II

104TH CONGRESS

2D SESSION S. 1855

To reduce registration fees required to be paid by issuers of securities,

and for other purposes.

IN THE SENATE OF THE UNITED STATES

JUNE 10, 1996

Mr. GRAMM (for himself and Mr. D’AMATO) introduced the following bill;

which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

A BILL

To reduce registration fees required to be paid by issuers

of securities, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Securities and Ex5 change Commission Fee Reduction Act of 1996’’.

6 SEC. 2. REDUCING REGISTRATION FEES.

7 Section 6(b) of the Securities Act of 1933 (15 U.S.C.

8 77f(b)) is amended to read as follows:

9 ‘‘(b) REGISTRATION FEE.—

10 ‘‘(1) FEE PAYMENT REQUIRED.—
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1 ‘‘(A) IN GENERAL.—At the time of filing a

2 registration statement, the applicant shall pay

3 to the Commission a fee that shall be equal to

4 the sum of the amounts (if any) determined

5 under the rates established by paragraph (3).

6 ‘‘(B) PUBLICATION OF FEES.—The Com7 mission shall publish in the Federal Register

8 notices of the fee rates applicable under this

9 subsection for each fiscal year.

10 ‘‘(C) AMOUNTS OF FEES.—In no case shall

11 a minimum fee required by this subsection be

12 greater than $100.

13 ‘‘(2) GENERAL REVENUE FEES.—

14 ‘‘(A) RATE.—The rate determined under

15 this paragraph is a rate equal to—

16 ‘‘(i) during each fiscal year before fis17 cal year 2002, $200 for each $1,000,000

18 of the maximum aggregate price at which

19 the subject securities are proposed to be

20 offered; and

21 ‘‘(ii) during fiscal year 2002 and each

22 succeeding fiscal year, $182 for each

23 $1,000,000 of the maximum aggregate

24 price at which the subject securities are

25 proposed to be offered.
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1 ‘‘(B) REVENUES OF TREASURY.—Fees col2 lected during any fiscal year pursuant to this

3 paragraph shall be deposited and credited as

4 general revenues of the Treasury.

5 ‘‘(3) OFFSETTING COLLECTION FEES.—

6 ‘‘(A) IN GENERAL.—Except as provided in

7 subparagraphs (B) and (C), for each

8 $1,000,000 of the maximum aggregate price at

9 which the subject securities are proposed to be

10 offered, the rate determined under this para11 graph is a rate equal to—

12 ‘‘(i) $103 during fiscal year 1997;

13 ‘‘(ii) $70 during fiscal year 1998;

14 ‘‘(iii) $38 during fiscal year 1999;

15 ‘‘(iv) $17 during fiscal year 2000; and

16 ‘‘(v) $0 during fiscal year 2001 or any

17 succeeding fiscal year.

18 ‘‘(B) LIMITATION; DEPOSIT.—Except as

19 provided in subparagraph (C), no amounts shall

20 be collected pursuant to this paragraph for any

21 fiscal year except to the extent provided in ad22 vance in appropriations Acts. Fees collected

23 during any fiscal year pursuant to this para24 graph shall be deposited and credited as offset-
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1 ting collections in accordance with appropria2 tions Acts.

3 ‘‘(C) LAPSE OF APPROPRIATIONS.—If, on

4 the first day of a fiscal year, a regular appro5 priation to the Commission has not been en6 acted, the Commission shall continue to collect

7 fees (as offsetting collections) under this para8 graph at the rate in effect during the preceding

9 fiscal year, until such a regular appropriation is

10 enacted.’’.

11 SEC. 3. TRANSACTION FEES.

12 (a) AMENDMENT.—Section 31 of the Securities Ex13 change Act of 1934 (15 U.S.C. 78ee) is amended to read

14 as follows:

15 ‘‘SEC. 31. TRANSACTION FEES.

16 ‘‘(a) EXCHANGE-TRADED SECURITIES.—

17 ‘‘(1) RATE.—Each national securities exchange

18 shall pay to the Commission a fee at a rate equal

19 to—

20 ‘‘(A) $33 for each $1,000,000 of the ag21 gregate dollar amount of sales of securities

22 (other than bonds, debentures, and other evi23 dences of indebtedness) transacted on such na24 tional securities exchange during the period to

25 which the fee relates under subsection (d); and
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1 ‘‘(B) for fiscal year 2002 and each suc2 ceeding fiscal year, $25 for each $1,000,000 of

3 such aggregate dollar amount of sales during

4 the period to which the fee relates under sub5 section (d).

6 ‘‘(2) REVENUES OF TREASURY.—Fees collected

7 pursuant to this subsection shall be deposited and

8 collected as general revenue of the Treasury.

9 ‘‘(b) OFF-EXCHANGE-TRADES OF EXCHANGE-REG10 ISTERED SECURITIES.—

11 ‘‘(1) RATES.—Each national securities associa12 tion shall pay to the Commission a fee at a rate

13 equal to—

14 ‘‘(A) $33 for each $1,000,000 of the ag15 gregate dollar amount of sales transacted dur16 ing the period to which the fee relates under

17 subsection (d) by or through any member of

18 such association otherwise than on a national

19 securities exchange of securities registered on

20 such an exchange (other than bonds, deben21 tures, and other evidences of indebtedness); and

22 ‘‘(B) for fiscal year 2002 and each suc23 ceeding fiscal year, $25 for each $1,000,000 of

24 the aggregate dollar amount of sales referral to
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1 in subparagraph (A) during the period to which

2 the fee relates under subsection (d).

3 ‘‘(2) REVENUES OF TREASURY.—Fees collected

4 pursuant to this subsection shall be deposited and

5 collected as general revenue of the Treasury.

6 ‘‘(c) OFF-EXCHANGE-TRADES OF LAST-SALE-RE7 PORTED SECURITIES.—

8 ‘‘(1) COVERED TRANSACTIONS.—Each national

9 securities association shall pay to the Commission a

10 fee at a rate equal to the dollar amount determined

11 under paragraph (2) for each $1,000,000 of the ag12 gregate dollar amount of sales transacted during the

13 period to which the fee relates under subsection (d)

14 by or through any member of such association other15 wise than on a national securities exchange of secu16 rities (other than bonds, debentures, and other evi17 dences of indebtedness) subject to prompt last sale

18 reporting pursuant to the rules of the Commission

19 or a registered national securities association, ex20 cluding any sales for which a fee is paid under sub21 section (b).

22 ‘‘(2) FEE RATES.—Except as provided in para23 graph (4), the dollar amount determined under this

24 paragraph is—

25 ‘‘(A) $12 for fiscal year 1997;
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1 ‘‘(B) $14 for fiscal year 1998;

2 ‘‘(C) $17 for fiscal year 1999;

3 ‘‘(D) $18 for fiscal year 2000;

4 ‘‘(E) $20 for fiscal year 2001; and

5 ‘‘(F) $25 for fiscal year 2002 or for any

6 succeeding fiscal year.

7 ‘‘(3) LIMITATION; DEPOSIT OF FEES.—Except

8 as provided in paragraph (4), no amounts shall be

9 collected pursuant to this subsection for any fiscal

10 year beginning before October 1, 2001, except to the

11 extent provided in advance in appropriations Acts.

12 Fees collected during any such fiscal year pursuant

13 to this subsection shall be deposited and credited as

14 offsetting collections to the account providing appro15 priations to the Commission, except that any

16 amounts in excess of the following amounts (and any

17 amount collected for fiscal years beginning on or

18 after October 1, 2001) shall be deposited and cred19 ited as general revenues of the Treasury:

20 ‘‘(A) $20,000,000 for fiscal year 1997.

21 ‘‘(B) $26,000,000 for fiscal year 1998.

22 ‘‘(C) $32,000,000 for fiscal year 1999.

23 ‘‘(D) $32,000,000 for fiscal year 2000.

24 ‘‘(E) $32,000,000 for fiscal year 2001.
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1 ‘‘(F) $0 for fiscal year 2002 and any suc2 ceeding fiscal year.

3 ‘‘(4) LAPSE OF APPROPRIATIONS.—If, on the

4 first day of a fiscal year, a regular appropriation to

5 the Commission has not been enacted, the Commis6 sion shall continue to collect fees (as offsetting col7 lections) under this subsection at the rate in effect

8 during the preceding fiscal year, until such a regular

9 appropriation is enacted.

10 ‘‘(d) DATES FOR PAYMENT OF FEES.—The fees re11 quired by subsections (a), (b), and (c) shall be paid—

12 ‘‘(1) on or before March 15, with respect to

13 transactions and sales occurring during the period

14 beginning on the preceding September 1 and ending

15 at the close of the preceding December 31; and

16 ‘‘(2) on or before September 30, with respect to

17 transactions and sales occurring during the period

18 beginning on the preceding January 1 and ending at

19 the close of the preceding August 31.

20 ‘‘(e) EXEMPTIONS.—

21 ‘‘(1) COMMISSION AUTHORITY.—The Commis22 sion may, by rule, exempt any sale of securities or

23 any class of sales of securities from any fee imposed

24 by this section, if the Commission finds that such

25 exemption is consistent with the public interest, the
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1 equal regulation of markets and brokers and dealers,

2 and the development of a national market system.

3 ‘‘(2) LOW-VOLUME TRANSACTIONS.—No fee

4 shall be assessed under this section for transactions

5 involving portfolios of equity securities taking place

6 at times of day characterized by low volume and

7 during nontraditional trading hours, as determined

8 by the Commission.

9 ‘‘(f) PUBLICATION.—The Commission shall publish

10 in the Federal Register notices of the fee rates applicable

11 under this section for each fiscal year.’’.

12 (b) EFFECTIVE DATE; TRANSITION.—

13 (1) EFFECTIVE DATE.—Except as provided in

14 paragraph (2), the amendment made by subsection

15 (a) shall apply with respect to transactions in securi16 ties that occur on or after October 1, 1996.

17 (2) OFF-EXCHANGE TRADES OF LAST SALE RE18 PORTED TRANSACTIONS.—The amendment made by

19 subsection (a) shall apply with respect to trans20 actions described in section 31(d)(1) of the Securi21 ties Exchange Act of 1934 (as amended by sub22 section (a) of this section) that occur on or after Oc23 tober 1, 1996.

24 (3) RULE OF CONSTRUCTION.—Nothing in this

25 subsection shall be construed to affect the obligation
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1 of national securities exchanges and registered bro2 kers and dealers under section 31 of the Securities

3 Exchange Act of 1934, as in effect on the day before

4 the effective date of the amendment made by sub5 section (a), to make the payments required by such

6 section on March 15, 1997.

7 SEC. 4. TIME FOR PAYMENT.

8 Section 4(e) of the Securities Exchange Act of 1934

9 (15 U.S.C. 78d(e)) is amended by inserting before the pe10 riod at the end the following: ‘‘, and the Commission may

11 also specify the time that such fee shall be determined and

12 paid relative to the filing of any statement or document

13 with the Commission’’.

14 SEC. 5. ELIMINATION OF UNNECESSARY FEES.

15 The fees authorized by the amendments made by this

16 Act are in lieu of, and not in addition to, any fees that

17 the Securities and Exchange Commission is authorized to

18 impose or collect pursuant to section 9701 of title 31,

19 United States Code.

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