[Federal Register Volume 63, Number 65 (Monday, April 6, 1998)]
[Notices]
[Pages 16839-16840]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-8923]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-39809; File No. SR-CBOE-98-10]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by Chicago Board Options
Exchange, Incorporated Related to Fees for Applicants for Membership
and Existing Members Who Are Subject to a Statutory Disqualification
March 26, 1998.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ notice is hereby given that on March 10, 1998, the
Chicago Board Options Exchange, Incorporated (``CBOE'' or ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'' or
``SEC'') the proposed rule change as described in Items I, II, and III
below, which Items have been prepared by the CBOE. The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The CBOE proposes to adopt two new fees applicable to persons
subject to a statutory disqualification under the Act on whose behalf
the Exchange is obligated to file notice with the SEC pursuant to Rule
19h-1 under the Act.\2\
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\2\ 17 CFR 240.19h-1.
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The text of the proposed rule change is available at the Office of
the Secretary, CBOE 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, CBOE 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 CBOE 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
The purpose of the proposed rule change is to adopt two new fees
that are intended to defray some of the expenses incurred by the
Exchange in connection with applicants for membership and existing
members who are subject to a statutory disqualification. The first new
fee applies to any person who submits an application to the Exchange
seeking to become a member or an associated person of a member or to
continue as a member or in association with a member notwithstanding a
statutory disqualification. The second new fee applies to any person
who has been approved for membership or association with a member
notwithstanding a statutory disqualification, and who subsequently
seeks a change in status that, if approved, would require another
filing to be made pursuant to Rule 19h-1(c) under the Act.\3\ These two
new fees would be in addition to any other Exchange membership fees
that might be applicable.
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\3\ 17 CFR 240.19h-1(c).
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Pursuant to Rule 19h-1 under the Act, the Exchange must file a
notice with the Commission if the Exchange proposes to continue in or
to admit into membership or association with a member any person
subject to a statutory disqualification. Evaluating the circumstances
of the statutory disqualification and the appropriateness of permitting
the member or associated person to continue in or be admitted to
membership or association with a member, and filing this notice with
the Commission, requires effort and time by the Exchange staff and thus
creates an expense for the Exchange. The Exchange believes it is
appropriate for the applicant, member, or person associated with a
member who is subject to a statutory disqualification to pay a fee that
will offset at least a portion of these expenses. The Exchange believes
that a fee in the amount of $2,500 is appropriate for this purpose.
After the Rule 19h-1 notice process has been completed and the
necessary approvals have been obtained, if the member or associated
person wants to change the status previously approved and the Exchange
approves of this change, then the Exchange typically must file an
amended or additional notice with the Commission pursuant Rule 19h-
1(c). Once again the Exchange will incur the time and expense of
complying with Rule 19h-1 on behalf of the member or associated person.
The Exchange believes it is appropriate for the member or associated
person who makes an application that, if approved, will make it
necessary for the Exchange to undertake the filing of an amended 19h-
1(c) notice to pay a fee to offset these expenses at least in part.
Therefore, the proposed rule change would authorize the Exchange to
charge a fee of $1,500 to any member or associated person on whose
behalf the Exchange has filed a Rule 19h-1 filing that has been
approved by the Commission who applies for a change in status that will
require the Exchange to file an amended or additional Rule 19h-1(c)
filing if the Exchange approves the requested change in status.
The proposed rule change is consistent with Section 6(b) of the
Act, in general, and furthers the objectives of Section 6(b)(4) of the
Act, in particular, in that it is designed to provide for the equitable
allocation of reasonable dues, fees, and other charges among CBOE
members.
B. Self-Regulatory Organization's Statement on Burden on Competition
CBOE does not believe that the proposed rule change will impose any
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 solicited or received with respect to the
proposed rule change.
[[Page 16840]]
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
The proposed rule change has become effective upon filing pursuant
to Section 19(b)(3)(A)(ii) of the Act, and subparagraph (e) of Rule
19b-4 thereunder, in that it is designated by the Exchange as
establishing a due, fee, or other charge. At any time within 60 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. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.
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 Room. Copies of such filing will also be
available for inspection and copying at the principal office of CBOE.
All submissions should refer to the file number in the captain above
and should be submitted by April 28, 1998.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\4\
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\4\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-8923 Filed 4-3-98; 8:45 am]
BILLING CODE 8010-01-M