Self-Regulatory Organizations; International Securities Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Fee Changes, 40088-40089 [E5-3664]

Download as PDF 40088 Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Notices 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 CHX. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File No. SR–CHX–2004–25 and should be submitted on or before August 2, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.21 Jill M. Peterson, Assistant Secretary. [FR Doc. E5–3665 Filed 7–11–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–51962; File No. SR–ISE– 2005–29] Self-Regulatory Organizations; International Securities Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Fee Changes July 1, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’), 1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 6, 2005, the International Securities Exchange, Inc. (‘‘ISE’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the ISE. On June 20, 2005, ISE filed Amendment No. 1 to the proposed rule change.3 The ISE has designated this proposal as one establishing or changing a due, fee, or other charge imposed by the ISE under Section 19(b)(3)(A)(ii) of the Act,4 and 21 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Amendment No. 1 made a technical change to the text of Exhibit 5 (ISE’s Schedule of Fees) and added footnote 6 to this rule filing. The correction to Exhibit 5 does not affect the fees for transactions in options on the five narrow-based indexes that are the subject of this filing, but only corrects Exhibit 5 to remove asterisks between the Payment for Order Flow section under Execution Fees and the Comparison Fee section, since no rule text has been omitted between those two sections. 4 15 U.S.C. 78s(b)(3)(A)(ii). VerDate jul<14>2003 16:15 Jul 11, 2005 Jkt 205001 Rule 19b–4(f)(2) thereunder,5 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The ISE is proposing to amend its Schedule of Fees to establish fees for transactions in options on five narrowbased indexes: the ISE–CCM Homeland Security Index, the ISE Oil & Gas Services Index, the ISE Semiconductors Index, the ISE Gold Index and the ISE Homebuilders Index.6 The text of the proposed rule change is available on the ISE’s Web site (http:// www.iseoptions.com/legal/ proposedlrulelchanges.asp), at the principal office of the ISE, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the ISE included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The ISE 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 is proposing to amend its Schedule of Fees to establish fees for transactions in options on five narrowbased indexes: the ISE–CCM Homeland Security Index (‘‘HSX’’), the ISE Oil & Gas Services Index (‘‘OOG’’), the ISE Semiconductors Index (‘‘BYT’’), the ISE Gold Index (‘‘HVY’’), and the ISE Homebuilders Index (‘‘RUF’’). Specifically, the Exchange is proposing to adopt an execution fee and a CFR 240.19b–4(f)(2). Exchange represents that the following five narrow-based indexes, ISE–CCM Homeland Security Index, the ISE Oil & Gas Services Index, the ISE Semiconductors Index, the ISE Gold Index and the ISE Homebuilders Index, meet the standards of ISE Rule 2002(b), which allows the ISE to begin trading these products by filing Form 19b– 4(e) at least five business days after commencement of trading these new products pursuant to Rule 19b–4(e) of the Act. Accordingly, ISE filed Form 19b–4(e) with the Commission on June 13, 2005. PO 00000 5 17 6 The Frm 00102 Fmt 4703 Sfmt 4703 comparison fee for all transactions in options on HSX, OOG, BYT, HVY, and RUF.7 The amount of the execution fee and comparison fee shall be the same for all order types on the Exchange— that is, orders for Public Customers, Market Makers, and Firm Proprietary— and shall be equal to the execution fee and comparison fee currently charged by the Exchange for Market Maker and Firm Proprietary transactions in equity options.8 The Exchange believes the proposed rule change will further the Exchange’s goal of introducing new products to the marketplace that are competitively priced. Additionally, the Exchange has entered into a license agreement with Cronus Capital Markets in connection with the listing and trading of options on HSX. As with certain other licensed options, the Exchange is adopting a surcharge per contract for trading in these options to defray the licensing costs.9 The Exchange believes that charging the participants that trade this instrument is the most equitable means of recovering the costs of the license. However, because of competitive pressures in the industry, the Exchange proposes to exclude Public Customer Orders 10 from this surcharge fee. Accordingly, this surcharge fee will only be charged to Exchange members with respect to non-Public Customer Orders (e.g., Market Maker and Firm Proprietary orders) and shall apply to Linkage Orders 11 under a pilot program that is set to expire on July 31, 2005. Further, since options on HSX, OOG, BYT, HVY, and RUF are not multiplylisted, the Payment for Order Flow fee shall not apply. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b)(4) of the Act,12 which requires that an exchange have an equitable allocation of reasonable dues, fees, and other charges among its members and other persons using its facilities. 7 The Exchange represents that these fees will be charged only to Exchange members. 8 The execution fee is currently between $.21 and $.12 per contract side, depending on the Exchange Average Daily Volume, and the comparison fee is currently $.03 per contract side. 9 The Commission notes the proposed fee is five (5) cents per contract/side. 10 Public Customer Order is defined in ISE Rule 100(a)(33) as an order for the account of a Public Customer. Public Customer is defined in ISE Rule 100(a)(32) as a person that is not a broker or dealer in securities. 11 See ISE Rule 1900(10). 12 15 U.S.C. 78f(b)(4). E:\FR\FM\12JYN1.SGM 12JYN1 Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Notices B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange believes that the proposed rule change does not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing rule change, as amended, establishes or changes a due, fee, or other charge imposed by the Exchange, it has become effective pursuant to Section 19(b)(3) of the Act 13 and Rule 19b–4(f)(2) 14 thereunder. At any time within 60 days of the filing of such amended 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 purposes of the Act.15 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. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File No. SR–ISE–2005–29 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, 13 15 U.S.C. 78s(b)(3)(A). 14 17 CFR 19b–4(f)(2). 15 The effective date of the original proposed rule is June 6, 2005. The effective date of Amendment No. 1 is June 20, 2005. For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on June 20, 2005, the date on which the ISE submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). VerDate jul<14>2003 16:15 Jul 11, 2005 Jkt 205001 Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–ISE–2005–29. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commissions Internet Web site (http://www.sec.gov/ rules/sro.shtml). 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 also will be available for inspection and copying at the principal office of the ISE.All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–ISE–2005–29 and should be submitted by August 2, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.16 Jill M. Peterson, Assistant Secretary. [FR Doc. E5–3664 Filed 7–11–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–51968; File No. SR–ISE– 2004–33] Self-Regulatory Organizations; International Securities Exchange, Inc.; Notice of Filing of a Proposed Rule Change and Amendment No. 1 Thereto Relating to the Facilitation of Complex Orders July 1, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on November 16, 2004, the International Securities PO 00000 16 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 1 15 Frm 00103 Fmt 4703 Sfmt 4703 40089 Exchange, Inc. (‘‘ISE’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the ISE. On December 14, 2004, the ISE submitted Amendment No. 1 to the proposed rule change.3 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The ISE proposes to amend ISE Rule 716, ‘‘Block and Solicited Trades,’’ to allow Electronic Access Members (‘‘EAMs’’) to use the ISE’s Facilitation Mechanism to facilitate block-sized complex orders at a net price. The text of the proposed rule change is set forth below. Proposed new language is in italics. Rule 716. Block and Solicited Trades * * * * * Supplementary Material to Rule 716 * * * * * .04 Complex Orders. Electronic Access Members may use the Facilitation Mechanism according to paragraph (d) of this Rule 716 to facilitate block-size complex orders (as defined in Rule 722) at a net price. Members may enter Indications for complex orders at net prices, and bids and offers for complex orders will participate in the execution of an order being facilitated as provided in paragraph (d) of this Rule 716. With respect to bids and offers for the individual legs of a complex order entered into the Facilitation Mechanism, the priority rules for complex orders contained in Rule 722(b)(2) will continue to be applicable. If an improved net price for the complex order being facilitated can be achieved from bids and offers for the individual legs of the complex order in the Exchange’s auction market, the order being facilitated will receive an execution at the better net price. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the ISE included statements concerning the purpose of, and basis for, the proposed rule change and discussed any 3 Amendment No. 1 revises the text of the proposal to refer to ‘‘complex orders’’ rather than ‘‘Complex Orders.’’ The use of the lower case letters in the term ‘‘complex orders’’ is consistent with the ISE’s existing rules. E:\FR\FM\12JYN1.SGM 12JYN1

Agencies

[Federal Register Volume 70, Number 132 (Tuesday, July 12, 2005)]
[Notices]
[Pages 40088-40089]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-3664]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51962; File No. SR-ISE-2005-29]


Self-Regulatory Organizations; International Securities Exchange, 
Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change and Amendment No. 1 Thereto Relating to Fee Changes

July 1, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''), \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on June 6, 2005, the International Securities Exchange, Inc. 
(``ISE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by the ISE. 
On June 20, 2005, ISE filed Amendment No. 1 to the proposed rule 
change.\3\ The ISE has designated this proposal as one establishing or 
changing a due, fee, or other charge imposed by the ISE under Section 
19(b)(3)(A)(ii) of the Act,\4\ and Rule 19b-4(f)(2) thereunder,\5\ 
which renders the proposal effective upon filing with the Commission. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 made a technical change to the text of 
Exhibit 5 (ISE's Schedule of Fees) and added footnote 6 to this rule 
filing. The correction to Exhibit 5 does not affect the fees for 
transactions in options on the five narrow-based indexes that are 
the subject of this filing, but only corrects Exhibit 5 to remove 
asterisks between the Payment for Order Flow section under Execution 
Fees and the Comparison Fee section, since no rule text has been 
omitted between those two sections.
    \4\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \5\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The ISE is proposing to amend its Schedule of Fees to establish 
fees for transactions in options on five narrow-based indexes: the ISE-
CCM Homeland Security Index, the ISE Oil & Gas Services Index, the ISE 
Semiconductors Index, the ISE Gold Index and the ISE Homebuilders 
Index.\6\ The text of the proposed rule change is available on the 
ISE's Web site (http://www.iseoptions.com/legal/proposed_rule_
changes.asp), at the principal office of the ISE, and at the 
Commission's Public Reference Room.
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    \6\ The Exchange represents that the following five narrow-based 
indexes, ISE-CCM Homeland Security Index, the ISE Oil & Gas Services 
Index, the ISE Semiconductors Index, the ISE Gold Index and the ISE 
Homebuilders Index, meet the standards of ISE Rule 2002(b), which 
allows the ISE to begin trading these products by filing Form 19b-
4(e) at least five business days after commencement of trading these 
new products pursuant to Rule 19b-4(e) of the Act. Accordingly, ISE 
filed Form 19b-4(e) with the Commission on June 13, 2005.
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the ISE included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The ISE 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 is proposing to amend its Schedule of Fees to 
establish fees for transactions in options on five narrow-based 
indexes: the ISE-CCM Homeland Security Index (``HSX''), the ISE Oil & 
Gas Services Index (``OOG''), the ISE Semiconductors Index (``BYT''), 
the ISE Gold Index (``HVY''), and the ISE Homebuilders Index (``RUF''). 
Specifically, the Exchange is proposing to adopt an execution fee and a 
comparison fee for all transactions in options on HSX, OOG, BYT, HVY, 
and RUF.\7\ The amount of the execution fee and comparison fee shall be 
the same for all order types on the Exchange--that is, orders for 
Public Customers, Market Makers, and Firm Proprietary--and shall be 
equal to the execution fee and comparison fee currently charged by the 
Exchange for Market Maker and Firm Proprietary transactions in equity 
options.\8\ The Exchange believes the proposed rule change will further 
the Exchange's goal of introducing new products to the marketplace that 
are competitively priced.
---------------------------------------------------------------------------

    \7\ The Exchange represents that these fees will be charged only 
to Exchange members.
    \8\ The execution fee is currently between $.21 and $.12 per 
contract side, depending on the Exchange Average Daily Volume, and 
the comparison fee is currently $.03 per contract side.
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    Additionally, the Exchange has entered into a license agreement 
with Cronus Capital Markets in connection with the listing and trading 
of options on HSX. As with certain other licensed options, the Exchange 
is adopting a surcharge per contract for trading in these options to 
defray the licensing costs.\9\ The Exchange believes that charging the 
participants that trade this instrument is the most equitable means of 
recovering the costs of the license. However, because of competitive 
pressures in the industry, the Exchange proposes to exclude Public 
Customer Orders \10\ from this surcharge fee. Accordingly, this 
surcharge fee will only be charged to Exchange members with respect to 
non-Public Customer Orders (e.g., Market Maker and Firm Proprietary 
orders) and shall apply to Linkage Orders \11\ under a pilot program 
that is set to expire on July 31, 2005. Further, since options on HSX, 
OOG, BYT, HVY, and RUF are not multiply-listed, the Payment for Order 
Flow fee shall not apply.
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    \9\ The Commission notes the proposed fee is five (5) cents per 
contract/side.
    \10\ Public Customer Order is defined in ISE Rule 100(a)(33) as 
an order for the account of a Public Customer. Public Customer is 
defined in ISE Rule 100(a)(32) as a person that is not a broker or 
dealer in securities.
    \11\ See ISE Rule 1900(10).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b)(4) of the Act,\12\ which requires that an exchange 
have an equitable allocation of reasonable dues, fees, and other 
charges among its members and other persons using its facilities.
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    \12\ 15 U.S.C. 78f(b)(4).

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[[Page 40089]]

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

    The Exchange believes that the proposed rule change does not impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing rule change, as amended, establishes or 
changes a due, fee, or other charge imposed by the Exchange, it has 
become effective pursuant to Section 19(b)(3) of the Act \13\ and Rule 
19b-4(f)(2) \14\ thereunder. At any time within 60 days of the filing 
of such amended 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 purposes of 
the Act.\15\
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 19b-4(f)(2).
    \15\ The effective date of the original proposed rule is June 6, 
2005. The effective date of Amendment No. 1 is June 20, 2005. For 
purposes of calculating the 60-day period within which the 
Commission may summarily abrogate the proposed rule change under 
Section 19(b)(3)(C) of the Act, the Commission considers the period 
to commence on June 20, 2005, the date on which the ISE submitted 
Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).
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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. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File No. SR-ISE-2005-29 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-9303.
    All submissions should refer to File Number SR-ISE-2005-29. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commissions Internet Web site (http://www.sec.gov/
rules/sro.shtml). 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 also will be available for inspection and copying at the 
principal office of the ISE.All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-ISE-2005-29 and should be submitted by August 2, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. E5-3664 Filed 7-11-05; 8:45 am]
BILLING CODE 8010-01-P