Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by the Philadelphia Stock Exchange, Inc. To Modify the Frequency of Billing for the Controller Space Charge, Floor Facilities Fees, Shelf Space Fee on the Equity Options Floor, and Direct Wire Changes From a Quarterly to a Monthly Basis

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), and Rule 19b-4 thereunder, notice is hereby given that on March 9, 2000, the Philadelphia Stock Exchange, Inc. (“Phlx” or “Exchange”) filed with the Securities and Exchange Commission (“SEC” or “Commission”) the proposed rule change as described in Items, I, II, and III below, which Items have been prepared by the Exchange. On March 22, 2000, the Exchange submitted Amendment No. 1 to the proposed rule change.

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

The Phlx proposes to amend its schedule of dues, fees and charges so that it will bill the controller space charge, floor facilities fees, shelf space fee on the equity options floor and direct wire charges on a monthly basis rather than the quarterly basis the Exchange currently uses. The amounts of the charges of fees will remain unchanged; only the frequency of billing for such fees or charges will change to a monthly basis. The Phlx proposes that the change in the frequency of billing for the fees or charges mentioned above become effective at the opening of business on April 1, 2000.

II. Self-Regulatory Organization's Statements 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. The text of these statements may be examined at the places specified in Item IV below. The Exchange 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

1. Purpose

The Exchange proposes to amend the Phlx's fee schedule to change the frequency that Exchange members, foreign currency option (“FCO”) participants and member organizations and participant organizations are billed for the controller space charge, floor facilities fees, shelf space fee for the equity options floor and the direct wire charges. The Exchange proposes to bill these fees or charges on a monthly basis, instead of on a quarterly basis.

The Exchange's Finance Committee is recommending that the fees or charges mentioned above be billed monthly instead of quarterly to enhance operational efficiency for the Exchange and its members and participants. The Exchange represents that the proposed rule change would permit the Exchange's Accounting Department to operate more effectively. The Exchange further represents that the proposed rule change would allow Exchange members and participants to more accurately gauge their monthly operating expenses, and to permit them to reduce their operational cash flow burdens that may result from the current quarterly payment schedule.

2. Statutory Basis

The Exchange believes that the proposed rule change is consistent with Section 6 of the Act in general, and further the objectives of Section 6(b)(4) in particular, in that it provides for the equitable allocation of reasonable dues, fees, and other charges amount its members and other persons using its facilities. Specifically, the Exchange believes that the proposed rule change is reasonable and equitable because only the frequency of billing for the fees or charges mentioned above will be changed, and not the amount billed.

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

The Phlx 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

The foregoing rule change establishes or changes a fee, due or charge imposed by the Exchange and, therefore, has become effective upon filing pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(2) thereunder. The Exchange intends to implement the change to the frequency of billing for the fees or charges mentioned above at the opening of business on April 1, 2000. At any time within 60 days of 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 furtherance of the purpose 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. 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 the Phlx. All submissions should refer to File No. SR-Phlx-00-23 and should be submitted by May 8, 2000.