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Notice

Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the Philadelphia Stock Exchange, Inc. Relating to the Implementation of a Fee with Respect to Certain Individuals Who Work on the Exchange's Trading Floor

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Start Preamble December 27, 2001.

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, 2001, 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 Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

The Exchange proposes to amend its schedule of dues, fees, and charges to adopt a fee of $25 per month to be imposed on member/participant organizations for individuals employed by such member/participant organizations who work on the Exchange's trading floor, but who are not registered as Exchange members or foreign currency options (“FCO”) participants.[3] The Exchange intends to charge member/participant organizations a $25 fee per month for such individuals registered as of the first trading day of the month. The Exchange states that it intends to implement this fee beginning on January 1, 2002.[4]

The text of the proposed rule change is available at the Office of the Secretary, the Phlx, and at the Commission.

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

The Exchange states that the purpose of the proposed rule change is to impose a fee on Exchange member/participant organizations for their employees who are registered to be on the Exchange's trading floor, but are not registered as members or FCO participants. The Exchange states that this fee is intended to help it offset the costs it incurs in registering these individuals.[5]

(2) Statutory Basis

The Exchange believes that the proposed rule change is consistent with section 6(b) of the Act,[6] in general, and furthers the objectives of Section 6(b)(4),[7] in particular, in that it is an equitable allocation of reasonable fees among the Exchange's members because the member/participant organizations who pay the additional, minimal amount for registering their employees incur the benefit of having these employees on the Exchange's trading floor.

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

The Exchange does not believe that the proposed rule change will impose any inappropriate burden on competition.

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

No written comments were either solicited or received.

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

The foregoing rule change establishes or changes a due, fee, or charge imposed by the Exchange and, therefore, has become effective upon filing pursuant to Section 19(b)(A)(ii) of the Act [8] and Rule 19b-4(f)(2) hereunder.[9] At any time within 60 days of the filing of such 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 purpose of the Act. The Exchange has stated that it intends to implement this fee beginning on January 1, 2002.

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. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule Start Printed Page 381change 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 Section. Copies of such filing will also be available for inspection and copying at the principal office of the Exchange. All submissions should refer to File No. SR-Phlx-2001-118 and should be submitted by January 24, 2002.

Start Signature

For the Commission, by the Division of Market Regulation, pursuant to delegated authority.[10]

Margaret H. McFarland,

Deputy Secretary.

End Signature End Preamble

Footnotes

3.  According to the Exchange, individuals registered to be on the Exchange's trading floor, but who are not registered as members or FCO participants, include trading floor personnel such as clerks, interns, stock execution clerks, and other associated persons of member/participant organizations. These individuals are required to be registered with the Exchange Pursuant to Exchange Rule 620(b).

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4.  The Exchange states that this fee will be eligible for the monthly credit of up to $1,000 to be applied against certain fees, dues and charges and other amounts owed to the Exchange by certain members. See Securities Exchange Act Release No. 44292 (May 11, 2001), 66 FR 27715 (May 18, 2001) (SR-Phlx-2001-49).

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5.  According to the Exchange, individuals who are registered as inactive nominees pursuant to Exchange By-Law Article XII, Section 12-10 and Exchange Rule 21 will not be subject to the proposed fee.

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8.  15 U.S.C. 78(s)(b)(3)(A)(ii).

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[FR Doc. 02-75 Filed 1-2-02; 8:45 am]

BILLING CODE 8010-01-M