Document ID: SEC-2007-0116-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: American Stock Exchange LLC
Posted Date: 2007-01-25T05:00Z

[Federal Register: January 25, 2007 (Volume 72, Number 16)]
[Notices]               
[Page 3447-3448]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr25ja07-83]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55122; File No. SR-Amex-2006-116]

 
Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
and Amendment No. 1 Thereto Amending Associate Member Fees

January 18, 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 December 19, 2006, the American Stock Exchange LLC (``Amex'' 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. Amex has designated this proposal as one establishing or 
changing a due, fee, or other charge imposed by a self-regulatory 
organization pursuant to 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. On January 16, 2007, the Exchange 
submitted Amendment No. 1 to the proposed rule change.\5\ 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\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
    \5\ In Amendment No. 1, the Exchange made clean-up changes to 
its proposed rule text and added text to its discussion section.
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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 Amex's Member Fees to eliminate the 
Associate Members' Initiation Fee and the Financial Regulation Fee, to 
reduce the Electronic Access Fee paid by Associate Members, and to 
increase the Associate Member Nominee initiation fee of $1,500 
currently charged to $2,000 and re-designate such fee as an application 
fee (in order to conform this fee to the application fee charged to all 
members).
    The text of the proposed rule change is available on the Exchange's 
Web site (http://www.amex.com/atamex/ruleFilings/2006/SR_Amex_2006_116_initial.pdf
), 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 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
    Amex currently charges a one-time initiation fee (the ``Initiation 
Fee'') to Associate Members that is equivalent to 5% of the price of 
the last completed regular membership sold. The Exchange proposes to 
eliminate this Initiation Fee, which has become disproportionate to the 
cost of other types of seat-based, Regular, Option Principal, and 
Limited Trading Permit Memberships. The Exchange believes that the 
Initiation Fee may act as a deterrent for firms seeking to apply for 
membership.
    Associate Members are also currently required to pay a financial 
regulation fee (``Financial Regulation Fee'') which is imposed in 
instances where the Exchange is the Designated Examining Authority ( 
``DEA''). This fee may be waived by demonstrating to the Exchange's 
Financial Regulatory Services Department that 10% of the firm's volume 
is transacted on the floor of the Exchange. The Financial Regulation 
Fee is $4,000 a month for associate member firms and $3,000 annually 
for individual Associate Members. The Exchange submits that this fee 
does not generate significant income, and further acts as an impediment 
to expanding Associate Memberships. Associate Members, however, will 
continue to be subject to Regulatory Fees that are applicable to all 
members, as set forth in the Exchange's Examination Fees section of the 
Member Fees.
    The Exchange is also proposing to reduce the current Electronic 
Access Fee from $30,000 to $15,000, to reflect the current prices of 
seats and the prices to lease a seat.
    The Exchange notes that Associate Member firms will continue to be 
subject to Annual Membership dues of $1,500. In addition, the Exchange 
proposes to amend the Amex Constitution to charge Nominees of Associate 
Firms a $2,000 Application Processing fee to replace the Initiation Fee 
of $1,500. A $2,000 Application Processing fee is currently charged to 
all Members.
    The Exchange believes that elimination of the Initiation Fee and 
the Financial Regulation Fee and the reduction of the Electronic Access 
Fee will help to adjust an imbalance in membership costs, and encourage 
firms to utilize this type of Membership. The Exchange represents that 
the foregoing fee adjustments will accordingly place the Associate 
Member status on a comparable level with the cost of floor memberships.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
1934 Act,\6\ in general, and furthers the objectives of Section 
6(b)(4),\7\ in particular, in that it is designed to provide for the 
equitable allocation of reasonable dues, fees, and other charges among 
its members and issuers and other persons using facilities. The 
Exchange asserts that the proposal is equitable as required by Section 
6(b)(4) of the Act in that it places Associate Member Fees on the same 
level as Regular, Option Principal, and Limited Trading Permit 
Memberships.
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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.

[[Page 3448]]

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 foregoing proposed rule change has become effective 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. 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)(ii).
    \9\ 17 CFR 19b-4(f)(2).
    \10\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change, the 
Commission considers the period to commence on January 16, 2007, the 
date on which the Exchange filed Amendment No. 1.
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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 No. SR-Amex-2006-116 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-Amex-2006-116. 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 Commissions 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 the filing also will be 
available for inspection and copying at the principal office of Amex. 
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-Amex-2006-116 
and should be submitted on or before February 15, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-1110 Filed 1-24-07; 8:45 am]

BILLING CODE 8011-01-P