Document ID: SEC-2009-0292-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Alternext US, LLC
Posted Date: 2009-03-06T05:00Z

[Federal Register: March 6, 2009 (Volume 74, Number 43)]
[Notices]               
[Page 9857-9859]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06mr09-68]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59478; File No. SR-NYSEALTR-2009-19]

 
Self-Regulatory Organizations; NYSE Alternext US, LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Amending 
Schedule of Fees and Charges for Exchange Services

February 27, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on February 27, 2009, NYSE Alternext US, LLC (``NYSE Amex 
Options'', ``NYSE Amex'', or the ``Exchange'') filed with the 
Securities and Exchange Commission (the ``Commission'') the proposed 
rule change as described in Items I, II, and III below, which Items 
have been substantially prepared by the self-regulatory organization. 
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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Schedule of Fees and Charges for 
Exchange Services. The text of the proposed rule change is available on 
the Exchange's Web site at http://www.nyse.com, at the Exchange's 
principal office and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the self-regulatory organization 
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 those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries,

[[Page 9858]]

set forth in sections A, B, and C below, of the most significant parts 
of such statements.

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

1. Purpose
    In conjunction with the migration of the NYSE Amex Options trading 
floor from 86 Trinity Place to the NYSE facility at 11 Wall Street, 
NYSE Amex Options is proposing to introduce a new Schedule of Fees and 
Charges for Exchange Services (``Fee Schedule''). The new Fee Schedule 
will become operative on the first day of trading on the new NYSE Amex 
Options trading floor at 11 Wall Street, currently scheduled for March 
2, 2009. The Exchange proposes deleting the current NYSE Amex Options 
Price List in its entirety and replacing it with the Fee Schedule. The 
proposed fees are generally lower than the current charges, and are 
allocated equitably to all similarly situated members. A more detailed 
description of the proposed changes follows.
ATP Trading Participant Rights
    The Exchange proposes charging Floor Brokers, Order Routing firms 
and Clearing firms $500.00 per month for trading rights on NYSE Amex 
Options. Prior to the merger with NYSE Euronext on October 1, 2008, 
participation charges on the American Stock Exchange (``Amex'') were 
based on the cost of a seat membership or seat lease plus additional 
fees for electronic access and/or access to the trading floor. The 
Exchange proposes significant reductions to the previous charges for 
participation. Market Makers will be charged $1,000.00 per month based 
on the maximum number of ATPs held by an ATP Holder during the calendar 
month. The Exchange also proposes charging $125.00 per month for all 
registered floor personnel that do not pay an ATP fee. Specialists, e-
Specialists, and Directed Order Market Makers (``DOMM'') will be 
charged a monthly fee ranging from $150.00 to $3000.00 based on the 
average number of national daily customer contracts executed and 
prorated according to Specialist, e-Specialist and DOMM volumes in that 
issue.
Options Issue Transfer Fee
    The Exchange proposes charging $100.00 per issue charged to the 
Specialist that transfers an issue to another Specialist.
Options Orientation Fee
    The Exchange proposes a $500.00 Options Orientation Fee. This fee 
covers the full background investigation, disclosure review, and 
fingerprinting fee for each individual applicant, along with the 
administration and maintenance costs associated with the qualification 
exams.
Registration Fees
    The Exchange proposes only presentation changes to the Registration 
Fees section of the Fee Schedule. All fees in this section are 
identical to the fees currently charged and posted on the NYSE Amex 
Options Price List. Registration fees will continue to be waived 
through June 30, 2009 for NYSE member organizations that automatically 
became member organizations of NYSE Alternext U.S. by operation of NYSE 
Alternext Equities Rule 2 at the time of relocation of all NYSE 
Alternext equities trading to the to the NYSE trading facilities and 
systems located at 11 Wall Street.
DEA Fees
    The Exchange proposes the following fees for firms for which the 
Exchange is the Designated Examining Authority (``DEA''). A $1,000 
monthly fee charged to clearing firms engaging in a public business. An 
exemption from this fee will be granted to any NYSE Amex Options 
registered Floor Broker or Market Maker that effects at least 25% of 
all options transactions, as measured in contract volume, on any 
options trading facility of NYSE Alternext US, LLC. The Exchange 
proposes charging $275.00 per quarter to firms not engaging in a public 
business, and $250.00 annually per trader. An exemption from the 
$250.00 annual fee per trader will be granted to any NYSE Amex Options 
registered Floor Broker or Market Maker that effects [0]at least 25% of 
all options transactions, as measured in contract volume, on any 
options trading facility of NYSE Alternext US, LLC. The Exchange also 
proposes a new Regulatory Fee of $100 charged annually for FOCUS 
filings to ATP Firms for which the Exchange is the DEA. Previously, the 
Exchange based its DEA fees on a complicated calculation that charged 
$.00040 per dollar gross per quarterly or annual FOCUS report. The 
Exchange believes this new DEA fee structure significantly simplifies 
the existing fee structure.
Statutory Disqualification Fees
    The Exchange proposes a $2,000 fee for applications resulting in 
statutory disqualification proceedings.
Trade Related Charges
    Options per contract transaction charges will reflect the following 
rate schedule:

------------------------------------------------------------------------
                                                               Rate per
                         Order type                            contract
------------------------------------------------------------------------
Specialists, eSpecialists..................................        $0.10
NYSE Amex Options Market Maker--Non Directed...............         0.17
NYSE Amex Options Market Maker--Directed...................         0.15
Broker Dealer & Firm Electronic............................         0.50
Broker Dealer & Firm Manual................................         0.26
Non BD Customer Electronic.................................         0.00
Non BD Customer Manual.....................................         0.00
Firm Facilitation--Manual..................................         0.15
------------------------------------------------------------------------

    The Firm Facilitation fee applies to any transaction involving a 
firm proprietary trading account, that has a customer of that same Firm 
on the contra side of the transaction.
    At this time the Exchange will not charge a cancellation fee. The 
Exchange intends to charge a cancellation fee in the future via a 
separate rule filing.
    The Exchange proposes a limit of fees on options strategy 
executions. A $750 cap will be applied on transaction fees for strategy 
executions involving (a) reversals and conversions, (b) dividend 
spreads, (c) box spreads, (d) short stock interest spreads, and (e) 
merger spreads. The cap applies to each Strategy Execution executed on 
the same trading day in the same option class. Transaction fees for 
strategy executions are further capped at $25,000.00 per month per 
initiating firm. All Royalty Fees associated with strategy executions 
on index and exchange traded funds will be passed through to trading 
participants on the strategy executions on a pro-rata basis. These 
Royalty Fees will not be included in the calculation of the $750 per 
trade cap or the $25,000 per month strategy fee cap.
    The Exchange proposes a Marketing Charge of $0.65 per contract side 
on transactions in non Penny Pilot issues where Market Makers trade 
against all electronic customer orders, and $0.25 per contract side on 
transactions in Penny Pilot issues where Market Makers trade against 
all electronic customer orders. This fee is collected only on 
electronic customer orders that are executed against a market maker on 
the contra side. This fee represents a pass-through fee for payment for 
order flow. The Exchange collects the Marketing Fee from the ATP Holder 
and passes it through to the Specialist, e-Specialist, or Directed 
Market Maker for distribution to order flow providers.
    The Exchange proposes Royalty Fees reflected in the following 
schedule:

[[Page 9859]]

MNX, NDX.......................................................    $0.16
Russell 2000 Index (RUT).......................................     0.15
ISE FX--Foreign Currency Options...............................     0.10
(BPX, CDD, EUI, YUK, AUX, SFC).................................
All other premium products, ETFs...............................     0.00

    Royalty Fees will be assessed on a per contract basis for firm, 
broker/dealer, and Market Maker transactions. Customer volumes will not 
be subject to any royalty fees, license fees or premium product fees of 
any type. These fees will not be assessed on the customer side of 
transactions. Royalty Fees apply to Linkage Orders except for 
Satisfaction Orders.
Floor and Equipment Fees
    The Exchange proposes charging a Floor Broker Hand Held fee of 
$450.00 per device per month. Hand Held devices are used by Floor 
Brokers in open outcry trading for order entry and order management.
    The Exchange proposes charging a Floor Market Maker Podium Fee of 
$90.00 per Podium per month for each Market Maker. A Podium is a table 
top space provided to a Market Maker on the floor.
    The Exchange proposes a Floor Booth fee of $150.00 per month. Floor 
Booths are designated space used by Floor Brokers. Previously, an 
annual fee of $3,500.00 was charged for a Regular Floor Booth, 
$4,500.00 for a Standard Floor Booth, $6,000 for a Large Floor Booth, 
and $7,000.00 for a Machine Floor Booth.
    The Exchange proposes charging a Telephone Service Charge of $0.16 
on toll calls billed by vendor of less than $0.69, and $0.26 on toll 
calls of greater than or equal to $0.69.
    The Exchange proposes a Cellular Phone fee of $20.00 per month plus 
the cost of the calling plan of the user's choice.
    The Exchange proposes a Booth Telephone System Line Charge of 
$33.33 per phone number per month, and a $10.75 charge per month for a 
single line phone jack and data jack.

Connectivity Charges

    The Exchange proposes Transport Charges of $150 per month per floor 
participant connection as required. This fee will be capped at $500 per 
month per floor broker firm. The Transport Charge is designed to cover 
the cost to the Exchange for installing network cabling and rack space 
for outside data lines, along with the costs of maintaining the data 
center and hub for the Exchange floor.
    The Exchange proposes a Login Fee of $150 per month per Exchange 
sponsored broker dealer entry system. The Login Fee is designed to 
cover the cost per login charged by data vendors for access to the 
Floor Broker order capture system.

Report Fees

    The Exchange proposes a User Activity Extract Fee of $0.0075 per 
trade for clearing data. This fee is in addition to any report 
development and set-up costs. The Exchange also proposes a $500 per 
month Online Data Extract fee that allows unlimited access and 
downloads of clearing data.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section 
6(b) of the Act, in general, and Section 6(b)(4), in particular, in 
that it provides for the equitable allocation of dues, fees and other 
charges among its members and other market participants that use the 
trading facilities of NYSE Amex Options. Under this proposal, all 
similarly situated members and other Exchange participants of NYSE Amex 
Options will be charged the same reasonable dues, fees and other 
charges.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    The proposed rule change is effective upon filing pursuant to 
Section 19(b)(3)(A)(ii) of the Act and SEC Rule 19b-4(f)(2) thereunder 
in that it establishes or changes a due, fee, or other charge imposed 
only on members 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

    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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEALTR-2009-19 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Commission, 100 F Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEALTR-2009-19. 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 (http://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 on official 
business days between the hours of 10 a.m. and 3 p.m. 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-NYSEALTR-2009-19 and should be submitted on or before 
March 27, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\4\
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    \4\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-4785 Filed 3-5-09; 8:45 am]

BILLING CODE 8011-01-P