Document ID: SEC-2006-0141-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Philadelphia Stock Exchange, Inc.
Posted Date: 2006-02-07T05:00Z

[Federal Register: February 7, 2006 (Volume 71, Number 25)]
[Notices]               
[Page 6305-6307]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07fe06-69]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53197; File No. SR-Phlx-2006-08]

 
Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to Exchange Rule 715

January 31, 2006.
    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 26, 2006, the Philadelphia Stock Exchange, Inc. (``Phlx'' or 
``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 prepared by the Phlx. The Phlx 
filed the proposed rule change pursuant to Section 19(b)(3)(A) of the

[[Page 6306]]

Act \3\ and Rule 19b-4(f)(1) thereunder,\4\ and consequently the 
proposal was effective upon filing with the Commission. 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).
    \4\ 17 CFR 240.19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Phlx proposes to amend Exchange Rule 715, Monthly Payment and 
Reporting, to clarify that equity floor members are no longer required 
to submit a monthly report of net commissions on transactions effected 
on the floor of the Exchange. Exchange Rule 715 is set forth below, 
with new text italicized:
Rule 715
Monthly Payment and Reporting
    (a) Each member and member organization shall submit to the 
Exchange's Controller, in such form as the Exchange may prescribe, a 
monthly report of net commissions on transactions, other than equity 
transactions, effected on the Floor of the Exchange during the 
preceding month together with a check payable to the Exchange for the 
appropriate fee. Said reports and fees must be received by the Exchange 
on or before the 28th calendar day following the month covered by the 
report, unless the Exchange is not open for business on such day, in 
which event the report is to be filed and the fees are to be paid on 
the next business day.
    (b) A member or member organization may, in writing, request that 
the Controller grant an extension of not more than five business days 
to file such reports or pay such fees. The Controller has the 
discretion to grant or deny such extension requests.
* * * * *

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 Phlx included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received on the proposal. The text of these 
statements may be examined at the places specified in Item IV below. 
The Phlx 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 purpose of amending Exchange Rule 715 is to update this rule to 
reflect that monthly reports of net commissions are no longer required 
to be submitted in connection with equity transactions. This 
clarification should help avoid any member confusion as it relates to 
the floor brokerage assessment. No fee changes are being made pursuant 
to this proposal.
    Previously, the Exchange adopted a monthly fee of $250 for each 
member who derives his/her primary income from floor brokerage business 
conducted on the equity floor of the Exchange and eliminated the equity 
floor brokerage assessment fee of five percent of net floor brokerage 
income.\5\ The Exchange waived the equity floor brokerage assessment 
and implemented the flat monthly fee of $250 to encourage floor brokers 
to send additional order flow to the Exchange and to simplify Phlx 
accounting procedures and billing. Thus, because the equity floor 
brokerage assessment is no longer based on net commissions, equity 
floor members do not need to submit monthly reports of net commissions, 
as required by Exchange Rule 715. Equity option and index option 
members and foreign currency participants, however, are still required 
to submit monthly reports because their floor brokerage assessment 
continues to be imposed based on monthly net floor brokerage income.
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    \5\ See Securities Exchange Act Release No. 49057 (January 12, 
2004), 69 FR 2808 (January 20, 2004) (SR-Phlx-2003-83).
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \6\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \7\ in particular, in that it should help to foster 
cooperation and coordination with persons engaged in the regulating, 
clearing, settling, processing information with respect to and 
facilitating transactions in securities by clarifying that a floor 
brokerage assessment form is not required to be completed in connection 
with the assessment of the flat monthly fee of $250.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Phlx believes that the proposed rule change will not impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act, as amended.

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

    The Phlx has neither solicited nor received comments on the 
proposed rule change.

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

    The foregoing rule change has become effective upon filing pursuant 
to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(1) thereunder 
\9\ because it constitutes a stated policy, practice or interpretation 
with respect to the meaning, administration, or enforcement of an 
existing rule. 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.\10\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(1).
    \10\ See Section 19(b)(3)(C), 15 U.S.C. 78s(b)(3)(C).
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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. 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-Phlx-2006-08 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

    All submissions should refer to File Number SR-Phlx-2006-08. 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

[[Page 6307]]

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. Copies of such filing also will be available for 
inspection and copying at the principal office of the Phlx. 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-Phlx-2006-08 and should be 
submitted on or before February 28, 2006.
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    \11\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
Nancy M. Morris,
Secretary.
[FR Doc. E6-1613 Filed 2-6-06; 8:45 am]

BILLING CODE 8010-01-P