[Federal Register Volume 69, Number 24 (Thursday, February 5, 2004)]
[Notices]
[Pages 5642-5643]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-2334]



[[Page 5642]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49140; File No. SR-PCX-2003-72]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc. 
Relating to Exchange Fees and Charges

January 28, 2004.
    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 January 2, 2004, the Pacific Exchange, Inc. (``PCX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III, below, which the PCX has prepared. The PCX has designated this 
proposal as one establishing or changing a due, fee or other charge 
imposed by the self-regulatory organization under Section 
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\ 
which renders the rule effective upon Commission receipt of this 
filing. The Commission is publishing this notice to solicit comments on 
the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The PCX proposes to amend the Trade-Related Charges portion of its 
Schedule of Fees and Charges (``Schedule'') in order to delete the fee 
relating to its Volume Discount Program.
    The text of the proposed rule change is below. Proposed deletions 
are in [brackets].
* * * * *

Schedule of Fees and Charges for Exchange Services

PCX Options: Trade-Related Charges

Transactions

Customer                           $0.00 per contract side
Firm                               $0.10 per contract side for customer
                                    facilitation
Broker/Dealer                      $0.21 per contract side
 


------------------------------------------------------------------------
                                              Market share
     Market share tiers         Marg rate        tiers        Marg rate
------------------------------------------------------------------------
0.00% to 11.00%.............        $0.21   0% to 15%......        $0.21
11.00% to 20.00%............         0.11   15% to 25%.....         0.15
20% to 100.00%..............  ............  25% to 100%....         0.05
------------------------------------------------------------------------


Market Maker Marginal Transaction  Market Maker Marginal Transaction
 Rates on Top 120 Issues            Rates on Non-Top 120 Issues. Singly
                                    listed issues will be assessed a
                                    flat $0.21 Market Maker transaction
                                    charge.
[VOLUME DISCOUNT PROGRAM
PCX Quarterly Average Daily        Per Contract Reduction in Market
 Contract Volume                    Maker Transaction Charge For
                                    Following Quarter
449,000 or lower.................  No reduction
450,000 to 474,999...............  $0.01
475,000 to 499,999...............  $0.02
500,000 to 524,999...............  $0.03
525,000 or higher................  $0.04]
 

* * * * *

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is proposing to amend the Trade-Related Charges 
portion of its Schedule in order to delete the fee relating to its 
Volume Discount Program. On December 16, 2003, the Exchange submitted a 
filing with the Commission to implement the new Incentive Pricing 
Program for Market Maker transaction charges.\5\ As part of its ongoing 
effort to secure existing volumes and attract higher levels of 
liquidity, the PCX proposed a three-tiered rate schedule that would 
lower transaction charges for Market Makers (including Lead Market 
Makers) as the Exchange attains higher levels of market share on 
individual issues. The Incentive Pricing Program became effective upon 
filing. As a result of the application of the new Incentive Pricing 
Program, the Exchange no longer has need for the Volume Discount 
Program and proposes to eliminate it from the Schedule.
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    \5\ See Securities Exchange Act Release No. 48976 (December 23, 
2003), 68 F.R. 75701 (December 31, 2003) (SR-PCX-2003-68).
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2. Statutory Basis
    The Exchange believes that this proposal to amend its schedule of 
dues, fees and charges would be an equitable allocation of reasonable 
fees among PCX members, and that the proposal is consistent with 
Section 6(b) of the Act \6\ and furthers the objectives of Section 
6(b)(4) of the Act.\7\
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).

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[[Page 5643]]

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

    PCX does not believe that the proposed rule change will impose any 
inappropriate burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    PCX neither solicited nor received written comments on this 
proposal.

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

    The foregoing proposed rule change has been designated as a fee 
change pursuant to Section 19(b)(3)(A)(ii) of the Act \8\ and Rule 19b-
4(f)(2)\9\ thereunder. Accordingly, the proposal has taken effect upon 
filing with the Commission. At any time within 60 days after the filing 
of the proposed rule change, the Commission may summarily abrogate the 
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.
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    \8\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \9\ 17 CFR 240.19b-4(f)(2).
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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. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
Comments may also be submitted electronically at the following e-mail 
address: <a href="/cdn-cgi/l/email-protection#6614130a034b05090b0b030812152615030548010910"><span class="__cf_email__" data-cfemail="0b797e676e26686466666e657f784b786e68256c647d">[email protected]</span></a>. All comment letters should refer to 
File No. SR-PCX-2003-72. This file number should be included on the 
subject line if e-mail is used. To help the Commission process and 
review your comments more efficiently, comments should be sent in hard 
copy or by e-mail, but not by both methods. 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 will also be available for 
inspection and copying at the principal office of PCX. All submissions 
should refer to File No. SR-PCX-2003-72 and should be submitted by 
February 26, 2004.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 04-2334 Filed 2-4-04; 8:45 am]
BILLING CODE 8010-01-P


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