers about changes
to the Annual Fee, eight of these funds delisted
from the Exchange. The Exchange dually lists three
Closed-End Funds, one of which is pending
delisting.
11 15 U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(4).
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27164
Federal Register / Vol. 72, No. 92 / Monday, May 14, 2007 / Notices
(B) Institute proceedings to determine
whether the proposed rule change
should be disapproved.
III. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–NYSEArca–2007–22 on the
subject line.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.13
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–9177 Filed 5–11–07; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–55723; File No. SR–
NYSEArca–2007–38]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change and Amendment No. 1
Thereto Relating to Rule 6.80
Governing Accommodation
Transactions (Cabinet Trades)
May 8, 2007.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
• Send paper comments in triplicate
notice is hereby given that on April 17,
to Nancy M. Morris, Secretary,
2007, NYSE Arca, Inc. (‘‘NYSE Arca’’ or
Securities and Exchange Commission,
the ‘‘Exchange’’) filed with the
Station Place, 100 F Street, NE.,
Securities and Exchange Commission
Washington, DC 20549–1090.
(‘‘Commission’’) the proposed rule
All submissions should refer to File
change as described in Items I and II
Number SR–NYSEArca–2007–22. This
below, which Items have been
file number should be included on the
substantially prepared by the Exchange.
subject line if e-mail is used. To help the On May 7, 2007, NYSE Arca filed
Commission process and review your
Amendment No. 1 to the proposed rule
comments more efficiently, please use
change. The Commission is publishing
only one method. The Commission will this notice to solicit comment on the
post all comments on the Commission’s proposed rule change, as amended, from
interested persons.
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
I. Self-Regulatory Organization’s
submission, all subsequent
Statement of the Terms of Substance of
amendments, all written statements
the Proposed Rule Change
with respect to the proposed rule
The Exchange proposes to amend
change that are filed with the
NYSE Arca Rule 6.80 governing
Commission, and all written
Accommodation Transactions, also
communications relating to the
referred to as Cabinet Trades. The text
proposed rule change between the
of the proposed rule change is available
Commission and any person, other than
at NYSE Arca, the Commission’s Public
those that may be withheld from the
Reference Room, and https://
public in accordance with the
www.nysearca.com.
provisions of 5 U.S.C. 552, will be
II. Self-Regulatory Organization’s
available for inspection and copying in
Statement of the Purpose of, and
the Commission’s Public Reference
Room. Copies of such filing also will be Statutory Basis for, the Proposed Rule
Change
available for inspection and copying at
the principal office of the Exchange. All
In its filing with the Commission, the
Exchange included statements
comments received will be posted
concerning the purpose of and basis for
without change; the Commission does
the proposed rule change and discussed
not edit personal identifying
any comments it received on the
information from submissions. You
proposed rule change. The text of these
should submit only information that
you wish to make available publicly. All statements may be examined at the
places specified in Item IV below. The
submissions should refer to File
Number SR–NYSEArca–2007–22 and
13 17 CFR 200.30–3(a)(12).
should be submitted on or before June
1 15 U.S.C. 78s(b)(1).
4, 2007.
2 17 CFR 240.19b–4.
pwalker on PROD1PC71 with NOTICES
Paper Comments
VerDate Aug<31>2005
18:21 May 11, 2007
Jkt 211001
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Frm 00092
Fmt 4703
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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
Statutory Basis for, the Proposed Rule
Change
1. Purpose
An ‘‘accommodation’’ or ‘‘cabinet’’
trade refers to trades in listed options on
the Exchange that may be considered
worthless or which are not actively
traded. Exchange Rule 6.80,
Accommodation Transactions (Cabinet
Trades), which sets forth specific
procedures for engaging in cabinet
trades, currently (i) permits cabinet
trades to occur via open outcry at a
cabinet price of $1 per option contract
when the class does not trade on the
NYSE Arca automated electronic trading
system,3 and (ii) requires Market Makers
and Floor Brokers who wish to conduct
a cabinet transactions to place their
orders with a Trading Official.
The primary purpose of this rule
change is to amend Exchange Rule 6.80
to authorize Floor Brokers and Market
Makers to initiate cabinet trades. Under
the existing procedures, Market Makers
and Floor Brokers are only permitted to
(i) place cabinet orders with a Trading
Official and (ii) respond at a cabinet
price to a request for a quote from a
Trading Official. Pursuant to the
proposed amendment, Market Makers
and Floor Brokers will also be permitted
to initiate a cabinet trade in the trading
crowd on their own, without the need
to first place the order with a Trading
Official. This will save the additional
time and process involved in a Market
Maker or Floor Broker needing to first
place a cabinet order that they are
initiating, with a Trading Official, who
would then in turn represent and
execute the order on behalf of the
Market Maker or Floor Broker.
Permitting Market Makers and Floor
Brokers to initiate cabinet orders and
trades on their own accord will provide
Market Makers and Floor Brokers with
additional flexibility and will facilitate
the fair, orderly and efficient handling
of cabinet transactions on the Exchange.
Permitting Market Makers and Floor
Brokers to represent cabinet orders is
3 Cabinet orders were previously eligible for
automated electronic trading on the PCX Plus
system. NYSE Arca decommissioned the PCX Plus
electronic trading system during the fourth quarter
of 2006 and replaced it with the OX electronic
trading system. As a result, the Exchange proposes
to delete the name ‘‘PCX Plus’’ from the text of Rule
6.80. At this time no issues have been designated
for cabinet trading on OX or any other Exchange
sponsored electronic system.
E:\FR\FM\14MYN1.SGM
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]]>Agencies
[Federal Register Volume 72, Number 92 (Monday, May 14, 2007)]
[Notices]
[Pages 27160-27164]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-9177]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-55720; File No. SR-NYSEArca-2007-22]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to
Listing and Annual Fees for Derivative Securities Products and Closed-
End Funds
May 7, 2007.
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 27, 2007, NYSE Arca, Inc. (``NYSE Arca'' or the
``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 substantially prepared by NYSE
Arca. On May 1, 2007, NYSEArca filed Amendment No. 1 to the proposed
rule change.\3\ On May 3, 2007, NYSEArca filed Amendment No. 2 to the
proposed rule change.\4\ 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\ Amendment No. 1 replaces and supersedes the original filing
in its entirety.
\4\ Amendment No. 2 conforms a single category in the annual fee
chart for Derivative Securities Products in the purpose section with
the Fee Schedule; and amends the purpose section to reflect that an
additional issuer listed a series of Investment Company Units on the
Exchange on March 28, 2007.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
NYSE Arca, through its wholly owned subsidiary NYSE Arca Equities,
Inc. (``NYSE Arca Equities''), is proposing to amend its Schedule of
Fees and Charges (``Fee Schedule'') to revise the listing fees
applicable to Derivative Securities Products, Closed-End Funds and
Structured Products listed on NYSE Arca, L.L.C. (``NYSE Arca
Marketplace''), the equities facility of NYSE Arca Equities. The
Exchange also proposes related modifications to the Fee Schedule. The
text of the proposed rule change is available at NYSE Arca, the
Commission's Public Reference Room, and https://www.nysearca.com.
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 Arca 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 Arca 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 Arca has determined to revise the listing fees specifically
applicable to Derivative Securities Products (or
[[Page 27161]]
``Products''), Closed-End Funds and Structured Products,\5\ as follows:
---------------------------------------------------------------------------
\5\ For purposes of this proposal, Derivative Securities
Products include securities qualified for listing and trading on
NYSE Arca under the following NYSE Arca Equities Rules: Rule
5.2(j)(3) (Investment Company Units), 5.2(j)(5) (Equity Gold
Shares), 8.100 Portfolio Depositary Receipts), 8.200 (Trust Issued
Receipts), 8.201 (Commodity-Based Trust Shares), 8.202 (Currency
Trust Shares), 8.300 (Partnership Units), and 8.400 (Paired Trust
Securities), as these rules may be amended from time to time.
Closed-End Funds are a type of investment company registered
under the Investment Company Act of 1940 that offer a fixed number
of shares. Their assets are professionally managed in accordance
with the Closed-End Fund's investment objectives and policies, and
may be invested in stocks, fixed income securities or a combination
of both.
---------------------------------------------------------------------------
(1) Eliminate the Application Processing Fee for Derivative
Securities Products, Closed-End Funds and Structured Products;
(2) Impose an original listing fee of $5,000 per Derivative
Securities Product;
(3) Reduce, for some Derivative Securities Products, the Annual
Fee; and
(4) Establish a listing and annual fee schedule for Closed-End
Funds based on New York Stock Exchange LLC (``NYSE'') fees for Closed-
End Funds as set forth in Section 902.04 of the NYSE Listed Company
Manual.
This filing also proposes a number of related modifications to the
Fee Schedule. The proposed revisions will apply as of January 1, 2007
(with the exception of listing fees for Closed-End Funds).
Summary of Current and Proposed Fees
1. Application Processing Fee
Currently, NYSE Arca levies a non-refundable application processing
fee of $500 for all applications to list ``Funds'' (which term
currently encompasses Exchange-Traded Funds and Closed-End Funds)
submitted at the same time by a Fund issuer or ``family'' regardless of
the number of Funds to be listed. This fee is currently credited
towards the applicable initial Listing Fee if the application is
approved, or if the Fund issuer or ``family'' is not subject to an
initial Listing Fee, towards the applicable Annual Fee. With this
filing, NYSE Arca proposes to eliminate such Application Processing Fee
and will impose no such fee for Derivative Securities Products, Closed-
End Funds or Structured Products.
2. Listing Fee
Currently, NYSE Arca charges a one-time Listing Fee of $20,000 for
the first Fund listed by a Fund issuer or Fund ``family,'' but does not
currently charge a Listing Fee for subsequent additional listings of
Funds from the same Fund issuer or ``family,'' regardless of whether
one or more previously listed Funds remains listed on NYSE Arca.\6\
Further, this Listing Fee applies regardless of whether the Fund(s)
lists in conjunction with an initial public offering, transfers from
another marketplace, or concurrently lists or is already listed on
another exchange or market.
---------------------------------------------------------------------------
\6\ Footnote 1 to the Exchange's current Fee Schedule states
that Fund ``families'' are those with a common investment advisor or
investment advisors, which are ``affiliated persons'' as defined in
the securities laws.
---------------------------------------------------------------------------
a. Derivative Securities Products
With this filing, NYSE Arca proposes separate Listing Fees for
Derivative Securities Products and Closed-End Funds. For Derivative
Securities Products, NYSE Arca Equities proposes a Listing Fee fixed at
$5,000 per Derivative Securities Product. The proposed Listing Fee
applies regardless of whether the Product lists in conjunction with an
initial public offering, transfers from another marketplace, or
concurrently lists or is already listed on another exchange or market.
b. Closed-End Funds \7\
---------------------------------------------------------------------------
\7\ These fees are substantially identical to the fees charged
by the NYSE for Closed-End Funds. See NYSE Listed Company Manual,
Section 902.04.
---------------------------------------------------------------------------
When a Closed-End Fund lists a class of common stock, or first
lists a class of preferred stock in a case where common stock is not
already listed, NYSE Arca Equities proposes Listing Fees as follows:
------------------------------------------------------------------------
Total
Number of securities issued listing fee
------------------------------------------------------------------------
Up to and including 10 million............................. $20,000
Over 10 million up to and including 20 million............. 30,000
Over 20 million............................................ 40,000
------------------------------------------------------------------------
(1) Listing Additional Securities by a Closed-End Fund
In the case of the following types of additional listings, Listing
Fees are calculated on a per share basis for each class according to
the Listing Fee schedule below:
At the time it first lists, a Closed-End Fund lists one or
more classes of preferred stock or warrants in addition to a primary
class of common stock or preferred stock;
Once listed, a Closed-End Fund lists additional shares of
a class of previously listed securities; or
Once listed, a Closed-End Fund lists a new class of
preferred stock or warrants.
To the extent that an issuer lists more than one class of the same
type of security, the class with the greatest number of shares issued
will be deemed the primary class.
When determining Listing Fees, calculations are made at each level
of the schedule up to the last level applicable to the number of
securities being listed. The total Listing Fee equals the sum of the
amounts calculated at each level of the schedule. (Examples are
provided below, under ``Calculating Listing Fees.'')
------------------------------------------------------------------------
Fee per
Number of securities issued share
------------------------------------------------------------------------
Up to and including 2 million............................. $0.01475
Over 2 million up to and including 4 million.............. 0.0074
Over 4 million up to and including 300 million............ 0.0035
Over 300 million.......................................... 0.0019
------------------------------------------------------------------------
(2) Limitations on Closed-End Fund Listing Fees
Fund Family Discount. If two or more closed-end funds from the same
fund family list at approximately the same time, the Exchange will cap
the collective Listing Fee for those funds at $75,000. The Exchange
will consider funds from the same fund family to be listing at
approximately the same time if an issuer provides notice that such
funds will be listed as part of the same transaction. A fund family
consists of closed-end funds with a common investment adviser or
investment advisers who are ``affiliated persons'' as defined in
Section 2(a)(3) of the Investment Company Act of 1940, as amended.
Limitation on Listing Fees for Additional Class of Common Shares. A
Closed-End Fund that applies to list a new class of common shares in
addition to its primary class will be charged a fixed Listing Fee of
$5,000 in lieu of the per share schedule.
Minimum Listing Fee for Subsequent Listing of Additional
Securities. NYSE Arca will impose a minimum application fee for a
subsequent listing of additional securities of $2,500. When listing
additional securities, an issuer is billed Listing Fees in an amount
equal to the greater of the $2,500 minimum supplemental listing
application fee and the fee calculated on a per share basis. This
applies to the listing of additional shares of an already listed equity
security or to the listing of an additional class of equity security
(other than a new class of common shares).
Fee for Certain Changes. NYSE Arca will charge a $2,500 fee for
changes that involve modifications to Exchange
[[Page 27162]]
records, for example, changes of name, par value, title of security or
designation.
Application Fee for Technical Original Listings and Reverse Stock
Splits. NYSE Arca will apply a $5,000 application fee for a Technical
Original Listing if the change in the issuer's status is technical in
nature and the shareholders of the original issuer receive or retain a
share-for-share interest in the new issuer without any change in their
equity position or rights. For example, a change in a Closed-End Fund's
state of incorporation or a reincorporation or formation of a holding
company that replaces a listed Closed-End Fund would be considered a
Technical Original Listing. The $5,000 application fee also will apply
to a reverse stock split.
Maximum Listing Fee for Stock Splits and Stock Dividends. Listing
fees on shares issued in conjunction with stock splits and stock
dividends will be capped at $150,000 per split or issuance.
Maximum Listing Fee for Issuance of Additional Shares of a Listed
Class. Listing Fees on the issuance of additional shares of an already
listed class of stock are capped at $500,000 per transaction, for
example, in the case where shares are issued in conjunction with a
merger or consolidation where a listed company survives, subsequent
public offerings of a listed security and conversions of convertible
securities into a listed security.
Discounts on Listing Fees. In the case of transactions such as a
consolidation between two or more listed issuers that result in the
formation of a new issuer, or a merger or consolidation between a
listed issuer and an unlisted issuer that results in the unlisted
issuer surviving or the creation of a new issuer, where at the
conclusion of the transaction a previously unlisted issuer immediately
lists, Listing Fees for that new issuer are calculated at a rate of 25%
of total Listing Fees for each class of securities being listed (to the
extent that the total calculated listing fee for a class of common
stock would be greater than $250,000, the calculation would be 25% of
the $250,000 maximum for a new listing of common stock).
No discount will be applied where a listed issuer survives the
merger or consolidation, or in the case of a backdoor listing (i.e.,
resulting from a merger, acquisition or consolidation which has the
effect of circumventing the standards for original listing).
Listing Fees for Pre-emptive Rights. Preemptive rights representing
equity securities are not subject to a separate Listing Fee. As of the
date that preemptive rights are exercised, Listing Fees will accrue on
the securities issued and the issuer will be billed for those Listing
Fees at the beginning of the following year.
(3) Calculating Listing Fees
Treasury stock, restricted stock and shares issued in conjunction
with the exercise of an over-allotment option, if applicable, are
included in the number of shares a Closed-End Fund is billed for at the
time a security is first listed.
The following are examples of how Listing Fees would be calculated
by a closed-end fund in the case of an original listing and a
subsequent additional issuance of common stock:
Example A: A closed-end fund listing 50 million common shares in
the context of an initial public offering or transfer from another
market would pay total Listing Fees of $40,000.
Example B: The same closed-end fund subsequently applies to list
an additional 5 million shares of common stock that are immediately
issued. The closed-end fund will pay total Listing Fees of $17,500
for the subsequent listing. Since the closed-end fund already has 50
million shares outstanding, the Listing Fee for the additional 5
million shares is calculated at a rate of $0.0035 per share.
c. Structured Products
The Fee Schedule is being amended to specify that the $20,000
Listing Fee, in addition to Initial Public Offerings, applies to an
initial listing (e.g., a listing transfer to NYSE Arca from another
exchange).
3. Annual Fees
Currently, NYSE Arca charges Annual Fees specifically for Exchange-
Traded Funds and Closed-End Funds based on the aggregate total shares
outstanding of such Funds listed by the same Fund issuer or Fund
``family,'' as follows:
------------------------------------------------------------------------
Aggregate total shares outstanding Annual fee
------------------------------------------------------------------------
Less than 10 million....................................... $5,000
10 million to less than 30 million......................... 10,000
30 million to less than 50 million......................... 15,000
50 million to less than 100 million........................ 20,000
100 million to less than 250 million....................... 30,000
250 million to less than 500 million....................... 40,000
500 million to less than 750 million....................... 50,000
750 million to less than one billion....................... 60,000
Greater than one billion................................... 80,000
------------------------------------------------------------------------
Annual Fees are assessed beginning in the first full calendar year
following the year of listing. The aggregate total shares outstanding
is calculated based on the total shares outstanding as reported by the
Fund issuer or Fund ``family'' in its most recent periodic filing with
the Commission or other publicly available information. Annual Fees are
not pro-rated or reduced for Funds that delist for any reason. Annual
Fees apply regardless of whether any of these Funds is listed
elsewhere.
a. Derivative Securities Products
NYSE Arca Equities proposes revised Annual Fees for Derivative
Securities Products based on total shares outstanding for each issue,
as follows:
------------------------------------------------------------------------
Aggregate total shares outstanding (each issue) Annual fee
------------------------------------------------------------------------
Less than 25 million....................................... $2,000
25 million up to 49,999,999................................ 4,000
50 million up to 99,999,999................................ 8,000
100 million up to 249,999,999.............................. 15,000
250 million up to 499,999,999.............................. 20,000
500 million and over....................................... 25,000
------------------------------------------------------------------------
The revised Annual Fee for Derivative Securities Products will be
billed quarterly in arrears effective as of January 1, 2007. As such,
billing for the first calendar quarter of 2007, for example, will be
based on the number of shares outstanding for an issue on March 30,
2007. For example, for an issue with 45 million shares outstanding on
March 30, 2007, the Annual Fee payable for the quarter would be $1,000
($4,000 Annual Fee divided by 4). If, at the end of the second calendar
quarter of 2007, the number of shares outstanding for such issue
increased to 55 million, the Annual Fee payable for such quarter would
be $2,000 ($8,000 Annual Fee divided by 4). The Exchange believes it is
appropriate to apply the revised Annual Fees to issuers of the
specified securities as of January 1, 2007 to permit the Exchange to
apply the fee in the same manner to all such issuers listed on the
Exchange, including those listed in the first quarter of 2007. The
revised Annual Fee is expected to be lower for some issuers than the
current Annual Fee.
b. Closed-End Funds
(1) Annual Fee Schedule for Primary Listed Security
NYSE Arca Equities proposes the following Annual Fee Schedule for a
Closed-End Fund's primary class of listed security (common stock, or
preferred stock if no common stock is listed) and will be equal to the
greater of the minimum fee or the fee calculated on a per share basis:
Per Share Rate--$0.00093 per share
[[Page 27163]]
Minimum Fee--$25,000
The Annual Fee for Closed-End Funds is payable in January each
year, and issuers are subject to Annual Fees in the year of listing,
pro-rated based on days listed that calendar year.
(2) Additional Classes of Listed Equity Issues
The Annual Fee for equity issues other than the primary class of
security listed will be the greater of the minimum or the fee
calculated on a per share basis:
Per Share Rate--$0.00093 per share
Minimum Fee--$5,000
(3) Limitations on Annual Fees
Fund families that list between 3 and 14 Closed-End Funds will
receive a 5% discount off the calculated Annual Fee for each fund
listed, and those with 15 or more listed Closed-End Funds will receive
a discount of 15%. No fund family shall pay aggregate Annual Fees in
excess of $1,000,000 in any given year.
In the case of transactions involving listed issuers (such as a
consolidation between two or more listed issuers that results in the
formation of a new issuer, or a merger or consolidation between a
listed issuer and an unlisted issuer that results in the unlisted
issuer surviving or the creation of a new issuer), where at the
conclusion of the transaction a previously unlisted issuer immediately
lists, Annual Fees will not be charged to that new issuer for the year
in which it lists to the extent that the transaction concludes after
March 31. To the extent that the transaction concludes on or before
March 31 in any calendar year, however, the newly listing issuer will
be charged pro rata Annual Fees from the date of listing to the end of
the year.
In addition, to the extent that a listed issuer is involved in a
consolidation between two or more listed issuers that results in the
formation of a new issuer, or a merger or consolidation between a
listed issuer and an unlisted issuer that results in the unlisted
issuer surviving or the creation of a new issuer, or a merger between
two listed issuers where one listed issuer survives, and the
transaction concludes on or before March 31 in any calendar year, the
non-surviving listed issuer(s) will only be subject to pro rata Annual
Fees for that year through the date of the conclusion of the
transaction. To the extent that the transaction concludes after March
31, the non-surviving listed issuer(s) will be subject to full Annual
Fees for that year.
4. Implementation
NYSE Arca proposes to implement these revised fees, as applicable,
to all issuers of Derivative Securities Products, Closed-End Funds and
Structured Products as of January 1, 2007 with the exception of listing
fees for Closed-End Funds, which will take effect as of the date of
Commission approval of the proposed rule change. The Exchange believes
such implementation date is appropriate under the circumstances
described below. NYSE Arca believes this proposal will streamline and
clarify the fees applicable to Derivative Securities Products and
Closed-End Funds, making them easier to understand and apply while
continuing to provide for adequate support of the ongoing costs of
issuer services, including regulatory oversight and product and service
offerings. Further, this proposal aligns NYSE Arca listing and annual
fees for Derivative Securities Products and Closed-End Funds with the
fees charged by the NYSE, further simplifying the Fee Schedule and
helping NYSE Arca to compete more effectively for listings.
For Derivative Securities Products, the proposed Listing Fees
provide an alternative fee structure and will in certain circumstances
be lower for issuers than the previous Fee Schedule. The Exchange
believes it is appropriate to apply these potential cost savings to
issuers as of January 2007.\8\
---------------------------------------------------------------------------
\8\ The Exchange notes that, with one exception discussed below,
the only Derivative Securities Products currently listed on the
Exchange are Investment Company Units (Exchange-Traded Funds) of one
issuer of two separate trusts, which were listed on the Exchange in
2006. Because these listings were transfers from another national
securities exchange, the issuer incurred no listing fee, in
accordance with Commentary .04 to the Exchange's Fee Schedule (which
will cease to have effect on December 31, 2007). The Exchange has
advised the issuer of the proposed changes to the Listing and Annual
Fees. These two trusts listed six and 13 funds, respectively. Except
for Commentary .04, the listing fee for each trust would have been
$20,000. For new Derivative Securities Product issues, an issuer
listing five or more issues would incur a higher listing fee under
the proposed schedule than under the current schedule (e.g., an
issuer listing six funds would pay $30,000, and $5,000 for each
subsequent fund listed.) An additional issuer listed a series of
Investment Company Units on the Exchange on March 28, 2007, and the
issuer would incur an initial listing fee of $20,000 under the
current fee schedule and $5,000 under the proposed schedule.
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As discussed above, the revised Annual Fee for Derivative
Securities Products will be billed quarterly in arrears, beginning
after the first calendar quarter in 2007, effective as of January 1,
2007. The Annual Fee is expected to be lower for some Derivative
Securities Products issuers than the current Annual Fee, but may be
higher in some cases depending on the number of funds listed by the
same issuer and the shares outstanding for each fund.\9\ The proposed
Annual Fee for Closed-End Funds will apply as of January 1, 2007, and,
for issuers listed in calendar year 2007, will be pro-rated based on
days listed in 2007.\10\
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\9\ Taking the example of the two trusts discussed above (see
preceding footnote), the two trusts would have incurred Annual Fees
of $30,000 and $50,000, respectively, based on the total aggregate
shares of each trust outstanding at year-end 2006 (assuming the
funds of each trust had been listed the entire year and the shares
outstanding remained constant throughout the year). Under the
proposed fee schedule, Annual Fees will be based on total shares
outstanding of each fund. Accordingly, under the same circumstances
described above, the trusts would incur an Annual Fee of $20,000 and
$81,000, respectively, based on shares outstanding of each of their
funds.
\10\ The Exchange notes that application of the proposed Annual
Fee as of January 1, 2007 for Closed-End Funds will potentially
impact only a few issuers. Following discussions, beginning in 2006,
with Closed-End Fund issuers about changes to the Annual Fee, eight
of these funds delisted from the Exchange. The Exchange dually lists
three Closed-End Funds, one of which is pending delisting.
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2. Statutory Basis
NYSE Arca believes that the proposal is consistent with Section
6(b) \11\ of the Act, in general, and Section 6(b)(4)\12\ of the Act,
in particular, in that it provides for the equitable allocation of
reasonable dues, fees and other charges among its issuers and other
persons using its facilities.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
NYSE Arca does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
NYSE Arca has neither solicited nor received written comments on
the proposed modifications to its fee schedule.
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
[[Page 27164]]
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
III. 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 No. SR-NYSEArca-2007-22 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-NYSEArca-2007-22. 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 Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NYSEArca-2007-22 and should be submitted on or before
June 4, 2007.
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. E7-9177 Filed 5-11-07; 8:45 am]
BILLING CODE 8010-01-P
