SEC Announces Billion Dollar Fee Cut to Benefit Investors
FY 2007 Registration Fees to Be Reduced by 71%, Transaction Fees by Half
FOR IMMEDIATE RELEASE
Washington, D.C., May 3, 2006 - The Securities and Exchange Commission announced today that fees on securities transactions and registrations will be reduced by $1 billion in the fiscal year that starts Oct. 1, 2006.
"This is terrific news for investors," said SEC Chairman Christopher Cox. "Even by Washington's standards, a billion dollars is a lot of money. Money that ultimately would have come out of investors' pockets can instead now go to retirement accounts, college savings plans, and other investment goals."
The SEC sets registration and transaction fees according to the Investor and Capital Markets Fee Relief Act. In fiscal year 2007, the fees that public companies and other issuers pay to register their securities with the Commission will be reduced by 71.3 percent, and the fees applicable to most securities transactions will be reduced by 50.2 percent.
As required by the statute, the Commission consulted with both the Congressional Budget Office and the Office of Management and Budget regarding the annual adjustment, which will not affect the amount of funding available to the Commission.
A copy of the Commission's order, including the calculation methodology, is available at http://www.sec.gov/rules/other/2006/33-8681.pdf.
The Investor and Capital Markets Fee Relief Act requires that the Commission make annual adjustments to the rates for fees paid under Section 6(b) of the Securities Act of 1933 and Sections 13(e), 14(g), and 31 of the Securities Exchange Act of 1934.
Effective Oct. 1, 2006, or 5 days after the date on which the Commission receives its fiscal year 2007 regular appropriation, whichever date comes later, the Section 6(b) fee rate applicable to the registration of securities, the Section 13(e) fee rate applicable to the repurchase of securities, and the Section 14(g) fee rates applicable to proxy solicitations and statements in corporate control transactions will decrease to $30.70 per million from the current rate of $107.00 per million. The Section 6(b) rate is also the rate used to calculate the fees payable with the Annual Notice of Securities Sold Pursuant to Rule 24f-2 under the Investment Company Act of 1940.
In addition, effective Oct. 1, 2006, or 30 days after the date on which the Commission receives its fiscal year 2007 regular appropriation, whichever date comes later, the Section 31 fee rate applicable to securities transactions on the exchanges and certain over-the-counter markets will decrease to $15.30 per million from the current rate of $30.70 per million.
Pursuant to their rules, self-regulatory organizations collect from their members funds to offset the self-regulatory organizations' Section 31 obligations. Additional information on the transition to the new Section 31 fee rate will be available shortly on the Internet Web sites of the New York Stock Exchange and NASD at http://www.nyse.com and http://www.nasd.com, respectively. The Office of Interpretation and Guidance in the Commission's Division of Market Regulation is also available for questions on Section 31 fees at (202) 551-5760, or by e-mail at email@example.com.
The Commission will issue further notices as appropriate to keep the public informed of developments relating to the effective dates of the fee rates under Section 6(b), Section 13(e), Section 14(g), and Section 31. These notices will be posted at the Commission's Internet Web site at http://www.sec.gov.
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