New York, NY May 16, 2012 - The Proxy Fee Advisory Committee (PFAC), formed by the New York Stock Exchange, today published its recommendations for changes to the fees paid by public companies to banks and brokers for the distribution of proxy materials to shareholders who hold their stock in "street name." Composed of issuers, broker dealers and investors, the PFAC was formed in September 2010 to review the existing proxy distribution fee structure and make recommendations for change. Any changes to these fees are subject to SEC approval.
Overall, the Committee's recommendations will propose to streamline proxy fees and make them more transparent to issuers as well as result in a modest decrease in total fees paid of approximately 4%, although some fees will increase and others will decrease. The impact on any individual participant will vary somewhat depending on their circumstances.
"Proxy distribution fees have been part of the NYSE's rules since 1937, and have been reviewed and changed periodically over that time," said Scott Cutler, Co-Head of U.S. Listings and Cash Execution and member of the PFAC Committee. "The NYSE has long operated under the assumption that these fees should represent a consensus view of the issuers and the broker-dealers involved."
The goals of the Committee have been to support the current proxy distribution system, including continued support for the elimination of mailings; to encourage and facilitate active voting participation by retail beneficial owners; improve transparency of the fee structure and ensure that fees are as fair as possible and aligned with the work involved.
"The recommendations reflect a great deal of careful consideration by the Committee, with invaluable support by the NYSE, and input from many different stakeholders in the process," said Paul Washington, Senior Vice President, Deputy General Counsel and Corporate Secretary of Time Warner Inc., and PFAC Chair. "The proposed fee structure is intended to continue to support a world-class process that facilitates communications with, and voting by, stockholders; and one that will be flexible enough to encourage further efficiencies and voter participation by retail stockholders."
Recommendations of the Proxy Fee Advisory Committee
The PFAC also recommended that the NYSE:
The Committee recognizes that there is a reliable, accurate and secure proxy distribution process in place today. The Committee's stated purpose is to bring proxy distribution fees in line with the work performed and add increased transparency. It should be noted that the Committee's fee recommendations do not attempt to take into account potential changes to SEC rules that are discussed in the SEC's proxy plumbing concept release.
The NYSE will initiate discussions regarding the PFAC's recommendations with the SEC, after which the NYSE would expect to submit a rule change proposal to the SEC reflecting the outcome of these discussions. Any rule filing proposal would be published for public comment prior to SEC approval.
To read the full Proxy Fee Advisory Committee report, please click here.
About NYSE Euronext
NYSE Euronext (NYX) is a leading global operator of financial markets and provider of innovative trading technologies. The company's exchanges in Europe and the United States trade equities, futures, options, fixed-income and exchange-traded products. With approximately 8,000 listed issues (excluding European Structured Products), NYSE Euronext's equities markets - the New York Stock Exchange, NYSE Euronext, NYSE MKT, NYSE Alternext and NYSE Arca - represent one-third of the worlds equities trading, the most liquidity of any global exchange group. NYSE Euronext also operates NYSE Liffe, one of the leading European derivatives businesses and the world's second-largest derivatives business by value of trading. The company offers comprehensive commercial technology, connectivity and market data products and services through NYSE Technologies. NYSE Euronext is in the S&P 500 index. For more information, please visit: http://www.nyx.com.
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