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Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Revise the Equities and Exchange Traded Fund Shares (“ETFs”) Fee Schedule
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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 September 29, 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. The Exchange designated the proposed rule change as one establishing or changing a due, fee, or other charge, 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. 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 revise the equities and Exchange Traded Fund Shares (“ETFs”) Fee Schedule to provide for various fees related to the routing of orders to other market centers.
The text of the proposed change is available on Amex's Web site at
http://www.amex.com,
at the principal office of Amex, 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 Amex 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 the Statutory Basis for, the Proposed Rule Change
1. Purpose
On July 17, 2006, the Amex, the Boston Stock Exchange, Inc., the Chicago Board Options Exchange, Inc., the Chicago Stock Exchange, Inc., the Nasdaq Stock Market LLC, the National Stock Exchange, the New York Stock Exchange LLC, and the NYSE Arca, Inc., executed and filed with the Commission a “Plan for the Purpose of Creating and Operating an Intermarket Communications Linkage Pursuant to Section 11A(a)(3)(B) of the Act. The Philadelphia Stock Exchange, Inc. (“Phlx”) subsequently executed the
( printed page 65847)
Linkage Plan on August 1, 2006.[5]
This “Linkage Plan” was filed with the Commission pursuant to Rule 608 of Regulation NMS under the Act.[6]
The purpose of the proposed Linkage Plan is to enable the Plan Participants to act jointly in planning, developing, operating and regulating the NMS Linkage System (“Linkage”) that will electronically link the Linkage Plan Participant Markets to one another, as described in the Linkage Plan. The Linkage Plan became operative on October 1, 2006.
Historically, ITS Participants have not imposed transaction charges for executions of commitments delivered through ITS, although the ITS Plan does not prohibit such charges. Under the Linkage Plan, each Participant is accessed through its own members and could charge for orders executed in their market through the Linkage. Therefore, the Exchange now proposes to amend its Fee Schedule to provide: (1) For transactions resulting from equities and ETF orders routed through the Linkage to the Amex, members will be assessed a transaction charge based on the transaction charges currently in place for transactions resulting from other orders; and (2) for transactions resulting from equities and ETF orders routed through the Linkage to an away market, the Amex will pass through to its members fees charged by the other market centers for such transactions.[7]
To determine the amount of these fees members will need to consult the fee schedules published by each market center. It is anticipated that, at least initially the transaction charges imposed by other market centers for the execution of orders routed to them through the Linkage will be the same as the transaction charges imposed on executions of orders for their own members.
2. Statutory Basis
The Exchange believes that its proposal to revise its schedule of fees is consistent with Section 6(b) of the Act [8]
in general, and furthers the objectives of Section 6(b)(4) of the Act [9]
in particular, in that it is an equitable allocation of reasonable dues, fees and other charges among its members and issuers and other persons using its facilities. Specifically, the Exchange is proposing to establish transaction charges for order routed to the Amex through the Linkage and pass through charges assessed by other market centers for orders routed from the Amex through the Linkage.
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
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 rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act [10]
and subparagraph (f)(2) of Rule 19b-4 thereunder.[11]
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 the 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:
Send an e-mail torule-comments@sec.gov. Please include File Number SR-Amex-2006-93 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington DC 20549-1090.
All submissions should refer to File Number SR-Amex-2006-93. 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 Room. Copies of the filing also will be available for inspection and copying at the principal office of the 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-2006-93 and should be
submitted on or before November 30, 2006.
November 2, 2006.
For the Commission by the Division of Market Regulation, pursuant to delegated authority.12