February 6, 2007
Usually pirates hoist the jolly roger and then come alongside ship; in the case of NASDAQ they dispense with the flag and merely use lawyers to propose new fees while neglecting to give listed firms the opportunity to comment. A diligent search of the SEC's web site has never revealed to me the secret location to file my protest against NASDAQ's rapacity. Only a random chance led me this year for the first time to the secret location to file a protest.
Five years ago my bank's fee for being listed on NASDAQ was $4,000. In rapid steps it has risen to $17,000 and now the annual fee is proposed to be $27,500. I receive no greater services for the privilege. The last time I heard, there hasn't been any rapid inflation with costs rising by 8 times. The only thing that is different is that NASDAQ is a public company and wants to increase it earnings. Yet, there are only 800 firms on the NASDAQ Capital Market, so the increase fees of $23,500 each only yield $19 million a year in extra profits for NASDAQ. Chump change in the scheme of things - but then again it helps pay the margin loan for their investment in the London Stock Exchange.
The key question for the SEC Commissioners to consider is this: Is this good public policy to octuple the listing fees for the smallest listed firms in the U.S. and especially in light of the high burden of Sarbanes-Oxley on smaller firms? The clear answer is no It is not in the best interest of the U.S. economy for the public markets to be closed to small firms or to substantially raise the cost to be exchange listed.
Please note I don't want and don't use any of these additional "services" that NASDAQ wants to sell me and at any rate, why should that be borne by the listed firms as opposed to the for profit corporation if it wants to go into additional lines of business?
The SEC is the regulator of the fees charged by the public exchanges. As far as I can tell, the SEC has completely abrogated its responsibility. Otherwise how can it justify a octupling of the fees in six years when inflation was only perhaps 15% over that same timeframe?