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 Extension of the Prospective Fee Reduction and DPM Linkage Fee Credit Programs, 957-958 [E6-22]

Download as PDF Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices proposed rule change is available on CBOE’s Web site, https://www.cboe.com, at CBOE’s principal office, and at the Commission’s Public Reference Room. should be submitted on or before January 27, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.12 Jonathan G. Katz, Secretary. [FR Doc. E6–19 Filed 1–5–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53044; File No. SR–CBOE– 2005–114] 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 Extension of the Prospective Fee Reduction and DPM Linkage Fee Credit Programs December 30, 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 December 16, 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 Exchange. On December 22, 2005, CBOE filed Amendment No. 1 to the proposed rule change.3 CBOE has designated this proposal as one establishing or changing a due, fee, or other charge imposed by a selfregulatory organization pursuant to 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 cprice-sewell on PROD1PC66 with NOTICES CBOE proposes to amend its Fees Schedule to extend through January 31, 2006 the Prospective Fee Reduction Program and the DPM Linkage Fees Credit Program. The text of the 12 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 In Amendment No. 1, CBOE deleted all references to an extension of the Fixed Annual Fee Program. 4 15 U.S.C. 78s(b)(3)(A). 5 17 CFR 240.19b–4(f)(2). 1 15 VerDate Aug<31>2005 15:23 Jan 05, 2006 Jkt 208001 II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CBOE included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposal. The text of these statements may be examined at the places specified in Item IV below. The Exchange 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to extend two Exchange-fee related programs through the end of January 2006: The Prospective Fee Reduction Program and the DPM Linkage Fees Credit Program.6 Each program is currently due to expire at the end of 2005. The Exchange has determined to extend each of these programs for an additional month because the Exchange’s 2006 budget is expected to be approved in January 2006. Prospective Fee Reduction Program. The Exchange proposes to continue the Prospective Fee Reduction Program (‘‘PFRP’’) through January 31, 2006. No other changes to the PFRP are proposed. The current PFRP took effect on August 1, 2004.7 The PFRP is intended to reduce Market-Maker and DPM transaction fees in periods of high volume. The Exchange will determine as part of its annual budget review process whether the PFRP should be continued, modified or eliminated in the future. Any proposed changes to the PFRP would be filed with the Commission. DPM Linkage Fees Credit Program. The Exchange proposes to continue the DPM Linkage Fees Credit Program (‘‘Linkage Fees Credit’’) through January 31, 2006. No other changes to the Linkage Fees Credit are proposed. The Linkage Fees Credit took effect on 6 See Sections 19 and 21 of the CBOE Fees Schedule, respectively. 7 See Securities Exchange Act Release No. 50175 (August 10, 2004), 69 FR 51129 (August 17, 2004) (SR–CBOE–2004–38). See also Securities Exchange Act Release No. 52111 (July 22, 2005), 70 FR 43729 (July 28, 2005) (SR–CBOE–2005–52) (extension of PFRP through the end of 2005). PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 957 February 2, 2004 and was amended twice.8 The Linkage Fees Credit is a program that credits DPMs for transaction fees they incur related to the execution of outbound P/A orders, as defined in the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage, to assist DPMs in offsetting the additional costs they incur in routing orders to other exchanges in order to obtain the National Best Bid or Offer. The Exchange will determine as part of its annual budget review process whether the Linkage Fees Credit should be continued, modified or eliminated in the future. Any proposed changes to the Linkage Fees Credit would be filed with the Commission. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 9 in general, and furthers the objectives of Section 6(b)(4) of the Act 10 in particular, in that it is designed to provide for the equitable allocation of reasonable dues, fees, and other charges among its members. B. Self-Regulatory Organization’s Statement on Burden on Competition CBOE believes that the proposed rule change would impose no 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 CBOE did not solicit or receive any written comments with respect to the proposal. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change has been designated as a fee change pursuant to Section 19(b)(3)(A)(ii) of the Act 11 and Rule 19b–4(f)(2) 12 thereunder. Accordingly, the proposal is effective upon filing with the Commission. At any time within 60 days of the filing of the 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 8 See Securities Exchange Act Release Nos. 49341 (March 1, 2004), 69 FR 10492 (March 5, 2004) (SR– CBOE–2004–08); 49769 (May 25, 2004), 69 FR 31145 (June 2, 2004) (SR–CBOE–2004–13); and 52660 (October 24, 2005), 70 FR 62355 (October 31, 2005) (SR–CBOE–2005–80). 9 15 U.S.C. 78f(b). 10 15 U.S.C. 78f(b)(4). 11 15 U.S.C. 78s(b)(3)(A)(ii). 12 17 CFR 240.19b–4(f)(2). E:\FR\FM\06JAN1.SGM 06JAN1 958 Federal Register / Vol. 71, No. 4 / Friday, January 6, 2006 / Notices interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.13 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 rulecomments@sec.gov. Please include File Number SR–CBOE–2005–114 on the subject line. cprice-sewell on PROD1PC66 with NOTICES 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–2005–114. 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 office of the Exchange. 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 13 The effective date of the original proposed rule change is December 16, 2005, and the effective date of Amendment No. 1 is December 22, 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 22, 2005, the date on which CBOE submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). VerDate Aug<31>2005 15:23 Jan 05, 2006 Jkt 208001 submissions should refer to File Number SR–CBOE–2005–114 and should be submitted on or before January 27, 2006. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change For the Commission, by the Division of Market Regulation, pursuant to delegated authority.14 Jonathan G. Katz, Secretary. [FR Doc. E6–22 Filed 1–5–06; 8:45 am] In its filing with the Commission, the Exchange 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 Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53045; File No. SR–PCX– 2005–132] Self-Regulatory Organizations; Pacific Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Obligations of Lead Market Makers December 30, 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 December 30, 2005, the Pacific Exchange, Inc. (‘‘Exchange’’ or ‘‘PCX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been substantially prepared by the Exchange. The Exchange filed the proposed rule change as a ‘‘non-controversial’’ rule change under Rule 19b–4(f)(6) under the Act,3 which rendered the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to delete PCX Rule 6.82(c)(15) in its entirety. The Exchange also proposes to amend Commentary .02 to PCX Rule 6.82. The text of the proposed rule change is available on PCX’s Web site, https:// www.pacificex.com, at PCX’s Office of the Secretary, and at the Commission’s Public Reference Section. 14 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 17 CFR 240.19b–4(f)(6). 1 15 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to delete PCX Rule 6.82(c)(15), a sub–paragraph of Obligations of Lead Market Makers. Along with the deletion of PCX Rule 6.82(c)(15), the PCX proposes to amend Commentary .02 to PCX Rule 6.82, which addresses PCX Rule 6.82(c)(15). This rule, dealing with the handling of public customer orders that are not automatically executed on the PCX because there is a better-displayed bid or offer on another exchange, is scheduled to be operative on January 1, 2006. Under PCX Rule 6.82(c)(15), when a public customer order is not automatically executed on the PCX due to a better bid or ask price being displayed on another exchange, a Lead Market Maker (‘‘LMM’’) is obligated, as soon as practical, to address the order by either executing the public customer order at a price that matches the best available price displayed at any other exchange or by routing the public customer order via intermarket linkage (‘‘Linkage’’) for execution at any other exchange displaying the best price in the market at the time. Outbound Linkage orders on the PCX are still handled via manual interaction with the Linkage system. Manual interaction with the Linkage system can be a time consuming process that potentially could result in the delay of a public customer order being executed at a better price available at a competing exchange. By deleting PCX Rule 6.82(c)(15), in the event that an LMM does not execute the order at the better price displayed on another exchange, the LMM would not be required to send the order to the competing exchange via Linkage. Public customer orders that are not executed on the PCX could still be E:\FR\FM\06JAN1.SGM 06JAN1

Agencies

[Federal Register Volume 71, Number 4 (Friday, January 6, 2006)]
[Notices]
[Pages 957-958]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-22]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53044; File No. SR-CBOE-2005-114]


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 Extension of the 
Prospective Fee Reduction and DPM Linkage Fee Credit Programs

December 30, 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 December 16, 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 
Exchange. On December 22, 2005, CBOE filed Amendment No. 1 to the 
proposed rule change.\3\ CBOE has designated this proposal as one 
establishing or changing a due, fee, or other charge imposed by a self-
regulatory organization pursuant to 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, CBOE deleted all references to an 
extension of the Fixed Annual Fee Program.
    \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

    CBOE proposes to amend its Fees Schedule to extend through January 
31, 2006 the Prospective Fee Reduction Program and the DPM Linkage Fees 
Credit Program. The text of the proposed rule change is available on 
CBOE's Web site, https://www.cboe.com, at CBOE's principal office, 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, CBOE included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposal. The text of these 
statements may be examined at the places specified in Item IV below. 
The Exchange 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to extend two Exchange-fee related programs 
through the end of January 2006: The Prospective Fee Reduction Program 
and the DPM Linkage Fees Credit Program.\6\ Each program is currently 
due to expire at the end of 2005. The Exchange has determined to extend 
each of these programs for an additional month because the Exchange's 
2006 budget is expected to be approved in January 2006.
---------------------------------------------------------------------------

    \6\ See Sections 19 and 21 of the CBOE Fees Schedule, 
respectively.
---------------------------------------------------------------------------

    Prospective Fee Reduction Program. The Exchange proposes to 
continue the Prospective Fee Reduction Program (``PFRP'') through 
January 31, 2006. No other changes to the PFRP are proposed. The 
current PFRP took effect on August 1, 2004.\7\ The PFRP is intended to 
reduce Market-Maker and DPM transaction fees in periods of high volume. 
The Exchange will determine as part of its annual budget review process 
whether the PFRP should be continued, modified or eliminated in the 
future. Any proposed changes to the PFRP would be filed with the 
Commission.
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release No. 50175 (August 10, 
2004), 69 FR 51129 (August 17, 2004) (SR-CBOE-2004-38). See also 
Securities Exchange Act Release No. 52111 (July 22, 2005), 70 FR 
43729 (July 28, 2005) (SR-CBOE-2005-52) (extension of PFRP through 
the end of 2005).
---------------------------------------------------------------------------

    DPM Linkage Fees Credit Program. The Exchange proposes to continue 
the DPM Linkage Fees Credit Program (``Linkage Fees Credit'') through 
January 31, 2006. No other changes to the Linkage Fees Credit are 
proposed. The Linkage Fees Credit took effect on February 2, 2004 and 
was amended twice.\8\ The Linkage Fees Credit is a program that credits 
DPMs for transaction fees they incur related to the execution of 
outbound P/A orders, as defined in the Plan for the Purpose of Creating 
and Operating an Intermarket Option Linkage, to assist DPMs in 
offsetting the additional costs they incur in routing orders to other 
exchanges in order to obtain the National Best Bid or Offer. The 
Exchange will determine as part of its annual budget review process 
whether the Linkage Fees Credit should be continued, modified or 
eliminated in the future. Any proposed changes to the Linkage Fees 
Credit would be filed with the Commission.
---------------------------------------------------------------------------

    \8\ See Securities Exchange Act Release Nos. 49341 (March 1, 
2004), 69 FR 10492 (March 5, 2004) (SR-CBOE-2004-08); 49769 (May 25, 
2004), 69 FR 31145 (June 2, 2004) (SR-CBOE-2004-13); and 52660 
(October 24, 2005), 70 FR 62355 (October 31, 2005) (SR-CBOE-2005-
80).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \9\ in general, and furthers the 
objectives of Section 6(b)(4) of the Act \10\ in particular, in that it 
is designed to provide for the equitable allocation of reasonable dues, 
fees, and other charges among its members.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

    CBOE believes that the proposed rule change would impose no 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

    CBOE did not solicit or receive any written comments with respect 
to the proposal.

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

    The foregoing proposed rule change has been designated as a fee 
change pursuant to Section 19(b)(3)(A)(ii) of the Act \11\ and Rule 
19b-4(f)(2) \12\ thereunder. Accordingly, the proposal is effective 
upon filing with the Commission. At any time within 60 days of the 
filing of the 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

[[Page 958]]

interest, for the protection of investors, or otherwise in furtherance 
of the purposes of the Act.\13\
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \12\ 17 CFR 240.19b-4(f)(2).
    \13\ The effective date of the original proposed rule change is 
December 16, 2005, and the effective date of Amendment No. 1 is 
December 22, 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 22, 2005, 
the date on which CBOE 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-2005-114 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-2005-114. 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 office of the Exchange. 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-2005-114 and should be submitted on or before 
January 27, 2006.
---------------------------------------------------------------------------

    \14\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\14\
Jonathan G. Katz,
Secretary.
[FR Doc. E6-22 Filed 1-5-06; 8:45 am]
BILLING CODE 8010-01-P