Document ID: SEC-2007-0487-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Boston Stock Exchange, Inc.
Posted Date: 2007-04-02T04:00Z

[Federal Register: April 2, 2007 (Volume 72, Number 62)]
[Notices]               
[Page 15734-15735]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02ap07-117]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55529; File No. SR-BSE-2007-13]

 
Self-Regulatory Organizations; Boston Stock Exchange, Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend the Existing BeX Fee Schedule

March 26, 2007.
    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 5, 2007, the Boston Stock Exchange, Inc. (``BSE'' 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 substantially prepared by the 
Exchange. The BSE has designated this proposal as one changing a due, 
fee, or other charge under Section 19(b)(3)(A)(ii) of the Act \3\ and 
Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal 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\ 1 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 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 BSE proposes to amend the Boston Equities Exchange (``BeX'') 
fee schedule to include a smart order routing fee to be charged to BSE 
Members where a third-party broker-dealer serves as the ``give-up'' on 
an away Trading Center when the Member on whose behalf the order is 
being routed is not also a member of the away Trading Center. The text 
of the proposed rule change is available at http://www.bostonstock.com, at the 

BSE, 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 Exchange 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 Exchange 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
    On November 20, 2006, the BSE filed File No. SR-BSE-2006-44, a rule 
filing that amended the existing BSE fee schedule and established a fee 
schedule for the BeX, a facility of the Exchange. File No. SR-BSE-2006-
44 resulted in, among other things, the deletion of all Transaction 
Fees, Electronic File Access and Processing Fees, and Floor Operation 
Fees from the BSE fee schedule. The Transaction Fees and Electronic 
File Access and Processing Fees that were deleted from the BSE fee 
schedule were transferred to the BeX fee schedule. In addition to the 
transfer of existing fees from the BSE fee schedule

[[Page 15735]]

to the BeX fee schedule, certain new fees were added to the BeX fee 
schedule. For example, BeX now charges a smart order routing fee of 
$0.0010 per 100 shares. The purpose of the instant proposed rule change 
is to update the BeX fee schedule to reflect a new smart order routing 
fee that will be charged to Members when the Member on whose behalf an 
order is routed is not also a member or subscriber of the away Trading 
Center and, as a result, must utilize the ``give-up'' services provided 
through the Exchange.
    As described in Chapter XXXVIII, Section 3 of the Exchange's Rules, 
the Exchange will route orders to other Trading Center under certain 
circumstances (``Routing Services''). The Exchange provides its Routing 
Services pursuant to the terms of three separate agreements: (1) An 
agreement between the Exchange and each Member on whose behalf orders 
will be routed (``Member-Exchange Agreement''); (2) an agreement 
between the Exchange and each third-party broker-dealer that will serve 
as a ``give-up'' on an away Trading Center when the Member on whose 
behalf an order is routed is not also a member or subscriber of the 
away Trading Center (``Give-Up Agreement''); and (3) an agreement 
between the Exchange and a third-party service provider (``Technology 
Provider'') pursuant to which the Exchange licenses the routing 
technology used by the Exchange for its Routing Services (``Exchange-
Technology Provider Agreement'').
    The new smart order routing fee being added to the BeX fee schedule 
relates to the second scenario set forth above, where a third-party 
broker-dealer serves as the ``give-up'' on an away Trading Center when 
the Member on whose behalf the order is being routed is not also a 
member of the away Trading Center. The new fee is called the ``Smart 
order routing using BeX provided give-up'' fee and the charge is 
$0.0050 per 100 shares.\5\
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    \5\ The Exchange represents that the new fee of $0.0050 per 100 
shares will be charged in lieu of, and not in addition to, the 
currently existing ``Smart order routing'' fee of $0.0010 per 100 
shares for those orders using a BeX-provided give-up. Telephone 
conversation between Brian Donnelly, Assistant Vice President, 
Regulation and Compliance, BSE, and David Michehl, Special Counsel, 
Division of Market Regulation, Commission, on March 19, 2007.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the requirements of Section 6(b) of the Act,\6\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act,\7\ in 
particular, in that it is designed to provide for the equitable 
allocation of reasonable dues, fees and other charges among Exchange 
members and issuers and other persons using Exchange facilities.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 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 Exchange 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 proposed rule change has been designated as a fee 
change pursuant to Section 19(b)(3)(A)(ii) of the Act \8\ and Rule 19b-
4(f)(2) thereunder,\9\ because it establishes or changes a due, fee or 
other charge imposed by the Exchange. Accordingly, the proposal will 
take effect upon filing with the Commission.
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    \8\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \9\ 17 CFR 240.19b-4(f)(2).
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    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-BSE-2007-13 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 Number SR-BSE-2007-13. 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 also will be available for inspection and copying at the 
principal office of the BSE. 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-BSE-2007-13 and should be submitted on or before April 
23, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-5963 Filed 3-30-07; 8:45 am]

BILLING CODE 8010-01-P