SEC, SROs to Develop New Rules to Accommodate Fee Reduction

Washington, DC, December 28, 2001 - On December 21, 2001, Congress passed the "Investor and Capital Markets Fee Relief Act" (H.R. 1088), which, among other things, reduces the fee rates under Section 31 of the Securities Exchange Act of 1934 to $15 per $1,000,000. This fee reduction is effective Friday, December 28, 2001, even though the President is not expected to sign it into law until early in 2002.

The Securities and Exchange Commission has asked the self-regulatory organizations to develop rules to accommodate compliance with the fee reduction. Both the New York Stock Exchange and NASD Regulation, Inc. have issued press releases informing their members that they will have until February 1, 2002 to reprogram their systems to accommodate the fee reduction under the condition that they have a system in place to rebate the excess fees that will be charged until their systems are reprogrammed.