[Federal Register Volume 62, Number 20 (Thursday, January 30, 1997)]
[Notices]
[Pages 4553-4555]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-2257]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38204; File No. SR-OPRA-97-1]
Options Price Reporting Authority; Notice of Filing and Immediate
Effectiveness of Amendment to OPRA Fee Schedule Revising the Device-
Based Information Fees Payable by Professional Subscribers to OPRA's
Basic Service and Implementing a New Enterprise Rate Professional
Subscriber Fee as an Alternative to the Device-Based Fee
January 24, 1997.
Pursuant to Rule 11Aa3-2 under the Securities Exchange Act of 1934
(``Exchange Act''), notice is hereby given that on January 8, 1997, the
Options Price Reporting Authority (``OPRA'') \1\ submitted to the
Securities and Exchange Commission (``SEC'' or ``Commission'') an
amendment to the Plan for Reporting of Consolidated Options Last Sale
Reports and Quotation Information (``Plan''). The amendment revises the
device-based information fees payable by professional subscribers to
OPRA's basic service. Moreover, OPRA is establishing a new ``enterprise
rate'' professional subscriber fee as an alternative to the device-
based fee applicable to members of OPRA's
[[Page 4554]]
participant exchanges. OPRA has designated this proposal as
establishing or changing a fee or other charge collected on behalf of
all of the OPRA participants in connection with access to or use of
OPRA facilities, permitting the proposal to become effective upon
filing pursuant to Rule 11Aa3-2(c)(3)(i) under the Exchange Act. The
Commission is publishing this notice to solicit comments from
interested persons on the amendment.
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\1\ OPRA is a National Market System Plan approved by the
Commission pursuant to Section 11A of the Exchange Act and Rule
11Aa3-2 thereunder. Securities Exchange Act Release No. 17638 (Mar.
18, 1981).
The Plan provides for the collection and dissemination of last
sale and quotation information on options that are traded on the
five member exchanges. The five exchanges which agreed to the OPRA
Plan are the American Stock Exchange (``AMEX''); the Chicago Board
Options Exchange (``CBOE''); the New York Stock Exchange (``NYSE'');
the Pacific Stock Exchange (``PSE''); and the Philadelphia Stock
Exchange (``PHLX'').
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I. Description and Purpose of the Amendment
The purpose of the amendment is to revise the fees payable to OPRA
by professional subscribers for access to OPRA's basic service, which
consists of market data and related information pertaining to equity
and index options (``OPRA data'').\2\ Professional subscribers are
those persons that subscribe to OPRA data and do not qualify for the
reduced fees charged to nonprofessional subscribers. OPRA's
professional subscriber fees were last revised in January 1996 pursuant
to a Plan amendment that initially proposed a program of fee revisions
to be implemented in stages over a four-year period.\3\ Subsequently,
OPRA withdrew that filing and filed instead only the first stage of the
fee revision program, with the understanding that the implementation of
the remaining stages would be the subject of separate filings.\4\
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\2\ Information pertaining to foreign currency options (FCOs) is
provided through OPRA's FCO Service, which fees are not affected by
this filing.
\3\ See Securities Exchange Act Release No. 36364 (October 12,
1995), 60 FR 54093 (October 19, 1995).
\4\ See Securities Exchange Act Release No. 36817 (February 7,
1996), 61 FR 5827 (February 14, 1996).
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As was the case with the first stage, this amendment is intended to
increase OPRA revenues derived from device-based subscriber fees by
less than 5% in order to permit a greater share of the costs of
collecting, consolidating, processing and transmitting OPRA data to be
covered by these fees, while at the same time continuing the process of
simplifying the structure of the professional subscriber fee by
reducing the number of pricing tiers for purposes of the volume
discount in the per device fee.
The proposed changes in the level of OPRA's device-based
professional subscriber fees will reduce the fees paid by smaller
subscribers and increase the fees paid by larger subscribers.\5\
Subscriber having less than four devices will see their per device fees
reduced by $11 per month, while subscribers having from four to nine
devices will see no change in their fees. On the other hand, per device
fees for larger subscribers that do not elect the alternative
enterprise rate described below will increase by amounts ranging from
$.35 to $.60 for members of OPRA's participant exchanges, with somewhat
higher increases for certain categories of non-members, as a result of
the reduction in the number of non-member volume discount tiers from
six to three. Moreover, subscriber fees charged to members will be
discounted by 2% for members who preauthorize payment by electronic
funds transfer through an automated clearinghouse system.
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\5\ The proposed tiers are as follows: (1) For 1-9 devices,
members pay $23.00 per device, and non-members pay $24.00 per
device; (2) for 10-29 devices, members pay $14.00 per device, and
non-members pay $19.00 per device; (3) for 30-99 devices, members
pay $11.00 per device, and non-members pay $19.00 per device; (4)
for 100-749 devices; members pay $11.00 per device, and non-members
pay $12.75 per device; and (5) for 750+ devices, members pay $9.00
per device, and non-members pay $12.75 per device.
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As an alternative to the traditional device-based subscriber fee,
this amendment also proposes the adoption of a new ``enterprise rate''
subscriber fee, which will permit members of OPRA's participant
exchanges to pay a flat monthly fee and thereby be authorized to access
OPRA data on any number of devices at no additional cost. The
enterprise rate is based on the number of registered representatives
employed by the subscriber, and is $10 per month per registered
representative in member firms having up to 20,000 registered
representatives, and $7.50 per month per registered representative in
member firms having more than 20,000 registered representatives. There
is a minimum monthly fee of $2,000 for member firms electing the
enterprise rate. OPRA believes the enterprise rate fee will be
advantageous to a number of subscribers because it will lower their
cost of access to OPRA data and eliminate the burden of keeping track
of and reporting to OPRA the number of their devices, and also because
it will give firms the flexibility to increase access to OPRA data
without additional cost. Because the enterprise rate is based on a
member firm's number of representatives registered with the National
Association of Securities Dealers, Inc. (``NASD''), the rate is only
applicable to member firm locations in the United States. Non-U.S.
offices of member firms will continue to pay the device-based fee with
respect to those offices, although at a volume discounted rate that
takes into account all of their OPRA-enabled devices throughout the
world, including those devices in the United States to which the
enterprise rate fee may apply.
OPRA is proposing these fee changes because, as a result of the
implementation of systems and equipment upgrades and additions in order
to increase the capacity and enhance the reliability and security of
the OPRA system, the costs of collecting, processing, consolidating and
disseminating OPRA data have continued to increase. OPRA anticipates
continued escalation of these costs. OPRA states that the device-based
fee increases provided for in the proposed amendment are intended to
cover these costs. At the same time, by introducing the new enterprise
rate subscriber fee, OPRA will be able to lower its costs of
administration by eliminating the need to keep track of subscriber
device counts, and will pass on a portion of these savings to
enterprise rate subscribers in the form of lower overall costs of
access. OPRA proposes to implement the new fee structure beginning on
March 1, 1997.
II. Solicitation of Comments
Pursuant to Rule 11Aa3-2(c)(3), the amendment is effective upon
filing with the Commission. The Commission may summarily abrogate the
amendment within 60 days of its filing and require refiling and
approval of the amendment by Commission order pursuant to Rule 11Aa3-
2(c)(2), if it appears to the Commission that such action is necessary
or appropriate in the public interest; for the protection of investors
and the maintenance of fair and orderly markets; to remove impediments
to, and perfect the mechanisms of, a National Market System; or
otherwise in furtherance of the purposes of the Exchange Act.
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
Copies of the submission, all subsequent amendments, and 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
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 at
the principal offices of OPRA. All
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submissions should refer to file number SR-OPRA-97-1 and should be
submitted by February 15, 1997.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority. \6\
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\6\ 17 CFR 200.30-3(a)(29).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-2257 Filed 1-29-97; 8:45 am]
BILLING CODE 8010-01-M