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Notice

Self-Regulatory Organizations; Stock Clearing Corporation of Philadelphia; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Fees for Remote Competing Specialists for Odd-Lot Trades

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Start Preamble August 5, 2003.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),[1] notice is hereby given that on March 28, 2003, the Stock Clearing Corporation of Philadelphia (“SCCP”) 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 primarily by SCCP. The Commission is publishing this notice to solicit comments on the proposed rule change from interested parties.

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

The proposed rule change amends SCCP's fee schedule to reduce the “SCCP transaction charge (remote competing specialists only)” as it applies to odd-lot trades.

II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule

In its filing with the Commission, SCCP included statements concerning the purpose of and statutory basis for the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. SCCP has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of such statements.[2]

A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change

The proposed rule change amends SCCP's schedule of dues, fees, and charges to reduce the amount of the “SCCP transaction charge (remote competing specialists only)” as it applies to odd-lot trades from $0.30 to $0.10 per trade side. The SCCP transaction charge applicable to round lot trades will remain at $0.30 per trade side.[3] The combination of these fees remains capped at $100,000 per month.[4]

SCCP states that the purpose of the proposed rule change is to encourage odd-lot business by reducing the SCCP transaction charge as it applies to odd-lot trades. Currently, the “SCCP transaction charge (remote competing specialists only)” is $0.30 per trade side capped at $100,000 per month without regard to size or type. This fee reduction is intended to provide an incentive for remote competing specialists to continue to trade odd-lots in addition to their regular businesses. SCCP believes that the proposed fee reduction will encourage these smaller trades as well as regular trades thereby enhancing SCCP's business and liquidity in the marketplace.

SCCP believes that the proposed rule change is consistent with 17A(b)(3)(D) of the Act [5] which requires that the rules of a registered clearing agency provide for equitable allocation of reasonable dues, fees, and other charges for services which it provides to its participants because the fee structure proposed herein applies equally to all SCCP participants with remote competing specialist operations or which clear for remote competing specialists.

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

SCCP 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

Because the foregoing rule change establishes or changes a due, fee, or other charge imposed by SCCP, it has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act [6] and Rule 19b-4(f)(2) thereunder.[7] At any time within sixty 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. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Comments may also be submitted electronically at the following e-mail address: rule-comments@sec.gov. All comment letters should refer to File No. SR-SCCP-2003-03. This file number should be included on the subject line if e-mail is used. To help us process and review comments more efficiently, comments should be sent in hardcopy or by e-mail but not by both methods. 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 Section, 450 Fifth Street, NW., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of SCCP.

Start Signature
Start Printed Page 48437

For the Commission by the Division of Market Regulation, pursuant to delegated authority.[8]

Margaret H. McFarland,

Deputy Secretary.

End Signature End Preamble

Footnotes

2.  The Commission has modified parts of these statements.

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3.  For purposes of this fee, an odd-lot is defined as a trade under 100 shares, whereas a round lot is defined as a trade of 100 shares or more and includes partial round lots (for example, 125 shares).

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4.  This proposal is scheduled to become effective for transactions clearing on or after April 2, 2003.

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5.  15 U.S.C. 78q-1(b)(3)(D).

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6.  15 U.S.C. 78s(b)(3)(A)(ii).

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[FR Doc. 03-20545 Filed 8-12-03; 8:45 am]

BILLING CODE 8010-01-P