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48454 Federal Register / Vol. 70, No.

158 / Wednesday, August 17, 2005 / Notices

SECURITIES AND EXCHANGE of the license. However, because surcharge fee to all applicable
COMMISSION competitive pressures in the industry transactions occurring between January
have resulted in the waiver of 10, 2005 and May 19, 2005 is equitable
[Release No. 34–52237; File No. SR–ISE–
2005–28]
transaction fees for Public Customers,6 in order to defray ISE’s licensing costs.
the Exchange proposes to exclude It is therefore ordered, pursuant to
Self-Regulatory Organizations; Public Customer Orders7 from this Section 19(b)(2) of the Act,13 that the
International Securities Exchange, Inc.; surcharge fee. Accordingly, this proposed rule change (File No. SR–ISE–
Order Granting Approval of a surcharge fee will only be charged to 2005–28), as amended, is approved.
Proposed Rule Change and Exchange members with respect to non- For the Commission, by the Division of
Amendment No. 1 Thereto Relating to Public Customer Orders (e.g., Market Market Regulation, pursuant to delegated
Fee Changes for Transactions in Maker and Firm Proprietary orders) and authority.14
Options on the Standard & Poor’s shall apply to Linkage Orders under a Margaret H. McFarland,
Depository Receipts on a Retroactive pilot program that is set to expire on Deputy Secretary.
Basis July 31, 2006.8
Additionally, the Commission notes [FR Doc. E5–4462 Filed 8–16–05; 8:45 am]
August 10, 2005. that the Exchange has represented that, BILLING CODE 8010–01–P

On May 20, 2005, the International if it is concluded by the courts after all
Securities Exchange, Inc. (‘‘ISE’’ or avenues of appeal that no license from
‘‘Exchange’’) filed with the Securities Standard and Poor’s was required by the SECURITIES AND EXCHANGE
and Exchange Commission Exchange to list SPDR options, then COMMISSION
(‘‘Commission’’), pursuant to Section upon any refund by Standard and Poor’s
19(b)(1) of the Securities Exchange Act [Release No. 34–52238; File No. SR–PCX–
to the ISE, the Exchange shall submit a
2005–89]
of 1934 (‘‘Act’’)1 and Rule 19b-4 rule filing to the Commission providing
thereunder,2 a proposed rule change to for a reimbursement of the fees paid by Self-Regulatory Organizations; Pacific
retroactively establish, as of January 10, members to the Exchange as a result of Exchange, Inc.; Notice of Filing and
2005, a $.10 per contract surcharge fee this surcharge. Immediate Effectiveness of Proposed
for certain transactions in options based The Commission finds that the Rule Change To Amend the Market
on the Standard & Poor’s Depository proposed rule change is consistent with Maker Fee
Receipts, or SPDRs (‘‘SPDRs’’).3 On the requirements of the Act and the
June 15, 2005, the Exchange filed rules and regulations thereunder August 10, 2005.
Amendment No. 1 to the proposed rule applicable to a national securities Pursuant to Section 19(b)(1) of the
change.4 The proposed rule change and exchange9 and, in particular, the Securities Exchange Act of 1934
Amendment No. 1 were published for requirements of Section 6(b) of the Act10 (‘‘Act’’),1 and Rule 19b–4 thereunder,2
comment in the Federal Register on July and the rules and regulations notice is hereby given that on July 29,
11, 2005.5 No comments were received thereunder. Specifically, the 2005, the Pacific Exchange, Inc. (‘‘PCX’’
regarding the proposal, as amended. Commission finds that the proposal to or ‘‘Exchange’’) filed with the Securities
This order approves the proposed rule retroactively establish a $.10 per and Exchange Commission
change, as amended. contract surcharge fee for certain (‘‘Commission’’) the proposed rule
The Exchange’s Schedule of Fees transactions in options on SPDRs that change as described in Items I, II, and
currently has in place a surcharge fee occurred on the ISE between January 10, III below, which Items have been
item that calls for a $.10 per contract fee 2005 and May 19, 2005,11 is consistent prepared by the PCX. The PCX has
for transactions in certain licensed with Section 6(b)(4) of the Act,12 which designated this proposal as one
products. The Exchange has entered requires the equitable allocation of establishing or changing a due, fee, or
into a license agreement with Standard reasonable dues, fees, and other charges other charge imposed by a self-
and Poor’s, a unit of McGraw-Hill among Exchange members and other regulatory organization pursuant to
Companies, Inc., authorizing the persons using Exchange facilities. The Section 19(b)(3)(A)(ii) of the Act,3 and
Exchange to list SPDR options. The Commission believes that, because the Rule 19b–4(f)(2) thereunder,4 which
Exchange proposes to adopt this fee for options on SPDRs have been listed and renders the proposal effective upon
transactions in SPDR options in order to traded on the Exchange since January filing with the Commission. The
defray the licensing costs. The Exchange 10, 2005, the retroactive extension of the Commission is publishing this notice to
believes that charging the participants solicit comments on the proposed rule
that trade these instruments is the most 6 Public Customer is defined in ISE Rule
change from interested persons.
equitable means of recovering the costs 100(a)(32) as a person that is not a broker or dealer
in securities. I. Self-Regulatory Organization’s
1 15 U.S.C. 78s(b)(1). 7 Public Customer Order is defined in ISE Rule
Statement of the Terms of Substance of
2 17 CFR 240.19b–4. 100(a)(33) as an order for the account of a Public the Proposed Rule Change
3 The Exchange filed with the Commission an Customer.
identical fee change on May 20, 2005 (SR–ISE–
8 See ISE Rule 1900(10) (defining Linkage The PCX proposes to amend the
2005–06), which was immediately effective as of Orders). The surcharge fee will apply to the Market Maker Fee in its Schedule of
that date under Section 19(b)(3)(A) of the Act and following Linkage Orders: Principal Acting as Agent
Orders and Principal Orders. The expiration date
Fees and Charges. The text of the
Rule 19b–4(f)(2) thereunder. See Securities
Exchange Act Release No. 51901 (June 22, 2005), 70 for this pilot program was recently extended from proposed rule change is available on the
FR 37455 (June 29, 2005). Because the Exchange July 31, 2005 to July 31, 2006. See Exchange Act Exchange’s Internet Web site (http://
sought to apply the same surcharge fee on a Release No. 34–52168 (July 29, 2005) (File No. SR– www.pacificex.com), at the Exchange’s
retroactive basis as of January 10, 2005, the ISE–2005–32).
9 In approving this proposal, the Commission has
Exchange submitted this proposal to the 13 Id.
Commission under Section 19(b)(2) of the Act. considered the proposed rule’s impact on
14 17 CFR 200.30–3(a)(12).
4 In Amendment No. 1, the Exchange made non- efficiency, competition, and capital formation. 15
substantive changes to clarify the purpose for the U.S.C. 78c(f). 1 15 U.S.C. 78s(b)(1).
10 15 U.S.C. 78f(b). 2 17 CFR 240.19b–4.
fee change.
5 See Securities Exchange Act Release No. 51948 11 See supra note 3. 3 15 U.S.C. 78s(b)(3)(A)(ii).

(June 30, 2005), 70 FR 39832. 12 15 U.S.C. 78f(b)(4). 4 17 CFR 240.19b–4(f)(2).

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Federal Register / Vol. 70, No. 158 / Wednesday, August 17, 2005 / Notices 48455

Office of the Secretary, and at the C. Self-Regulatory Organization’s Commission, and all written
Commission’s Public Reference Room. Statement on Comments on the communications relating to the
Proposed Rule Change Received From proposed rule change between the
II. Self-Regulatory Organization’s Members, Participants, or Others Commission and any person, other than
Statement of the Purpose of, and those that may be withheld from the
Statutory Basis for, the Proposed Rule The Exchange has neither solicited
nor received written comments on the public in accordance with the
Change provisions of 5 U.S.C. 552, will be
proposed rule change.
In its filing with the Commission, the available for inspection and copying in
III. Date of Effectiveness of the the Commission’s Public Reference
PCX included statements concerning the Proposed Rule Change and Timing for
purpose of, and basis for, the proposed Room. Copies of such filing also will be
Commission Action available for inspection and copying at
rule change and discussed any
comments it received on the proposed The foregoing proposed rule change the principal office of the Exchange. All
rule change. The text of these statements has become effective pursuant to comments received will be posted
may be examined at the places specified Section 19(b)(3)(A)(ii) of the Act,7 and without change; the Commission does
in Item IV below. The PCX has prepared paragraph (f)(2) of Rule 19b–4 not edit personal identifying
summaries, set forth in Sections A, B, thereunder,8 because it establishes or information from submissions. You
and C below, of the most significant changes a due, fee, or other charge should submit only information that
aspects of such statements. imposed by the Exchange. At any time you wish to make available publicly. All
within 60 days of the filing of the submissions should refer to File
A. Self-Regulatory Organization’s proposed rule change, the Commission Number SR–PCX–2005–89 and should
Statement of the Purpose of, and may summarily abrogate such rule be submitted on or before September 7,
Statutory Basis for, the Proposed Rule change if it appears to the Commission 2005.
Change that such action is necessary or For the Commission, by the Division of
appropriate in the public interest, for Market Regulation, pursuant to delegated
1. Purpose
the protection of investors, or otherwise authority.9
The PCX proposes to amend the in furtherance of the purposes of the
Margaret H. McFarland,
Market Maker Fee. Currently, the fee is Act.
Deputy Secretary.
$1,750 per month, and the fee is IV. Solicitation of Comments [FR Doc. E5–4489 Filed 8–16–05; 8:45 am]
prorated for each day the Market Maker
Interested persons are invited to BILLING CODE 8010–01–P
trades at the PCX. The PCX proposes to
submit written data, views, and
reduce the Market Maker Fee to $1,500
arguments concerning the foregoing,
per month and no longer prorate the fee
including whether the proposed rule SECURITIES AND EXCHANGE
based on daily usage. By no longer
change is consistent with the Act. COMMISSION
prorating the fee, the PCX would save a
Comments may be submitted by any of
substantial amount of administrative
the following methods: [Release No. 34–52241; File No. SR–PCX–
time that is associated with tracking the
daily access of each Market Maker. It Electronic Comments 2005–31]
also would allow the PCX to automate • Use the Commission’s Internet
the billing of this fee. According to the Self-Regulatory Organizations; Pacific
comment form (http://www.sec.gov/ Exchange, Inc.; Order Approving a
PCX, based upon past history of overall rules/sro.shtml); or Proposed Rule Change and
usage by the PCX Market Makers, the • Send an e-mail to rule-
reduction of the fee by $250 per month, Amendments No. 1, 2, and 3 Thereto
comments@sec.gov. Please include File
coupled with the elimination of the To Permit Lead Market Makers To
Number SR–PCX–2005–89 on the
current policy to prorate the fee, would Operate Remotely
subject line.
have little, if any, positive or negative August 11, 2005.
impact on revenue for the Exchange. Paper Comments
• Send paper comments in triplicate I. Introduction
2. Statutory Basis to Jonathan G. Katz, Secretary,
Securities and Exchange Commission, On March 15, 2005, the Pacific
The Exchange believes that the Exchange, Inc. (‘‘PCX’’ or ‘‘Exchange’’)
proposed rule change is consistent with Station Place, 100 F Street, NE.,
Washington, DC 20549–9303. filed with the Securities and Exchange
Section 6(b) of the Act,5 in general, and Commission (‘‘Commission’’), pursuant
All submissions should refer to File
furthers the objectives of Section 6(b)(4) to Section 19(b)(1) of the Securities
Number SR–PCX–2005–89. This file
of the Act,6 in particular, in that it Exchange Act of 1934 (‘‘Act’’)1 and Rule
number should be included on the
provides for the equitable allocation of subject line if e-mail is used. To help the 19b–4 thereunder,2 a proposed rule
reasonable dues, fees, and other charges Commission process and review your change to amend its rules to allow Lead
among its members. comments more efficiently, please use Market Makers (‘‘LMMs’’) to operate
B. Self-Regulatory Organization’s only one method. The Commission will from a remote location. The Exchange
Statement on Burden on Competition post all comments on the Commission’s submitted Amendments No. 1, 2, and 3
Internet Web site (http://www.sec.gov/ on May 27, 2005,3 June 6, 2005,4 and
The Exchange does not believe that rules/sro.shtml). Copies of the
the proposed rule change will impose submission, all subsequent 9 17 CFR 200.30–3(a)(12).
any burden on competition that is not amendments, all written statements 1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
necessary or appropriate in furtherance with respect to the proposed rule 3 Amendment No. 1 makes clarifying changes to
of the purpose of the Act. change that are filed with the the purpose statement and rule text. Amendment
No. 1 replaces the original rule filing in its entirety.
5 15 U.S.C. 78f(b). 7 15 U.S.C. 78s(b)(3)(A)(ii). 4 Amendment No. 2 makes a technical correction
6 15 U.S.C. 78f(b)(4). 8 17 CFR 240.19b–4(f)(2). to the rule text in Exhibit 5.

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