Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Transaction Fees and a Fee Waiver for Options on the Mini-SPX, 73042-73043 [E5-7067]

Download as PDF 73042 Federal Register / Vol. 70, No. 235 / Thursday, December 8, 2005 / Notices IOPV for the Shares every 15 seconds from 9:30 a.m. to 4:15 p.m. E.T. The Exchange will cease trading in the Shares if (a) the primary market stops trading the Shares because of a regulatory halt similar to a halt based on Amex Rule 117 and/or a halt because dissemination of the IOPV and/or underlying index value has ceased or (b) the primary market delists the Shares. In support of this proposed rule change, the Exchange has made the following representations: 1. Amex has appropriate rules to facilitate transactions in this type of security; 2. Amex surveillance procedures are adequate to properly monitor the trading of the Shares on the Exchange; 3. Amex will distribute an Information Circular to its members prior to the commencement of trading of the Shares on the Exchange that explains the terms, characteristics, and risks of trading such shares; 4. Amex will require a member with a customer that purchases the Shares on the Exchange to provide that customer with a product prospectus and will note this prospectus delivery requirement in the Information Circular; and 5. Amex will cease trading in the Shares if (a) the primary market stops trading the Shares because of a regulatory halt similar to a halt based on Amex Rule 117 and/or a halt because dissemination of the IOPV and/or underlying index value has ceased or (b) the primary market delists the Shares. This approval order is conditioned on Amex’s adherence to these representations. The Commission finds good cause for approving this proposed rule change, as amended, before the thirtieth day after the publication of notice thereof in the Federal Register. As noted earlier, the Commission previously found that the listing and trading of these Shares on the NYSE are consistent with the Act.22 The Commission presently is not aware of any issue that would cause it to revisit that earlier finding or preclude the trading of these funds on the Exchange pursuant to UTP. Therefore, accelerating approval of this proposed rule change should benefit investors by creating, without undue delay, additional competition in the market for these Shares. V. Conclusion It is therefore ordered, pursuant to section 19(b)(2) of the Act, that the proposed rule change (SR–Amex–2005– 22 See NYSE Order, supra note 5. VerDate Aug<31>2005 16:29 Dec 07, 2005 Jkt 208001 091), as amended, is hereby approved on an accelerated basis.23 For the Commission, by the Division of Market Regulation, pursuant to delegated authority.24 Jonathan G. Katz, Secretary. [FR Doc. E5–7057 Filed 12–7–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52871; File No. SR–CBOE– 2005–88] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Transaction Fees and a Fee Waiver for Options on the Mini-SPX December 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 October 25, 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 and II below, which Items have been prepared by the Exchange. On December 1, 2005, the Exchange filed Amendment No. 1 to the proposed rule change.3 The CBOE submitted the proposed rule change under Section 19(b)(3)(A) 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. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend its Fees Schedule to establish fees for options on the Mini-SPX (‘‘XSP’’). The Exchange also proposes to waive all fees for trading in XSP options beginning with the launch of trading through 23 15 U.S.C. 78s(b)(2). 24 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 In Amendment No. 1, the Exchange proposed to reduce the XSP non-member market-maker transaction fee to $.17 per contract regardless of the premium. 4 15 U.S.C. 78s(b)(3)(A). 5 17 CFR 240.19b–4(f)(2). PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 January 31, 2006. 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. 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 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 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 a. XSP Fees The Exchange proposes to establish fees for XSP options, which commenced trading on October 25, 2005. XSP options are options that are based on one-tenth the value of the Standard & Poor’s 500 Index. XSP options trade on CBOE’s Hybrid 2.0 trading system. The transaction fee for customer orders in XSP options will be $.15 per contract. The market-maker transaction fee will also be $.15 per contract.6 The Exchange believes the $.15 marketmaker transaction fee will act as an incentive for market-makers to provide liquidity in the XSP product. Member firm proprietary transaction fees will be $.20 for facilitation of customer orders and $.24 for non-facilitation orders. The broker-dealer transaction fee will be $.25 per contract, the remote marketmaker transaction fee will be $.26 per contract, and the non-member marketmaker fee will be $.17 per contract. As per the current CBOE Fee Schedule, the floor brokerage fee for XSP options will be $.04 per contract and $.02 per contract for crossed orders. The Marketing Fee and the RAES Access Fee will not apply. b. Fee Waiver The Exchange proposes to waive all fees for trading in XSP options beginning with the launch of trading in XSP options through January 31, 2006. 6 XSP options trade without a Designated Primary Market-Maker (‘‘DPM’’), Electronic-DPM (‘‘e-DPM’’) or Lead Market-Maker (‘‘LMM’’), under CBOE’s index option hybrid rules. E:\FR\FM\08DEN1.SGM 08DEN1 Federal Register / Vol. 70, No. 235 / Thursday, December 8, 2005 / Notices 73043 Following the fee waiver period, the Exchange will begin assessing the fees set forth above. The Exchange has decided to waive all XSP fees to promote the launch of the XSP product. 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: SECURITIES AND EXCHANGE COMMISSION 2. Statutory Basis Electronic Comments The Exchange believes that the proposed rule change, as amended, is consistent with Section 6(b) of the Act,7 in general, and furthers the objectives of Section 6(b)(4) of the Act,8 in particular, in that it provides for the equitable allocation of reasonable dues, fees, and other charges among CBOE’s members and other persons using its facilities. • 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–2005–88 on the subject line. Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of Proposed Rule Change To Prohibit the Practice of Unbundling Orders to Maximize Rebates of Fees B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change, as amended, will 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 neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The proposed rule change, as amended, has become effective upon filing pursuant to Section 19(b)(3)(A) of the Act 9 and subparagraph (f)(2) of Rule 19b–4 thereunder,10 because it establishes or changes a due, fee, or other charge imposed by the CBOE. 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.11 IV. Solicitation of Comments Interested persons are invited to submit written data, views, and 7 15 U.S.C. 78s(b)(3)(A). U.S.C. 78f(b)(4). 9 15 U.S.C. 78s(b)(3)(A). 10 17 CFR 240.19b–4(f)(2). 11 The effective date of the original proposed rule change is October 25, 2005 and the effective date of the amendment is December 1, 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 December 1, 2005, the date on which the Exchange submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). 8 15 VerDate Aug<31>2005 16:29 Dec 07, 2005 Jkt 208001 [Release No. 34–52872; File No. SR–CBOE– 2005–92] December 1, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934, as amended, (‘‘Act’’) 1 and Rule 19b–4 Paper Comments thereunder,2 notice is hereby given that • Send paper comments in triplicate on November 7, 2005, the Chicago to Jonathan G. Katz, Secretary, Board Options Exchange, Incorporated Securities and Exchange Commission, (‘‘CBOE’’ or ‘‘Exchange’’) filed with the Station Place, 100 F Street, NE., Securities and Exchange Commission Washington, DC 20549–9303. (‘‘Commission’’) the proposed rule change as described in Items I, II, and All submissions should refer to File III below, which Items have been Number SR–CBOE–2005–88. This file prepared by the Exchange. The number should be included on the subject line if e-mail is used. To help the Commission is publishing this notice to solicit comments on the proposed rule Commission process and review your change from interested persons. comments more efficiently, please use only one method. The Commission will I. Self-Regulatory Organization’s post all comments on the Commission’s Statement of the Terms of Substance of Internet Web site (https://www.sec.gov/ the Proposed Rule Change rules/sro.shtml). Copies of the CBOE proposes to adopt a new rule to submission, all subsequent prohibit the practice of unbundling amendments, all written statements orders in order to maximize rebates of with respect to the proposed rule fees. The text of the proposed rule change that are filed with the change appears below. Additions are in Commission, and all written italics. communications relating to the * * * * * proposed rule change between the Commission and any person, other than Rule 4.23—Unbundling of Orders to those that may be withheld from the Maximize Rebates of Fees public in accordance with the Rule 4.23. No member shall divide an provisions of 5 U.S.C. 552, will be order into multiple smaller orders for available for inspection and copying in the primary purpose of maximizing the Commission’s Public Reference Room. Copies of such filing also will be rebates of fees resulting from the execution of such orders, or any other available for inspection and copying at similar payment of value to the member. the principal offices of CBOE. All comments received will be posted * * * * * without change; the Commission does II. Self-Regulatory Organization’s not edit personal identifying Statement of the Purpose of, and information from submissions. You Statutory Basis for, the Proposed Rule should submit only information that you wish to make available publicly. All Change In its filing with the Commission, the submissions should refer to File Number SR–CBOE–2005–88 and should CBOE included statements concerning be submitted on or before December 29, the purpose of, and basis for, the proposed rule change and discussed any 2005. comments it received on the proposed For the Commission, by the Division of rule change. The text of these statements Market Regulation, pursuant to delegated may be examined at the places specified 12 authority. in Item IV below. The CBOE has Jonathan G. Katz, prepared summaries, set forth in Secretary. Sections A, B, and C below, of the most [FR Doc. E5–7067 Filed 12–7–05; 8:45 am] significant aspects of such statements. BILLING CODE 8010–01–P 1 15 12 17 PO 00000 CFR 200.30–3(a)(12). Frm 00067 Fmt 4703 Sfmt 4703 2 17 E:\FR\FM\08DEN1.SGM U.S.C. 78s(b)(l). CFR 240.19b–4. 08DEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 70, Number 235 (Thursday, December 8, 2005)]
[Notices]
[Pages 73042-73043]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-7067]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52871; File No. SR-CBOE-2005-88]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change and Amendment No. 1 Thereto Relating to Transaction Fees 
and a Fee Waiver for Options on the Mini-SPX

December 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 October 25, 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 and II below, which Items have been prepared by the Exchange. 
On December 1, 2005, the Exchange filed Amendment No. 1 to the proposed 
rule change.\3\ The CBOE submitted the proposed rule change under 
Section 19(b)(3)(A) 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, the Exchange proposed to reduce the XSP 
non-member market-maker transaction fee to $.17 per contract 
regardless of the premium.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Fees Schedule to establish fees 
for options on the Mini-SPX (``XSP''). The Exchange also proposes to 
waive all fees for trading in XSP options beginning with the launch of 
trading through January 31, 2006. 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.

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 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 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

a. XSP Fees

    The Exchange proposes to establish fees for XSP options, which 
commenced trading on October 25, 2005. XSP options are options that are 
based on one-tenth the value of the Standard & Poor's 500 Index. XSP 
options trade on CBOE's Hybrid 2.0 trading system.
    The transaction fee for customer orders in XSP options will be $.15 
per contract. The market-maker transaction fee will also be $.15 per 
contract.\6\ The Exchange believes the $.15 market-maker transaction 
fee will act as an incentive for market-makers to provide liquidity in 
the XSP product. Member firm proprietary transaction fees will be $.20 
for facilitation of customer orders and $.24 for non-facilitation 
orders. The broker-dealer transaction fee will be $.25 per contract, 
the remote market-maker transaction fee will be $.26 per contract, and 
the non-member market-maker fee will be $.17 per contract.
---------------------------------------------------------------------------

    \6\ XSP options trade without a Designated Primary Market-Maker 
(``DPM''), Electronic-DPM (``e-DPM'') or Lead Market-Maker 
(``LMM''), under CBOE's index option hybrid rules.
---------------------------------------------------------------------------

    As per the current CBOE Fee Schedule, the floor brokerage fee for 
XSP options will be $.04 per contract and $.02 per contract for crossed 
orders. The Marketing Fee and the RAES Access Fee will not apply.

b. Fee Waiver

    The Exchange proposes to waive all fees for trading in XSP options 
beginning with the launch of trading in XSP options through January 31, 
2006.

[[Page 73043]]

Following the fee waiver period, the Exchange will begin assessing the 
fees set forth above. The Exchange has decided to waive all XSP fees to 
promote the launch of the XSP product.
2. Statutory Basis
    The Exchange believes that the proposed rule change, as amended, is 
consistent with Section 6(b) of the Act,\7\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act,\8\ in particular, in that 
it provides for the equitable allocation of reasonable dues, fees, and 
other charges among CBOE's members and other persons using its 
facilities.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change, as 
amended, will 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 neither solicited nor received comments on the 
proposed rule change.

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

    The proposed rule change, as amended, has become effective upon 
filing pursuant to Section 19(b)(3)(A) of the Act \9\ and subparagraph 
(f)(2) of Rule 19b-4 thereunder,\10\ because it establishes or changes 
a due, fee, or other charge imposed by the CBOE. 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.\11\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(2).
    \11\ The effective date of the original proposed rule change is 
October 25, 2005 and the effective date of the amendment is December 
1, 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 December 1, 2005, the date on 
which the Exchange submitted Amendment No. 1. See 15 U.S.C. 
78s(b)(3)(C).
---------------------------------------------------------------------------

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-2005-88 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-CBOE-2005-88. 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 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 offices of 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-2005-88 and should be submitted on or before December 29, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
Jonathan G. Katz,
Secretary.
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    \12\ 17 CFR 200.30-3(a)(12).
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 [FR Doc. E5-7067 Filed 12-7-05; 8:45 am]
BILLING CODE 8010-01-P

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