Federal Register / Vol. 66, No. 241 / Friday, December 14, 2001 / Notices 64895

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 44962

(October 19, 2001), 66 FR 54562.

4See Letter from W. Hardy Callcott, Senior Vice

President and General Counsel, Charles Schwab &

Co., Inc. to Jonathan G. Katz, Secretary,

Commission, dated November 20, 2001 (‘‘Schwab

Letter’’).

5The Exchange noted that although no other

exchange currently offers a limit order data

compilation, a few markets offer services that

provide a point of reference. According to the

Exchange, the Nasdaq Stock Market charges $50 per

terminal for its Nasdaq Level II service for

professional interrogation devices, which provides

the best bid and offer from all market makers and

ECNs (although it does not otherwise provide

depth-of-book or depth-of-market information). The

Exchange also believes that the London Stock

Exchange charges $144–$219 per terminal for the

price and size of limit orders in stocks that are

included in the FTSE 250 index. Further, the

Exchange believes that the Toronto Stock Exchange

charges $30 per terminal for its order books.

6The ‘‘window’’ requirement does not literally

require a separate window, only separate displays.

In other words, a vendor could format multiple

displays in a single window.

135b under the Securities Act of 1933.

The amendment will clarify that an

Options Disclosure Document prepared

pursuant to rule 0b–1 under the

Securities Exchange Act of 1934 is not

a prospectus and therefore is not subject

to liability under section 12(a)(2) of the

Exchange Act.

For further information, please

contact Ray Be, Office of Rulemaking,

Division of Corporation Finance, at

(202) 942–2910.

5. The Commission will consider

whether to propose an amendment to

rule 146 under the Securities Act of

1933. The proposed amendment

provides a definition of the term

‘‘qualified purchaser’’ for purposes of

section 18(b)(3) of the Securities Act

and thus posits an additional ‘‘covered

security’’ preempting state securities

registration and review.

For further information, please

contact Marva Simpson, Office of Small

Business Policy, Division of Corporation

Finance, at (202) 942–2950.

At times, changes in Commission

priorities require alternations in the

scheduling of meeting items. For further

information and to ascertain what, if

any, matters have been added, deleted

or postponed, please contact: The Office

of the Secretary at (202) 942–7070.

Dated: December 11, 2001.

Jonathan G. Katz,

Secretary.

[FR Doc. 01–30979 Filed 12–12–01; 11:43

am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

Sunshine Act Meeting

Federal Register Citation of Previous

Announcement: 66 FR 63422, December

6, 2001.

Status: Closed meeting.

Place: 450 Fifth Street, NW.,

Washington, DC

Date and Time of Previously

Announced Meeting: Thursday,

December 13, 2001 at 10:00 a.m.

Change in the Meeting: Time Change.

The closed meeting scheduled for

Thursday, December 13, 2001 at 10 a.m.

has been changed to Friday, December

14, 2001 at 10 a.m.

Dated: December 12, 2001.

Jonathan G. Katz,

Secretary.

[FR Doc. 01–31031 Filed 12–12–01; 4:02 pm]

BILLING CODE 8010–01–P

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–44138; File No. SR–NYSE–

2001–42]

Self-Regulatory Organizations; Order

Approving a Proposed Rule Change by

the New York Stock Exchange, Inc.,

Establishing the Fees for NYSE

OpenBookTM

December 7, 2001.

On October 15, 2001, the New York

Stock Exchange, Inc. (‘‘NYSE’’ or

‘‘Exchange’’) filed with the Securities

and Exchange Commission (‘‘SEC’’ or

‘‘Commission’’), pursuant to Section

19(b)(1) of the Securities Exchange Act

of 1934 (‘‘Act’’),1 and Rule 19b–4

thereunder,2 a proposed rule change

establishing the fees for its NYSE

OpenBook service. The proposed rule

change was published for comment in

the Federal Register on October 29,

2001.3 The Commission received one

comment letter on the proposed rule

change.4 This order approves the

proposed rule change.

I. Description of the Proposed Rule

Change

A. Proposed Fees for NYSE OpenBook

Service

The Exchange proposes to establish

certain fees for its NYSE OpenBook

service. NYSE OpenBook is a

compilation of limit order data that the

Exchange will provide to market data

vendors, broker-dealers, private network

providers, and other entities through a

data feed. According to the Exchange,

for every limit price, NYSE OpenBook

will include the aggregate order volume.

The Exchange will make the NYSE

OpenBook data feed available through

the Exchange’s Common Access Point

(‘‘CAP’’) network. Initially, the

Exchange will update NYSE OpenBook

every ten seconds.

The Exchange has proposed two fees.

First, the Exchange proposes to collect

a fee equal to $5,000 per month from

each entity that elects to receive the

NYSE OpenBook data feed. Second, the

Exchange proposes to collect an enduser fee of $50.00 5 per month for each

terminal through which the end user is

able to display the NYSE OpenBook.

B. NYSE OpenBook Service Agreements

The Exchange will require each NYSE

OpenBook data feed recipient to enter

into the existing form of ‘‘vendor’’

agreement. That agreement will

authorize the data feed recipient to

provide NYSE OpenBook display

services to its customers or to distribute

the data internally. In addition, the

Exchange represents that it will require

each end-user that receives NYSE

OpenBook displays from a vendor or

broker-dealer to execute the existing

‘‘subscriber’’ agreement.

The Exchange intends to supplement

the vendor agreements with additional

terms that are unique to NYSE

OpenBook. First, the vendor agreements

prohibit a data feed recipient that

redisseminates the NYSE OpenBook

outside of its organization from

enhancing, integrating, or consolidating

the redisseminated NYSE OpenBook

data with limit order data of other

markets or trading systems (i.e., the data

feed recipient may only redisseminate

the display of the NYSE’s OpenBook in

a separate ‘‘window’’ 6 marked ‘‘NYSE

OpenBookTM’’). A vendor, however,

may place other markets’ limit order

displays on the same page as the NYSE

OpenBook window. This restriction

only applies to vendors that

redisseminate the NYSE OpenBook

outside of their organization. It does not

apply to those entities that receive the

data feed for their own internal use. In

other words, data feed recipients will be

permitted to enhance, integrate, or

consolidate the NYSE OpenBook data

with other markets’ or trading systems’

limit order data for their own internal

use.

Second, the vendor agreement

precludes a data feed recipient from

retransmitting the NYSE OpenBook data

feed. Thus, any entity that wishes to

receive the data feed so that it may

enhance, integrate, or consolidate the

data with other markets’ data for its own

internal use must obtain the data feed

from the NYSE. The Exchange, however,

64896 Federal Register / Vol. 66, No. 241 / Friday, December 14, 2001 / Notices

7See Schwab Letter, note 4, supra.

8The commenter questioned whether the

restriction on redissemination applied only to the

redissemination of the data feed itself for whether

it was a complete ban on external redistribution of

the OpenBook display. The NYSE clarified that the

restriction on redissemination applied only to the

redissemination of the data feed.

9 In approving this rule, the Commission has

considered its impact on efficiency, competition,

and capital formation. 15 U.S.C. 78c(f). 10 15 U.S.C. 78f(b)(4). 11See note 5, supra. 12For a complete discussion of the relevant

provisions of the Act, see Securities Exchange Act

Release No. 44962 (October 19, 2001), 66 FR 54562

(October 29, 2001). 13 15 U.S.C. 78s(b)(2). 14 17 CFR 200.30–3(a)(12).

has represented that once it and the

marketplace gains experience with the

product, the Exchange will permit

retransmission of the NYSE OpenBook

data feed by vendors.

II. Summary of Comments

The Commission received one

comment letter on the proposal.7

Generally, the commenter supports the

Exchange’s efforts in making its depthof-book information available to

investors as soon as possible. However,

the commenter believes that the fee

structure and the restrictions on how

the NYSE OpenBook data can be used

are unreasonable and unfairly

discriminate against individual retail

investors.

The commenter believes that the

proposed fee structure deprives retail

investors of equal and fair access to the

same type of information as institutions

and professionals because the proposed

end-user fee is prohibitively expensive.

Therefore, the commenter believes that

retail firms, and in particular, firms with

a large online retail client base, are

placed at an unfair competitive

disadvantage to firms that cater to

institutional investors or serve their

clients solely through telephone and inperson service. The commenter also

states that the NYSE did not justify or

attempt to explain the reasonableness of

the $50 per device or end-user fee.

Therefore, without a cost-effective

alternative for retail investors, the

commenter believes that the proposal

does not meet investor protection

standards.

In addition, the commenter states that

the proposal unduly restricts the

availability of critically important

market data on a fair and equal basis.

The commenter believes that the

restrictions on the form and content of

OpenBook would result in retail

investors getting an inferior information

product than would be available to

institutions and professionals because

retail investors would only receive a

one-size-fits-all information product

(i.e., the NYSE OpenBook display), as

opposed to enhanced or consolidated

market information.8

In response to the commenter, the

Exchange stated that the commenter’s

concerns generally focused on the

absence of a retail online fee. The

Exchange argued that as a product

innovator, it was simply exercising its

perogative to roll out NYSE OpenBook

in phases, as dictated by demand.

III. Discussion

After careful review, the Commission

finds that the Exchange’s proposed rule

change to establish fees for NYSE

OpenBook service is consistent with the

requirements of the Act, and the rules

and regulations thereunder applicable to

a national securities exchange.9 In

particular, the Commission finds that

the fee proposal is consistent with

section 6(b)(4) of the Act,10 which

requires that exchange rules provide for

the equitable allocation of reasonable

dues, fees, and other charges among its

members, issuers, and other persons

using its facilities.

Specifically, the Commission believes

that the Exchange’s proposed charges of

$5,000 per month for receipt of the

NYSE OpenBook data feed, and $50 per

month for the end-user fee per terminal

are reasonable when compared to

similar types of service provided by

other markets.11

The Commission considered the

commenter’s concern that the

Exchange’s proposed fees unfairly

discriminate against retail investors.

The Exchange, however, has

represented that as it gains experience

with NYSE OpenBook, it may design a

data product that is more suitable for

use by registered representatives, and

should ademand develop, it would

consider designing a limit order data

product for the retail, nonprofessional

customer.

The Commission notes that this order

only approves the filing submitted by

the NYSE, for the fees for the NYSE

OpenBook service. Therefore, the

Commission is not approving or

disapproving the terms of the NYSE’s

vendor or subscriber agreements. The

NYSE’s proposed restrictions on vendor

redissemination of OpenBook data,

including the prohibition on providing

the full data feed and providing

enhanced, integrated, or consolidated

data found in these agreements are on

their face discriminatory, and may raise

fair access under the Act. 12

IV. Conclusion

It is therefore ordered, pursuant to

section 19(b)(2) of the Act, 13 that the

proposed rule change (SR–NYSE–2001–

42) be, and it hereby is, approved.

For the Commission, by the Division of

Market Regulation, pursuant to the delegated

authority.14

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 01–30879 Filed 12–13–01; 8:45 am]

BILLING CODE 8010–01–M

SMALL BUSINESS ADMINISTRATION

[Declaration of Disaster #3379]

State of Tennessee (and Contiguous

Counties in the State of Arkansas,

Kentucky and Mississippi)

Henry and Shelby Counties and the

contiguous Counties of Benton, Carroll,

Fayette, Stewart, Tipton and Weakley in

the State of Tennessee; Crittenden

County in the State of Arkansas;

Calloway and Graves Counties in the

State of Kentucky; and DeSoto and

Marshall Counties in the State of

Mississippi constitute a disaster area

due to damages caused by tornadoes

and heavy rains that occurred on

November 21, 2001 and continued

through November 30, 2001.

Applications for loans for physical

damage may be filed until the close of

business on February 5, 2002 and for

economic injury until the close of

business on September 6, 2002 at the

address listed below or other locally

announced locations: U.S. Small

Business Administration, Disaster Area

2 Office, One Baltimore Place, Suite

300, Atlanta, GA 30308.

The interest rates are:

Percent

For Physical Damage:

Homeowners With Credit Available Elsewhere ...................... 6.500

Homeowners Without Credit

Available Elsewhere .............. 3.250

Businesses With Credit Available Elsewhere ...................... 8.000

Businesses and Non-Profit Organizations Without Credit

Available Elsewhere .............. 4.000

Others (Including Non-Profit Organizations) With Credit

Available Elsewhere .............. 6.375

For Economic Injury:

Businesses and Small Agricultural Cooperatives Without

Credit Available Elsewhere ... 4.000

The numbers assigned to this disaster

for physical damage are 337912 for

Tennessee; 338012 for Arkansas; 338112

for Kentucky; and 338212 for

Mississippi. For economic injury, the