Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Its Marketing Fee Program, 27756-27757 [E6-7245]
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27756
Federal Register / Vol. 71, No. 92 / Friday, May 12, 2006 / Notices
SPDRs, [and] options on DIA, options on
NDX, and options on RUT. The fee will
not apply to: Market-Maker-to-Market[Release No. 34–53767; File No. SR–CBOE–
Maker transactions including
2006–43]
transactions resulting from orders from
non-member market-makers;
Self-Regulatory Organizations;
transactions resulting from P/A orders;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
transactions resulting from
Immediate Effectiveness of a Proposed accommodation liquidations (cabinet
Rule Change Relating to Its Marketing
trades); and transactions resulting from
Fee Program
dividend strategies, merger strategies,
and short stock interest strategies as
May 8, 2006.
defined in footnote 13 of this Fees
Pursuant to Section 19(b)(1) of the
Schedule. This fee shall not apply to
Securities Exchange Act of 1934
index options and options on ETFs
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
(other than options on SPDRs, [and]
notice is hereby given that on April 28,
options on DIA, options on NDX, and
2006, the Chicago Board Options
options on RUT). A Preferred MarketExchange, Incorporated (‘‘CBOE’’ or
Maker will only be given access to the
‘‘Exchange’’) filed with the Securities
marketing fee funds generated from a
and Exchange Commission
Preferred order if the Preferred Market(‘‘Commission’’) the proposed rule
Maker has an appointment in the class
change as described in Items I, II, and
in which the Preferred order is received
III below, which Items have been
and executed. If less than 80% of the
prepared by the Exchange. The CBOE
marketing fee funds are paid out by the
has designated this proposal as one
DPM/LMM or Preferred Market-Maker
establishing or changing a due, fee, or
in a given month, then the Exchange
other charge imposed by the CBOE
under Section 19(b)(3)(A)(ii) of the Act 3 would refund such surplus at the end of
and Rule 19b–4(f)(2) thereunder,4 which the month on a pro rata basis based
renders the proposal effective upon
upon contributions made by the Marketfiling with the Commission. The
Makers, RMMs, e-DPMs, DPMs and
Commission is publishing this notice to LMMs. However, if 80% or more of the
solicit comments on the proposed rule
accumulated funds in a given month are
change from interested persons.
paid out by the DPM/LMM or Preferred
Market-Maker, there will not be a rebate
I. Self-Regulatory Organization’s
for that month and the funds will carry
Statement of the Terms of Substance of
over and will be included in the pool of
the Proposed Rule Change
funds to be used by the DPM/LMM or
The CBOE proposes to amend its Fees
Preferred Market-Maker the following
Schedule and its marketing fee program.
month. At the end of each quarter, the
Below is the text of the proposed rule
Exchange would then refund any
change. Proposed new language is in
italics; deleted language is in [brackets]. surplus, if any, on a pro rata basis based
upon contributions made by the MarketChicago Board Options Exchange, Inc.
Makers, RMMs, DPMs, e-DPMs and
LMMs. CBOE’s marketing fee program
Fees Schedule
as described above will be in effect until
[March 1] May 1, 2006
June 2, 2006.
1. No Change.
Remainder of Fees Schedule—No
2. Marketing Fee (6)(16) .......... $.65 change.
3.–4. No Change.
II. Self-Regulatory Organization’s
Footnotes:
Statement of the Purpose of, and
(1)–(5) No Change.
Statutory Basis for, the Proposed Rule
(6) The Marketing Fee will be
assessed only on transactions of Market- Change
Makers, RMMs, e-DPMs, DPMs, and
In its filing with the Commission, the
LMMs resulting from orders for less
Exchange included statements
than 1,000 contracts (i) from payment
concerning the purpose of and basis for
accepting firms, or (ii) that have
the proposed rule change, and discussed
designated a ‘‘Preferred Market-Maker’’
any comments it received on the
under CBOE Rule 8.13 at the rate of $.65
proposed rule change. The text of these
per contract on all classes of equity
statements may be examined at the
options, options on HOLDRs, options on
places specified in Item IV below. The
CBOE has prepared summaries, set forth
1 15 U.S.C. 78s(b)(1).
in Sections A, B, and C below, of the
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
most significant aspects of such
4 17 CFR 240.19b–4(f)(2).
statements.
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A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The CBOE states that, currently, its
marketing fee is assessed upon DPMs,
LMMs, e-DPMs, RMMs, and MarketMakers at the rate of $.65 per contract
on transactions of Market-Makers,
RMMs, e-DPMs, DPMs, and LMMs
resulting from orders for less than 1,000
contracts (i) from payment accepting
firms, or (ii) that have designated a
‘‘Preferred Market-Maker’’ under CBOE
Rule 8.13. The Exchanges notes that this
fee does not apply to: Market-Maker-toMarket-Maker transactions (which
includes all transactions between any
combination of DPMs, e-DPMs, RMMs,
LMMs, and Market-Makers, and
transactions resulting from orders from
non-member market-makers);
transactions resulting from inbound P/A
orders; transactions resulting from
accommodation liquidation (cabinet
trades); or transactions resulting from
dividend strategies, merger strategies,
and short stock interest strategies. CBOE
states that the marketing fee is assessed
on all equity option classes and options
on HOLDRs, options on SPDRs, and
options on DIA.
CBOE now proposes to amend its
marketing fee program to assess the fee
on options on the Nasdaq-100
(NDXTM) Index and options on the
Russell 2000 (RUT) Index. The fee
would commence in NDX and RUT
options on May 1, 2006.
CBOE states that it is not amending its
marketing fee program in any other
respect.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,5 in general, and
furthers the objectives of Section 6(b)(4)
of the Act,6 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 Exchange does not believe that
the proposed rule change will impose
any inappropriate burden on
competition not necessary or
appropriate in furtherance of the
purposes of the Act.
5 15
6 15
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
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Federal Register / Vol. 71, No. 92 / Friday, May 12, 2006 / Notices
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
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 7 and Rule 19b–4(f)(2) 8 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. At any time within 60
days of the filing of such 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.
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:
sroberts on PROD1PC70 with NOTICES
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–2006–43 on the
subject line.
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 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–2006–43 and should
be submitted on or before June 2, 2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.9
Nancy M. Morris,
Secretary.
[FR Doc. E6–7245 Filed 5–11–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–53771; File No. SR–CBOE–
2006–39]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of a
Proposed Rule Change Regarding the
e-DPM Membership Ownership
Requirement
May 8, 2006.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
Paper Comments
notice is hereby given that on April 20,
• Send paper comments in triplicate
2006, the Chicago Board Options
to Nancy M. Morris, Secretary,
Exchange, Incorporated (‘‘CBOE’’ or
Securities and Exchange Commission,
‘‘Exchange’’) filed with the Securities
100 F Street, NE., Washington, DC
and Exchange Commission
20549–1090.
(‘‘Commission’’) the proposed rule
All submissions should refer to File
change as described in Items I, II, and
Number SR–CBOE–2006–43. This file
III below, which Items have been
number should be included on the
prepared by the CBOE. The Commission
subject line if e-mail is used. To help the is publishing this notice to solicit
Commission process and review your
comments on the proposed rule change
comments more efficiently, please use
from interested persons.
only one method. The Commission will
post all comments on the Commission’s I. Self-Regulatory Organization’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
submission, all subsequent
The Exchange proposes to clarify the
amendments, all written statements
application of the e-DPM membership
with respect to the proposed rule
ownership requirement. The text of the
change that are filed with the
9 17
7 15
8 17
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
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proposed rule change is set forth below.
New text is in italics.
Chicago Board Options Exchange,
Incorporated
*
*
*
*
*
Rule 8.92. Electronic DPM Program
(a)–(c) No change.
(d) Membership Requirement. Until
July 12, 2007, each e-DPM organization
is required to (i) own one Exchange
membership for every 30 products
allocated to the e-DPM; or (ii) lease one
Exchange membership for every 20
products allocated to the e-DPM. After
July 12, 2007, each e-DPM organization
is required to own one Exchange
membership for every 30 products
allocated to the e-DPM. An Exchange
membership shall include a transferable
regular membership or a Chicago Board
of Trade full membership that has
effectively been exercised pursuant to
Article Fifth(b) of the Certificate of
Incorporation. Memberships used to
satisfy this requirement may not be used
for any other purpose including being
leased to another member, to comply
with the DPM membership ownership
requirement of Rule 8.85(e), or for
trading on the trading floor. For
purposes of this Rule, the term
‘‘product’’ refers to all options of the
same single underlying security/value.
An e-DPM organization shall be deemed
to own or lease an Exchange
membership for purposes of this
paragraph (d) if its parent company
owns or leases seats that are used solely
for the e-DPM organization’s e-DPM
activities.
(e) No change.
*
*
*
*
*
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 proposed
rule change. The text of these statements
may be examined at the places specified
in Item IV below. 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 clarify the
application of CBOE Rule 8.92(d)
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[Federal Register Volume 71, Number 92 (Friday, May 12, 2006)]
[Notices]
[Pages 27756-27757]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-7245]
[[Page 27756]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-53767; File No. SR-CBOE-2006-43]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change Relating to Its Marketing Fee Program
May 8, 2006.
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 April 28, 2006, 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. 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 \3\ and Rule 19b-4(f)(2) thereunder,\4\
which renders 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The CBOE proposes to amend its Fees Schedule and its marketing fee
program. Below is the text of the proposed rule change. Proposed new
language is in italics; deleted language is in [brackets].
Chicago Board Options Exchange, Inc.
Fees Schedule
[March 1] May 1, 2006
1. No Change.
2. Marketing Fee (6)(16)....................................... $.65
3.-4. No Change.
Footnotes:
(1)-(5) No Change.
(6) The Marketing Fee will be assessed only on transactions of
Market-Makers, RMMs, e-DPMs, DPMs, and LMMs resulting from orders for
less than 1,000 contracts (i) from payment accepting firms, or (ii)
that have designated a ``Preferred Market-Maker'' under CBOE Rule 8.13
at the rate of $.65 per contract on all classes of equity options,
options on HOLDRs, options on SPDRs, [and] options on DIA, options on
NDX, and options on RUT. The fee will not apply to: Market-Maker-to-
Market-Maker transactions including transactions resulting from orders
from non-member market-makers; transactions resulting from P/A orders;
transactions resulting from accommodation liquidations (cabinet
trades); and transactions resulting from dividend strategies, merger
strategies, and short stock interest strategies as defined in footnote
13 of this Fees Schedule. This fee shall not apply to index options and
options on ETFs (other than options on SPDRs, [and] options on DIA,
options on NDX, and options on RUT). A Preferred Market-Maker will only
be given access to the marketing fee funds generated from a Preferred
order if the Preferred Market-Maker has an appointment in the class in
which the Preferred order is received and executed. If less than 80% of
the marketing fee funds are paid out by the DPM/LMM or Preferred
Market-Maker in a given month, then the Exchange would refund such
surplus at the end of the month on a pro rata basis based upon
contributions made by the Market-Makers, RMMs, e-DPMs, DPMs and LMMs.
However, if 80% or more of the accumulated funds in a given month are
paid out by the DPM/LMM or Preferred Market-Maker, there will not be a
rebate for that month and the funds will carry over and will be
included in the pool of funds to be used by the DPM/LMM or Preferred
Market-Maker the following month. At the end of each quarter, the
Exchange would then refund any surplus, if any, on a pro rata basis
based upon contributions made by the Market-Makers, RMMs, DPMs, e-DPMs
and LMMs. CBOE's marketing fee program as described above will be in
effect until June 2, 2006.
Remainder of Fees Schedule--No change.
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 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 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 CBOE states that, currently, its marketing fee is assessed upon
DPMs, LMMs, e-DPMs, RMMs, and Market-Makers at the rate of $.65 per
contract on transactions of Market-Makers, RMMs, e-DPMs, DPMs, and LMMs
resulting from orders for less than 1,000 contracts (i) from payment
accepting firms, or (ii) that have designated a ``Preferred Market-
Maker'' under CBOE Rule 8.13. The Exchanges notes that this fee does
not apply to: Market-Maker-to-Market-Maker transactions (which includes
all transactions between any combination of DPMs, e-DPMs, RMMs, LMMs,
and Market-Makers, and transactions resulting from orders from non-
member market-makers); transactions resulting from inbound P/A orders;
transactions resulting from accommodation liquidation (cabinet trades);
or transactions resulting from dividend strategies, merger strategies,
and short stock interest strategies. CBOE states that the marketing fee
is assessed on all equity option classes and options on HOLDRs[reg],
options on SPDRs[reg], and options on DIA.
CBOE now proposes to amend its marketing fee program to assess the
fee on options on the Nasdaq-100[reg] (NDXTM) Index and
options on the Russell 2000[reg] (RUT) Index. The fee would commence in
NDX and RUT options on May 1, 2006.
CBOE states that it is not amending its marketing fee program in
any other respect.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\5\ in general, and furthers the
objectives of Section 6(b)(4) of the Act,\6\ in particular, in that it
is designed to provide for the equitable allocation of reasonable dues,
fees, and other charges among CBOE members.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f(b).
\6\ 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 will
impose any inappropriate burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.
[[Page 27757]]
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
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 \7\ and Rule 19b-
4(f)(2) \8\ 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. At any time within 60 days
of the filing of such 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.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
\8\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-CBOE-2006-43 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2006-43. 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 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-2006-43 and should be submitted on or before June
2, 2006.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\9\
---------------------------------------------------------------------------
\9\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Nancy M. Morris,
Secretary.
[FR Doc. E6-7245 Filed 5-11-06; 8:45 am]
BILLING CODE 8010-01-P
