Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to Transaction Fees Assessed on DIAMONDS Options, 61857-61859 [E5-5945]
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Federal Register / Vol. 70, No. 206 / Wednesday, October 26, 2005 / Notices
the sell side of a transaction. However,
when the exchange accepts an ITS
commitment to buy, the ultimate seller
is a party on another market. The
exchange lacks the ability to pass a fee
to that seller directly, because the seller
may not be a member of the exchange.
Under the proposed arrangement, which
the Commission understands will be
adopted by each of the ITS participant
exchanges,17 the exchange that routed
the ITS commitment away will continue
to collect a fee from the broker-dealer
that placed the sell order. Then, with
respect to each ITS participant
exchange, the exchange will determine
whether it is a net sender or net receiver
of ITS trades and send fees to or accept
fees from each other exchange
accordingly. The Commission believes
this is an equitable manner for the
exchanges to obtain funds to pay their
Section 31 fees on covered sales
resulting from ITS trades.
Under Section 19(b)(2) of the Act,18
the Commission may not approve any
proposed rule change prior to the
thirtieth day after the date of
publication of the notice of filing
thereof, unless the Commission finds
good cause for so doing. The
Commission hereby finds good cause for
approving the proposed rule change
prior to the thirtieth day after
publishing notice of filing thereof in the
Federal Register. In this case, the
Commission does not believe a
comment period is necessary because all
of the parties affected by the proposed
fee—the other ITS participant
exchanges—have already consented to
and will adopt the same fee
arrangement.19
For the reasons set forth above, the
Commission finds good cause to
accelerate approval of the proposed rule
change pursuant to Section 19(b)(2) of
the Act.20
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,21 that the
proposed rule change (SR–BSE–2005–
41) is hereby approved on an
accelerated basis.
17 See letter from George W. Mann, Jr., Executive
Vice President and General Counsel, BSE, and
Chairman, Subcommittee, to Michael Gaw,
Assistant Director, Division, Commission, dated
September 29, 2005.
18 15 U.S.C. 78s(b)(2).
19 See supra note 17.
20 Id.
21 Id.
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For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.22
Jonathan G. Katz,
Secretary.
[FR Doc. E5–5921 Filed 10–25–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–52643; File No. SR–CBOE–
2005–71]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change and Amendment Nos. 1
and 2 Thereto Relating to Transaction
Fees Assessed on DIAMONDS Options
October 20, 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
September 1, 2005, the Chicago Board
Options Exchange, Incorporated
(‘‘CBOE’’ 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 CBOE. On September 8, 2005, the
CBOE submitted Amendment No. 1 to
the proposed rule change.3 On October
17, 2005, the CBOE submitted
Amendment No. 2 to the proposed rule
change.4 The CBOE has designated this
proposal as one establishing or changing
a due, fee, or other charge imposed by
the CBOE under section 19(b)(3)(A)(ii)
of the Act,5 and Rule 19b–4(f)(2)
thereunder,6 which renders the proposal
effective upon filing with the
Commission.7 The Commission is
22 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 In Amendment No. 1, the Exchange made a
technical change to the proposed rule text.
4 In Amendment No. 2, the Exchange revised the
proposed rule text to amend the transaction fees
assessed to non-member market makers for orders
in DIA options sent to CBOE through the
Intermarket Options Linkage (‘‘Linkage’’) and
outside of Linkage. The Exchange states that the
transaction fees assessed to non-member marketmakers for orders in DIA options sent to CBOE
through Linkage or outside of Linkage will be
implemented on November 1, 2005.
5 15 U.S.C. 78s(b)(3)(A)(ii).
6 17 CFR 240.19b–4(f)(2).
7 The effective date of the original proposed rule
change is September 1, 2005, the effective date of
Amendment No. 1 is September 8, 2005, and the
effective date of Amendment No. 2 is October 17,
2005. For purposes of calculating the 60-day period
within which the Commission may summarily
abrogate the proposed rule change, as amended,
under Section 19(b)(3)(C) of the Act, the
1 15
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61857
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 Exchange proposes to amend its
Fees Schedule relating to fees for
options on the DIAMONDS (‘‘DIA’’).
The text of the proposed rule change is
available on the Exchange’s Web site
(https://www.cboe.com), at the
Exchange’s Office of the Secretary, and
at the Commission’s Public Reference
Room. The text of the proposed rule
change is also included below. Proposed
new language is italicized; proposed
deletions are in [brackets].
Chicago Board Options Exchange, Inc.—
Fees Schedule
[August 24]September 1, 2005
1. Options Transaction Fees
(1)(3)(4)(7)(16): Per Contract.
Equity Options (13):
I.–IX. Unchanged.
QQQQ and SPDR OPTIONS:
I.–VII. Unchanged.
INDEX OPTIONS (includes Dow Jones
DIAMONDS, OEF and other ETF and
HOLDRs options):
I. CUSTOMER (2):
S&P 100, PREMIUM > or = $1 ...
S&P 100, PREMIUM < $1 ...........
MNX and NDX .............................
RUT and [REDUCED VALUE
RUSSELL 2000]RMN ..............
ETF and HOLDRs options
[(except DIA)] ...........................
OTHER INDEXES, PREMIUM >
OR = $1 ...................................
OTHER INDEXES, PREMIUM <
$1 .............................................
II. MARKET-MAKER AND DPM—EXCLUDING DOW JONES PRODUCTS:
OTHER THAN DIA (10) ..............
MARKET-MAKER—DOW
JONES PRODUCTS (except
DIA) (10) ..................................
III. MEMBER FIRM PROPRIETARY:
(11)
FACILITATION OF CUSTOMER
ORDER, MNX and NDX ..........
FACILITATION OF CUSTOMER
ORDER, OTHER INDEXES ....
NON-FACILITATION ORDER .....
IV. BROKER-DEALER (EXCLUDING
THE PRODUCTS BELOW) INDEX
CUSTOMER RATES:
ETF (except DIA), HOLDRS,
RUT and [REDUCED VALUE
RUSSELL 2000]RMN, PREMIUM > or = $1 .......................
$.35
.20
.15
.15
.15
.45
.25
.24
.34
.24
.20
.24
.45
Commission considers the period to commence on
October 17, 2005, the date on which the Exchange
submitted Amendment No. 2. See 15 U.S.C.
78s(b)(3)(C).
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Federal Register / Vol. 70, No. 206 / Wednesday, October 26, 2005 / Notices
ETF (except DIA), HOLDRS,
RUT and [REDUCED VALUE
RUSSELL 2000]RMN, PREMIUM < $1 ...............................
DIA, MNX and NDX .....................
V. NON-MEMBER MARKET MAKER:
DIA ...............................................
S&P 100 (including OEF), PREMIUM > or = $1 .......................
S&P 100 (including OEF), PREMIUM < $1 ...............................
OTHER INDEXES, PREMIUM >
or = $1 .....................................
OTHER INDEXES, PREMIUM <
$1 .............................................
VI. MNX and NDX LICENSE FEE
(15)
VII. RUT DPM and MARKET MAKER
LICENSE FEE
(Russell 2000 cash settled index)
(12) ...........................................
VIII. LINKAGE ORDERS (8)(15):
DIA ...............................................
S&P 100 (OEF), PREMIUM > or
= $1 ..........................................
S&P 100 (OEF), PREMIUM < $1
OTHER INDEXES, PREMIUM >
or = $1 .....................................
OTHER INDEXES, PREMIUM <
$1 .............................................
.25
.25
$.26
.37
.22
.47
.27
.10
.10
.26
.35
.20
.45
.25
2. MARKET-MAKER, RMM, e-DPM &
DPM MARKETING FEE (in option
classes in which a DPM has been
appointed) (6)(16): Unchanged.
3. FLOOR BROKERAGE FEE
(1)(5)(16): Unchanged.
4. RAES ACCESS FEE (RETAIL
AUTOMATIC EXECUTION SYSTEM)
(1)(4)(16): Unchanged.
*
*
*
*
*
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
CBOE included statements concerning
the purpose of, and basis for, the
proposed rule change, as amended, and
discussed any comments it received on
the proposed rule change, as amended.
The text of these statements may be
examined at the places specified in Item
IV below. The CBOE 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 proposes to amend its
Fees Schedule to amend certain fees for
DIA options. Specifically, the Exchange
proposes to reduce customer and
broker-dealer fees for transactions in
DIA options, amend non-member
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market-maker fees for orders in DIA
options sent to CBOE through Linkage
and outside of Linkage,8 and eliminate
the market-maker license fee surcharge
applicable to transactions in DIA
options.
In particular, the transaction fees for
public customer transactions in DIA
options are currently $.45 per contract
if the premium is equal to or greater
than $1, and $.25 per contract if the
premium is less than $1. The Exchange
proposes to reduce the transaction fees
for public customer transactions in DIA
options to $.15 per contract, regardless
of the premium. Moreover, the
transaction fees for broker-dealer
transactions in DIA options are
currently $.45 per contract if the
premium is equal to or greater than $1,
and $.25 per contract if the premium is
less than $1. The Exchange proposes to
reduce the transaction fees for brokerdealer transactions in DIA options to
$.25 per contract, regardless of the
premium. Further, the transaction fees
for non-member market-maker
transactions in DIA options are
currently $.47 per contract if the
premium is greater than or equal to $1,
and $.27 per contract if the premium is
less than $1. The transaction fees
assessed to non-member market-makers
for orders in DIA options sent to CBOE
through Linkage are currently $.45 per
contract if the premium is greater than
or equal to $1, and $.25 per contract if
the premium is less than $1. The
Exchange proposes to change both the
non-member market maker transaction
fee and the Linkage transaction fee for
transactions in DIA options to $.26 per
contract, regardless of the premium.9
In addition, the Exchange currently
charges market-makers that trade Dow
Jones products, including DIA options,
a license fee of $.10 per contract in
addition to the regular transaction fee of
$.24 per contract, to assist the Exchange
in offsetting some of the royalty fees the
Exchange must pay to Dow Jones for its
license to trade Dow Jones products.10
The Exchange proposes to eliminate the
$.10 license fee solely with respect to
market-maker transactions in DIA
options.11
8 See
Amendment No. 2, supra note 4.
Amendment No. 2, supra note 4. According
to CBOE, the proposed changes to the transaction
fees assessed to non-member market-makers for
orders in DIA options sent to CBOE through
Linkage or outside of Linkage will be implemented
on November 1, 2005.
10 See Securities Exchange Act Release No. 48223
(July 24, 2003), 68 FR 44978, 44979 (July 31, 2003).
11 The Commission notes that the Exchange
currently charges market-makers that trade Dow
Jones products, including DIA options, a total fee
of $.34 per contract, which reflects a $.10 licensing
fee surcharge. Under the proposed rule change, the
9 See
PO 00000
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Fmt 4703
Sfmt 4703
The proposed rule change, as
amended, is intended to establish fees
for CBOE’s DIA options that will be
competitive with fees charged by other
exchanges for transactions in DIA
options.
The Exchange also proposes to make
a minor technical amendment to its Fees
Schedule to change references relating
to ‘‘Reduced Value Russell 2000’’
options to its ticker symbol, ‘‘RMN.’’
2. Statutory Basis
The CBOE believes that the proposed
rule change, as amended, is consistent
with section 6(b) of the Act,12 in
general, and furthers the objectives of
section 6(b)(4) of the Act,13 in
particular, in that it is designed to
provide for the equitable allocation of
reasonable dues, fees, and other charges
among CBOE members.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The CBOE does not believe that the
proposed rule change, as amended, will
impose any burden on competition.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change,
as amended, has been designated as a
fee change pursuant to section
19(b)(3)(A)(ii) of the Act 14 and Rule
19b–4(f)(2) 15 thereunder, because it
establishes or changes a due, fee or
other charge imposed by the Exchange.
Accordingly, the proposal will take
effect upon filing with the
Commission.16 At any time within 60
days of the filing of the proposed rule
change, as amended, 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.17
fee for market-makers that trade DIA options will
be $.24 per contract.
12 15 U.S.C. 78f(b).
13 15 U.S.C. 78f(b)(4).
14 15 U.S.C. 78s(b)(3)(A)(ii).
15 17 CFR 240.19b–4(f)(2).
16 See supra note 7.
17 Id.
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Federal Register / Vol. 70, No. 206 / Wednesday, October 26, 2005 / Notices
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.18
Jonathan G. Katz,
Secretary.
[FR Doc. E5–5945 Filed 10–25–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–CBOE–2005–71 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Jonathan G. Katz, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–9303.
[Release No. 34–52631; File No. SR–FICC–
2005–14]
Self-Regulatory Organizations; Fixed
Income Clearing Corporation; Notice of
Filing of a Proposed Rule Change
Relating to the Federal Reserve’s
National Settlement System
October 18, 2005.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 notice is hereby given that on
September 9, 2005, Fixed Income
Clearing Corporation (‘‘FICC’’) filed
All submissions should refer to File
with the Securities and Exchange
Number SR–CBOE–2005–71. This file
Commission (‘‘Commission’’) the
number should be included on the
proposed rule change as described in
subject line if e-mail is used. To help the Items I, II, and III below, which items
Commission process and review your
have been prepared primarily by FICC.
comments more efficiently, please use
The Commission is publishing this
only one method. The Commission will notice to solicit comments on the
post all comments on the Commission’s proposed rule change from interested
persons.
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
I. Self-Regulatory Organization’s
submission, all subsequent
Statement of the Terms of Substance of
amendments, all written statements
the Proposed Rule Change
with respect to the proposed rule
The proposed rule change would
change, as amended, that are filed with
amend the rules of FICC’s Government
the Commission, and all written
Securities Division (‘‘GSD’’) to have
communications relating to the
funds-only settlement obligation
proposed rule change, as amended,
payment processing occur through the
between the Commission and any
Federal Reserve’s National Settlement
person, other than those that may be
withheld from the public in accordance System (‘‘NSS’’).
with the provisions of 5 U.S.C. 552, will II. Self-Regulatory Organization’s
be available for inspection and copying
Statement of the Purpose of, and
in the Commission’s Public Reference
Statutory Basis for, the Proposed Rule
Room. Copies of such filing also will be Change
available for inspection and copying at
In its filing with the Commission,
the principal office of the CBOE. All
FICC included statements concerning
comments received will be posted
the purpose of and basis for the
without change; the Commission does
proposed rule change and discussed any
not edit personal identifying
comments it received on the proposed
information from submissions. You
rule change. The text of these statements
should submit only information that
may be examined at the places specified
you wish to make available publicly. All
in Item IV below. FICC has prepared
submissions should refer to File
summaries, set forth in Sections (A), (B),
Number SR–CBOE–2005–71 and should and (C) below, of the most significant
be submitted on or before November 16, aspects of such statements.2
2005.
18 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 The Commission has modified parts of these
statements.
1 15
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61859
(A) Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
The purpose of the proposed rule
change is to amend the rules of GSD to
require netting members to satisfy their
funds-only settlement amounts
ultimately through the Federal Reserve’s
NSS.3 GSD’s funds-only settlement
process is set forth in GSD Rule 13. On
a daily basis, FICC reports a funds-only
settlement amount, which is either a
debit amount or a credit amount, to each
netting member. Each netting member
that has a debit is required to satisfy its
obligation by the applicable deadline.
Netting members with credits are
subsequently paid by FICC by the
applicable deadline. All payments of
funds-only settlement amounts by a
netting member to FICC and all
collections of funds-only settlement
amounts by a netting member from FICC
are done through depository institutions
that are designated by such netting
member and FICC to act on their
behalves with regard to such payments
and collections. All payments are made
by fund wires from one depository
institution to the other.
In 1997, the Commission approved an
enhancement to GSCC’s 4 funds-only
settlement payment processing (‘‘1997
Filing’’).5 This enhancement gave
members the option to participate in an
auto-debit arrangement that was to
eliminate the need to send fund wires
for the satisfaction of funds-only
settlement payments. Under the autodeposit arrangement, GSCC, the netting
member, and the netting member’s
depository institution would enter into
a ‘‘funds-only settlement procedures
agreement’’ whereby the depository
institution would pay or collect fundsonly settlement amounts on behalf of
the netting member and GSCC through
accounts of the member at the
depository institution. As a result, the
3 This is consistent with the manner in which
FICC’s affiliates, The Depository Trust Company
(‘‘DTC’’) and the National Securities Clearing
Corporation (‘‘NSCC’’), handle their funds
settlement process. DTC and NSCC do not currently
use NSS for the processing of funds credits,
whereas FICC is proposing to have the GSD process
both the debits and credits of its funds-only
settlement process through NSS.
4 The Government Securities Clearing
Corporation (‘‘GSCC’’) was the predecessor to GSD.
GSCC became the GSD division of FICC when GSCC
and the Mortgage Backed Securities Clearing
Corporation were merged to create FICC in 2002.
5 Securities Exchange Act Release No. 39309
(November 7, 1997), 62 FR 61158 (November 14,
1997) [File No. SR–GSCC–97–06].
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]]>Agencies
[Federal Register Volume 70, Number 206 (Wednesday, October 26, 2005)]
[Notices]
[Pages 61857-61859]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-5945]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-52643; File No. SR-CBOE-2005-71]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change and Amendment Nos. 1 and 2 Thereto Relating to
Transaction Fees Assessed on DIAMONDS Options
October 20, 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 September 1, 2005, the Chicago Board Options Exchange, Incorporated
(``CBOE'' 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 CBOE.
On September 8, 2005, the CBOE submitted Amendment No. 1 to the
proposed rule change.\3\ On October 17, 2005, the CBOE submitted
Amendment No. 2 to the proposed rule change.\4\ The CBOE has designated
this proposal as one establishing or changing a due, fee, or other
charge imposed by the CBOE under section 19(b)(3)(A)(ii) of the Act,\5\
and Rule 19b-4(f)(2) thereunder,\6\ which renders the proposal
effective upon filing with the Commission.\7\ The Commission is
publishing this notice to solicit comments on the proposed rule change,
as amended, from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ In Amendment No. 1, the Exchange made a technical change to
the proposed rule text.
\4\ In Amendment No. 2, the Exchange revised the proposed rule
text to amend the transaction fees assessed to non-member market
makers for orders in DIA options sent to CBOE through the
Intermarket Options Linkage (``Linkage'') and outside of Linkage.
The Exchange states that the transaction fees assessed to non-member
market-makers for orders in DIA options sent to CBOE through Linkage
or outside of Linkage will be implemented on November 1, 2005.
\5\ 15 U.S.C. 78s(b)(3)(A)(ii).
\6\ 17 CFR 240.19b-4(f)(2).
\7\ The effective date of the original proposed rule change is
September 1, 2005, the effective date of Amendment No. 1 is
September 8, 2005, and the effective date of Amendment No. 2 is
October 17, 2005. For purposes of calculating the 60-day period
within which the Commission may summarily abrogate the proposed rule
change, as amended, under Section 19(b)(3)(C) of the Act, the
Commission considers the period to commence on October 17, 2005, the
date on which the Exchange submitted Amendment No. 2. See 15 U.S.C.
78s(b)(3)(C).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend its Fees Schedule relating to fees
for options on the DIAMONDS [reg] (``DIA''). The text of the proposed
rule change is available on the Exchange's Web site (https://
www.cboe.com), at the Exchange's Office of the Secretary, and at the
Commission's Public Reference Room. The text of the proposed rule
change is also included below. Proposed new language is italicized;
proposed deletions are in [brackets].
Chicago Board Options Exchange, Inc.--Fees Schedule
[August 24]September 1, 2005
1. Options Transaction Fees (1)(3)(4)(7)(16): Per Contract.
Equity Options (13):
I.-IX. Unchanged.
QQQQ and SPDR OPTIONS:
I.-VII. Unchanged.
INDEX OPTIONS (includes Dow Jones DIAMONDS, OEF and other ETF and
HOLDRs options):
I. CUSTOMER (2):
S&P 100, PREMIUM > or = $1.................................. $.35
S&P 100, PREMIUM < $1....................................... .20
MNX and NDX................................................. .15
RUT and [REDUCED VALUE RUSSELL 2000]RMN..................... .15
ETF and HOLDRs options [(except DIA)]....................... .15
OTHER INDEXES, PREMIUM > OR = $1............................ .45
OTHER INDEXES, PREMIUM < $1................................. .25
II. MARKET-MAKER AND DPM--EXCLUDING DOW JONES PRODUCTS:
OTHER THAN DIA (10)......................................... .24
MARKET-MAKER--DOW JONES PRODUCTS (except DIA) (10).......... .34
III. MEMBER FIRM PROPRIETARY: (11)
FACILITATION OF CUSTOMER ORDER, MNX and NDX................. .24
FACILITATION OF CUSTOMER ORDER, OTHER INDEXES............... .20
NON-FACILITATION ORDER...................................... .24
IV. BROKER-DEALER (EXCLUDING THE PRODUCTS BELOW) INDEX CUSTOMER
RATES:
ETF (except DIA), HOLDRS, RUT and [REDUCED VALUE RUSSELL .45
2000]RMN, PREMIUM > or = $1................................
[[Page 61858]]
ETF (except DIA), HOLDRS, RUT and [REDUCED VALUE RUSSELL .25
2000]RMN, PREMIUM < $1.....................................
DIA, MNX and NDX............................................ .25
V. NON-MEMBER MARKET MAKER:
DIA......................................................... $.26
S&P 100 (including OEF), PREMIUM > or = $1.................. .37
S&P 100 (including OEF), PREMIUM < $1....................... .22
OTHER INDEXES, PREMIUM > or = $1............................ .47
OTHER INDEXES, PREMIUM < $1................................. .27
VI. MNX and NDX LICENSE FEE (15) .10
VII. RUT DPM and MARKET MAKER LICENSE FEE
(Russell 2000 cash settled index) (12)...................... .10
VIII. LINKAGE ORDERS (8)(15):
DIA......................................................... .26
S&P 100 (OEF), PREMIUM > or = $1............................ .35
S&P 100 (OEF), PREMIUM < $1................................. .20
OTHER INDEXES, PREMIUM > or = $1............................ .45
OTHER INDEXES, PREMIUM < $1................................. .25
2. MARKET-MAKER, RMM, e-DPM & DPM MARKETING FEE (in option classes
in which a DPM has been appointed) (6)(16): Unchanged.
3. FLOOR BROKERAGE FEE (1)(5)(16): Unchanged.
4. RAES ACCESS FEE (RETAIL AUTOMATIC EXECUTION SYSTEM) (1)(4)(16):
Unchanged.
* * * * *
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 CBOE included statements
concerning the purpose of, and basis for, the proposed rule change, as
amended, and discussed any comments it received on the proposed rule
change, as amended. The text of these statements may be examined at the
places specified in Item IV below. The CBOE 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 proposes to amend its Fees Schedule to amend certain
fees for DIA options. Specifically, the Exchange proposes to reduce
customer and broker-dealer fees for transactions in DIA options, amend
non-member market-maker fees for orders in DIA options sent to CBOE
through Linkage and outside of Linkage,\8\ and eliminate the market-
maker license fee surcharge applicable to transactions in DIA options.
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\8\ See Amendment No. 2, supra note 4.
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In particular, the transaction fees for public customer
transactions in DIA options are currently $.45 per contract if the
premium is equal to or greater than $1, and $.25 per contract if the
premium is less than $1. The Exchange proposes to reduce the
transaction fees for public customer transactions in DIA options to
$.15 per contract, regardless of the premium. Moreover, the transaction
fees for broker-dealer transactions in DIA options are currently $.45
per contract if the premium is equal to or greater than $1, and $.25
per contract if the premium is less than $1. The Exchange proposes to
reduce the transaction fees for broker-dealer transactions in DIA
options to $.25 per contract, regardless of the premium. Further, the
transaction fees for non-member market-maker transactions in DIA
options are currently $.47 per contract if the premium is greater than
or equal to $1, and $.27 per contract if the premium is less than $1.
The transaction fees assessed to non-member market-makers for orders in
DIA options sent to CBOE through Linkage are currently $.45 per
contract if the premium is greater than or equal to $1, and $.25 per
contract if the premium is less than $1. The Exchange proposes to
change both the non-member market maker transaction fee and the Linkage
transaction fee for transactions in DIA options to $.26 per contract,
regardless of the premium.\9\
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\9\ See Amendment No. 2, supra note 4. According to CBOE, the
proposed changes to the transaction fees assessed to non-member
market-makers for orders in DIA options sent to CBOE through Linkage
or outside of Linkage will be implemented on November 1, 2005.
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In addition, the Exchange currently charges market-makers that
trade Dow Jones products, including DIA options, a license fee of $.10
per contract in addition to the regular transaction fee of $.24 per
contract, to assist the Exchange in offsetting some of the royalty fees
the Exchange must pay to Dow Jones for its license to trade Dow Jones
products.\10\ The Exchange proposes to eliminate the $.10 license fee
solely with respect to market-maker transactions in DIA options.\11\
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\10\ See Securities Exchange Act Release No. 48223 (July 24,
2003), 68 FR 44978, 44979 (July 31, 2003).
\11\ The Commission notes that the Exchange currently charges
market-makers that trade Dow Jones products, including DIA options,
a total fee of $.34 per contract, which reflects a $.10 licensing
fee surcharge. Under the proposed rule change, the fee for market-
makers that trade DIA options will be $.24 per contract.
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The proposed rule change, as amended, is intended to establish fees
for CBOE's DIA options that will be competitive with fees charged by
other exchanges for transactions in DIA options.
The Exchange also proposes to make a minor technical amendment to
its Fees Schedule to change references relating to ``Reduced Value
Russell 2000'' options to its ticker symbol, ``RMN.''
2. Statutory Basis
The CBOE believes that the proposed rule change, as amended, is
consistent with section 6(b) of the Act,\12\ in general, and furthers
the objectives of section 6(b)(4) of the Act,\13\ in particular, in
that it is designed to provide for the equitable allocation of
reasonable dues, fees, and other charges among CBOE members.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The CBOE does not believe that the proposed rule change, as
amended, will impose any burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change, as amended, has been designated
as a fee change pursuant to section 19(b)(3)(A)(ii) of the Act \14\ and
Rule 19b-4(f)(2) \15\ thereunder, because it establishes or changes a
due, fee or other charge imposed by the Exchange. Accordingly, the
proposal will take effect upon filing with the Commission.\16\ At any
time within 60 days of the filing of the proposed rule change, as
amended, 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.\17\
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\14\ 15 U.S.C. 78s(b)(3)(A)(ii).
\15\ 17 CFR 240.19b-4(f)(2).
\16\ See supra note 7.
\17\ Id.
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[[Page 61859]]
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change, as amended, is consistent with the Act. Comments may be
submitted by any of the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-CBOE-2005-71 on the subject line.
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-9303.
All submissions should refer to File Number SR-CBOE-2005-71. 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 Commission's Internet Web site (https://www.sec.gov/rules/
sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change, as
amended, that are filed with the Commission, and all written
communications relating to the proposed rule change, as amended,
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 CBOE. 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-CBOE-2005-71 and should be
submitted on or before November 16, 2005.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. E5-5945 Filed 10-25-05; 8:45 am]
BILLING CODE 8010-01-P
