Document ID: SEC-2006-0512-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Philadelphia Stock Exchange, Inc.
Posted Date: 2006-04-19T04:00Z

[Federal Register: April 19, 2006 (Volume 71, Number 75)]
[Notices]               
[Page 20151-20152]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr19ap06-148]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53643; File No. SR-Phlx-2006-23]

 
Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto to Amend the Fees Related to Off-Floor 
Traders

April 13, 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 March 31, 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. On April 12, 
2006, the Phlx filed Amendment No. 1 to the proposed rule change.\3\ 
The Phlx filed the proposal pursuant to Section 19(b)(3)(A)(ii) of the 
Act \4 \ and Rule 19b-4(f)(2) thereunder,\5\ which renders the proposal 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change, as 
amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No.1, the Exchange made non-substantive, 
technical changes to the proposed rule text and clarified the 
purpose of the proposal.
    \4\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \5\ 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 Phlx proposes to: (1) Eliminate the Exchange's off-floor trader 
annual fee of $350.00; (2) eliminate the Exchange's off-floor trader 
initial registration fee of $100.00; and (3) adopt a monthly off-floor 
examination fee of $30.00 per off-floor trader for off-floor traders 
associated with member organizations for whom the Exchange is the 
Designated Examining Authority (``DEA'').\6\ The text of the proposed 
rule change is below. Proposed new language is in italics; proposed 
deletions are in [brackets].
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    \6\ Every person who is compensated directly or indirectly by a 
member or participant organization for which the Exchange is the 
DEA, or any other associated person of such member or participant 
organization, and who executes, makes trading decisions with respect 
to, or otherwise engages in proprietary or agency trading of 
securities, including, but not limited to, equities, preferred 
securities, convertible debt securities or options off the floor of 
the Exchange (``off-floor traders''), must successfully complete the 
Uniform Registered Representative Examination Series 7. See Phlx 
Rule 604(e)(i).
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* * * * *
Appendix A
* * * * *

Off-Floor Examinations Fee--$30.00 monthly per Off-Floor Trader
[Off-Floor Trader Initial Registration Fee--$100.00]
[Off-Floor Trader Annual Fee--$350.00]

* * * * *

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 proposed rule change. 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 adopting the monthly off-floor examination fee is to 
continue to help off-set the Exchange's costs associated with 
conducting examinations and routine financial condition monitoring of 
member organizations that do not necessarily

[[Page 20152]]

generate off-setting revenue for the Exchange or send orders to the 
Exchange. The Exchange also incurs administrative costs, such as costs 
incurred in conducting reviews of individuals with prior disciplinary 
history. Replacing the initial off-floor trader registration fee and 
the annual off-floor trader fee with a monthly off-floor examination 
fee allows the Exchange to bill member organizations in monthly 
increments, which should more closely align the number of off-floor 
traders that are registered with the Exchange with the fee being 
charged. Replacing such fees with the proposed monthly off-floor 
examination fee should therefore allow the Exchange to more accurately 
charge those applicable off-floor traders and help off-set those costs 
associated with such examinations, monitoring, and reviews. This 
proposal is scheduled to become effective on April 1, 2006.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the requirements of Section 6(b) of the Act,\7\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act,\8\ in 
particular, because it is designed to provide for the equitable 
allocation of reasonable dues, fees, and other charges among members of 
the Exchange.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
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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

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

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 \9\ and Rule 19b-
4(f)(2) \10\ thereunder. Accordingly, the proposed rule change is 
effective upon filing with the Commission. 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.\11\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \10\ 17 CFR 240.19b-4(f)(2).
    \11\ The effective date of the original proposed rule change is 
March 31, 2006, and the effective date of Amendment No. 1 is April 
12, 2006. For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change under 
Section 19(b)(3)(C) of the Act, the Commission considers such period 
to commence on April 12, 2006, the date on which the Exchange filed 
Amendment No. 1. See 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, as amended, 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 No. SR-Phlx-2006-23 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090. All submissions should refer to 
File No. SR-Phlx-2006-23. 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. Copies of such filing will also 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 No. SR-Phlx-2006-23 and should be 
submitted on or before May 10, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. E6-5854 Filed 4-18-06; 8:45 am]

BILLING CODE 8010-01-P