Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Duration of CBOE Rule 6.45A(b) Pertaining to Orders Represented in Open Outcry, 42143-42145 [E6-11794]
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sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 71, No. 142 / Tuesday, July 25, 2006 / Notices
under Delaware’s General Corporation
Law, which provides that ‘‘the business
and affairs of every corporation shall be
managed by or under the direction of a
board of directors, except as may be
otherwise * * * provided in its
certificate of incorporation * * * * ’’ 13
CBOE stated that its Certificate provides
that the Board is CBOE’s governing body
and is vested with all powers necessary
for the management of the Exchange’s
business and affairs, except to the extent
that the authority, powers, and duties of
such management are delegated to a
committee or committees established
pursuant to CBOE’s Constitution or
Rules. According to CBOE, its
Certificate and Constitution provide that
the Board may establish one or more
committees, each of which has the
authority, powers, and duties as may be
prescribed in the Constitution,
Exchange Rules, or by resolution of the
Board.14 CBOE advised that, under these
provisions, it has established various
committees and has delegated to those
committees specific authority, powers,
and duties.
CBOE further noted that its Rules
provide that each committee ‘‘is subject
to the control and supervision of the
Board.’’ 15 CBOE stated, however, that
such supervisory power alone does not
make explicit the power of the Board to
directly modify or overrule the action
(or inaction) of a committee when the
decision-making authority with respect
to the action has been delegated to the
committee. CBOE pointed out that the
specific delegations contained in its
Constitution, Rules, and resolutions
vary in scope: Some involve a complete
delegation and others involve a limited
delegation where the Board has
explicitly or implicitly reserved certain
authorities. CBOE noted that, although
the specific delegations contained in its
Constitution, Rules, and Board
resolutions vary in describing the scope
of the authority delegated, its Board
retains the power to revoke, limit, or
change a committee delegation, either
by rule change or by resolution as
appropriate.
The purpose of the proposed rule
change, CBOE asserted, is to apply an
explicit, uniform standard of review by
the Board to the general organizational
and administrative structure of CBOE’s
committees and to resolve any
ambiguity that may exist. Thus, CBOE
contended that the proposed rule
change would clarify that the Board
retains the power and authority to
review, affirm, modify, suspend or
13 See
CBOE Response Letter, supra note 5, at 1.
14 Id.
15 CBOE
Rule 2.1(d).
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18:02 Jul 24, 2006
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overrule any and all actions or inactions
of CBOE committees and officers,
representatives, or designees, except as
otherwise specified. In CBOE’s view, the
proposal is consistent with its
Certificate and Constitution.
CBOE also advised that the proposed
rule change is consistent with the
provisions of its Constitution pertaining
to the Executive Committee. CBOE
stated that the Executive Committee is
a committee of the Board that performs
the functions of the Board when the
Board is not in session or it is not
practicable to arrange a meeting of the
Board within the time reasonably
available. Thus, to the extent that the
Executive Committee would take any
action pursuant to Article VII, Section
7.2 of its Constitution, CBOE asserted
that the Board retains jurisdiction over
those matters and may later determine
to review, affirm, modify, suspend or
overrule any and all actions of the
Executive Committee.
In the Commission’s view, the
Exchange has provided a sufficient basis
on which the Commission can find that,
as a federal matter under the Act, the
Exchange is complying with its own
Certificate and Constitution. Further, in
approving this proposal, the
Commission is relying on CBOE’s
representation that the proposed rule
change is appropriate under Delaware
state law.16 Thus, the Commission
believes that the proposed rule change
clarifies the Board’s review authority by
providing an explicit, uniform standard
to be applied to any delegation of Board
authority, powers, and duties and is
consistent with the Act.
IV. Conclusion
For the foregoing reasons, the
Commission finds that the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to a national
securities exchange, and in particular,
with Section 6(b)(1) of the Act.17
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,18 that the
proposed rule change (File No. SR–
CBOE–2006–45) is hereby approved.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.19
Nancy M. Morris,
Secretary.
[FR Doc. E6–11793 Filed 7–24–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54164; File No. SR–CBOE–
2006–60]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Extend the Duration of
CBOE Rule 6.45A(b) Pertaining to
Orders Represented in Open Outcry
July 17, 2006.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on July12,
2006, the Chicago Board Options
Exchange, Inc. (‘‘CBOE’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the CBOE. The
Exchange filed the proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of
the Act 3 and Rule 19b–4(f)(6)
thereunder,4 which renders it effective
upon filing with the Commission.5 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 CBOE proposes to extend the
duration of CBOE Rule 6.45A(b) (the
‘‘Rule’’), which relates to the allocation
of orders represented in open outcry in
equity option classes designated by the
Exchange to be traded on the CBOE
Hybrid Trading System (‘‘Hybrid’’)
through October 31, 2006. No other
substantive changes are being made to
the Rule. The text of the proposed rule
change is available on the CBOE’s
Internet Web site (https://
www.cboe.com), at the CBOE’s principal
19 17
conference among Jennifer M.
Lamie, Managing Senior Attorney, Legal Division,
CBOE; Leah Mesfin, Special Counsel, Division,
Commission; and Jan Woo, Attorney, Division,
Commission, on July 18, 2006.
17 15 U.S.C. 78f(b)(1).
18 15 U.S.C. 78s(b)(2).
PO 00000
16 Telephone
Frm 00069
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42143
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
5 The Exchange has asked the Commission to
waive the 30-day operative delay required by Rule
19b–4(f)(6)(iii), 17 CFR 240.19b–4(f)(6)(iii). See
discussion infra Section III.
1 15
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42144
Federal Register / Vol. 71, No. 142 / Tuesday, July 25, 2006 / Notices
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, 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 those
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 parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
sroberts on PROD1PC70 with NOTICES
1. Purpose
In March 2005, the Commission
approved revisions to CBOE Rule 6.45A
related to the introduction of Remote
Market-Makers.6 Among other things,
the Rule, pertaining to the allocation of
orders represented in open outcry in
equity options classes traded on Hybrid,
was amended to clarify that only incrowd market participants would be
eligible to participate in open outcry
trade allocations. In addition, the Rule
was amended to limit the duration of
the Rule until September 14, 2005. The
duration of the Rule was thereafter
extended through July 14, 2006.7 As the
duration period expired on July 14,
2006, the Exchange proposes to extend
the effectiveness of the Rule through
October 31, 2006.8
6 See Securities Exchange Act Release No. 51366
(March 14, 2005), 70 FR 13217 (March 18, 2005)
(SR–CBOE–2004–75).
7 See Securities Exchange Act Release Nos. 52423
(September 14, 2005), 70 FR 55194 (September 20,
2005) (extending the duration of the Rule through
December 14, 2005) and 52957 (December 15,
2005), 70 FR 76085 (December 22, 2005) (extending
the Rule through March 14, 2006), and 53524
(March 21, 2006), 71 FR 15235 (March 27, 2006)
(extending the duration of the Rule through July 14,
2006).
8 In order to effect proprietary transactions on the
floor of the Exchange, in addition to complying
with the requirements of the Rule, members are also
required to comply with the requirements of
Section 11(a)(1) of the Act, 15 U.S.C. 78k(a)(1), or
qualify for an exemption. Section 11(a)(1) restricts
securities transactions of a member of any national
securities exchange effected on that exchange for (i)
the member’s own account, (ii) the account of a
person associated with the member, or (iii) an
account over which the member or a person
associated with the member exercises discretion,
unless a specific exemption is available. The
Exchange issued a regulatory circular to members
informing them of the applicability of these Section
11(a)(1) requirements when the duration of the Rule
was extended until December 14, 2005, March14,
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18:02 Jul 24, 2006
Jkt 208001
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations under the
Act applicable to a national securities
exchange and, in particular, the
requirements of Section 6(b) of the Act.9
Specifically, the Exchange believes the
proposed rule change is consistent with
the Section 6(b)(5) 10 requirements that
the rules of an exchange be designed to
promote just and equitable principles of
trade, to prevent fraudulent and
manipulative acts, and, in general, to
protect investors and the public interest.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The CBOE does not believe that the
proposed rule change 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 neither solicited nor
received comments on the proposal.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not (1) significantly affect
the protection of investors or the public
interest; (2) impose any significant
burden on competition; and (3) become
operative for thirty days from the date
on which it was filed, or such shorter
time as the Commission may designate
if consistent with the protection of
investors and the public interest, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 11 and Rule 19b–
4(f)(6) 12 thereunder.13
A proposed rule change filed under
Commission Rule 19b–4(f)(6) 14
normally does not become operative
prior to thirty days after the date of
2006 and again on July 14, 2006. See CBOE
Regulatory Circulars RG05–103 (November 2, 2005),
RG06–001 (January 3, 2006) and RG06–34 (April 7,
2006). The Exchange represents that it expects to
issue a similar regulatory circular to members
reminding them of the applicability of the Section
11(a)(1) requirements with respect to the proposed
rule change.
9 15 U.S.C. 78f(b).
10 15 U.S.C. 78f(b)(5).
11 15 U.S.C. 78s(b)(3)(A).
12 17 CFR 240.19b–4(f)(6).
13 Pursuant to Rule 19b–4(f)(6)(iii), the Exchange
has given the Commission written notice of its
intent to file the proposed rule change, along with
a brief description and text of the proposed rule
change, at least five business days prior to the date
on which the Exchange filed the proposed rule
change. See 17 CFR 240.19b–4(f)(6)(iii).
14 17 CFR 240.19b–4(f)(6).
PO 00000
Frm 00070
Fmt 4703
Sfmt 4703
filing. The CBOE requests that the
Commission waive the 30-day operative
delay, as specified in Rule 19b–
4(f)(6)(iii), and designate the proposed
rule change to become operative
immediately to allow the Exchange to
continue to operate under the existing
allocation parameters for orders
represented in open outcry in Hybrid on
an uninterrupted basis. The
Commission hereby grants the request.
The Commission believes that waiving
the 30-day operative delay is consistent
with the protection of investors and the
public interest because such waiver will
allow the CBOE to continue to operate
under the Rule without interruption.
For these reasons, the Commission
designates the proposed rule change as
effective and operative upon filing.15
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 the 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:
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
No. SR–CBOE–2006–60 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–CBOE–2006–60. 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
15 For the purposes only of waiving the operative
date of this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
E:\FR\FM\25JYN1.SGM
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Federal Register / Vol. 71, No. 142 / Tuesday, July 25, 2006 / Notices
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–2006–60 and should
be submitted on or before August 15,
2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.16
Nancy M. Morris,
Secretary.
[FR Doc. E6–11794 Filed 7–24–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54167; File No. SR–
NASDAQ–2006–002]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Order Granting Accelerated
Approval of a Proposed Rule Change
and Amendment No. 1 Thereto To Add
Generic Listing Standards for IndexLinked Securities
sroberts on PROD1PC70 with NOTICES
July 18, 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 March 29,
2006, The NASDAQ Stock Market, LLC
(‘‘Nasdaq’’), 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 Nasdaq. On May 5, 2006, the
Exchange filed Amendment No. 1 to the
proposed rule change.3 The Commission
is publishing this notice to solicit
comments on the proposed rule change,
as amended, from interested persons
and to approve the proposal on an
accelerated basis.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Nasdaq proposes to reflect in the
Nasdaq rules the generic listing
standards for index-linked notes
(‘‘ILNs’’) previously approved for NASD
pursuant to Rule 19b–4(e) under the
Act.4 These ‘‘generic’’ listing standards
were recently approved by the
Commission for The Nasdaq Stock
Market, Inc. (‘‘Nasdaq Market’’) as part
of the NASD, Inc. rule book,5 but
because their approval came several
days after the approval of Nasdaq’s
registration as a national securities
exchange,6 they were not a part of the
Nasdaq rule set included in the
Exchange Approval Order.
The text of the proposed rule change
is available on Nasdaq’s Web site
(https://www.nasdaq.com), at Nasdaq’s
principal office, and at the
Commission’s Public Reference Room.
The text of the proposed rule change is
also set forth below. Proposed new
language is italicized; proposed
deletions are in [brackets].
*
*
*
*
*
4420. Quantitative Designation Criteria
In order to be listed on the Nasdaq
National Market, an issuer shall be
required to substantially meet the
criteria set forth in paragraphs (a), (b),
(c), (d), (e), (f), (g), (h), (i), (j), (k), (l), [or]
(m) or (n) below.
(a)–(l) No change.
(m) Index-Linked Securities
Index-linked securities are securities
that provide for the payment at maturity
of a cash amount based on the
performance of an underlying index or
indexes. Such securities may or may not
provide for the repayment of the original
principal investment amount. Nasdaq
may submit a rule filing pursuant to
Section 19(b)(2) of the Securities
Exchange Act of 1934 to permit the
listing and trading of index-linked
securities that do not otherwise meet the
standards set forth below in paragraphs
(1) through (9). Nasdaq will consider for
listing and trading pursuant to Rule
19b–4(e) under the Securities Exchange
Act of 1934 index-linked securities,
provided:
4 17
16 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 Nasdaq made minor
revisions to the proposed rule text.
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18:02 Jul 24, 2006
Jkt 208001
CFR 240.19b–4(e).
Securities Exchange Act Release No. 53142
(Jan. 19, 2006), 71 FR 4180 (Jan. 25, 2006).
6 See Securities Act Release No. 53128 (Jan. 13,
2006), 71 FR 3550 (Jan. 23, 2006 ‘‘Exchange
Approval Order’’).
5 See
PO 00000
Frm 00071
Fmt 4703
Sfmt 4703
42145
(1) Both the issue and the issuer of
such security meet the criteria for other
securities set forth in paragraph (f) of
this rule, except that the minimum
public distribution of the security shall
be 1,000,000 units with a minimum of
400 public holders, unless the security
is traded in $1,000 denominations, in
which case there is no minimum
number of holders.
(2) The issue has a term of not less
than one (1) year and not greater than
ten (10) years.
(3) The issue must be the nonconvertible debt of the issuer.
(4) The payment at maturity may or
may not provide for a multiple of the
positive performance of an underlying
index or indexes; however, in no event
will payment at maturity be based on a
multiple of the negative performance of
an underlying index or indexes.
(5) The issuer will be expected to have
a minimum tangible net worth in excess
of $250,000,000 and to exceed by at
least 20% the earnings requirements set
forth in paragraph (a)(1) of this Rule. In
the alternative, the issuer will be
expected: (i) to have a minimum
tangible net worth of $150,000,000 and
to exceed by at least 20% the earnings
requirement set forth in paragraph (a)(1)
of this Rule, and (ii) not to have issued
securities where the original issue price
of all the issuer’s other index-linked
note offerings (combined with indexlinked note offerings of the issuer’s
affiliates) listed on a national securities
exchange or traded through the facilities
of Nasdaq exceeds 25% of the issuer’s
net worth.
(6) The issuer is in compliance with
Rule 10A–3 under the Securities
Exchange Act of 1934.
(7) Initial Listing Criteria-Each
underlying index is required to have at
least ten (10) component securities. In
addition, the index or indexes to which
the security is linked shall either (A)
have been reviewed and approved for
the trading of options or other
derivatives by the Commission under
Section 19(b)(2) of the 1934 Act and
rules thereunder and the conditions set
forth in the Commission’s approval
order, including comprehensive
surveillance sharing agreements for
non-U.S. stocks, continue to be satisfied,
or (B) the index or indexes meet the
following criteria:
(i) Each component security has a
minimum market value of at least $75
million, except that for each of the
lowest weighted component securities in
the index that in the aggregate account
for no more than 10% of the weight of
the index, the market value can be at
least $50 million;
E:\FR\FM\25JYN1.SGM
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]]>Agencies
[Federal Register Volume 71, Number 142 (Tuesday, July 25, 2006)]
[Notices]
[Pages 42143-42145]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-11794]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54164; File No. SR-CBOE-2006-60]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Extend the Duration of CBOE Rule 6.45A(b) Pertaining to
Orders Represented in Open Outcry
July 17, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on July12, 2006, the Chicago Board Options Exchange, Inc.
(``CBOE'' or ``Exchange'') filed with the Securities and Exchange
Commission (the ``Commission'') the proposed rule change as described
in Items I and II below, which Items have been prepared by the CBOE.
The Exchange filed the proposal as a ``non-controversial'' proposed
rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and
Rule 19b-4(f)(6) thereunder,\4\ which renders it effective upon filing
with the Commission.\5\ 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)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
\5\ The Exchange has asked the Commission to waive the 30-day
operative delay required by Rule 19b-4(f)(6)(iii), 17 CFR 240.19b-
4(f)(6)(iii). See discussion infra Section III.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The CBOE proposes to extend the duration of CBOE Rule 6.45A(b) (the
``Rule''), which relates to the allocation of orders represented in
open outcry in equity option classes designated by the Exchange to be
traded on the CBOE Hybrid Trading System (``Hybrid'') through October
31, 2006. No other substantive changes are being made to the Rule. The
text of the proposed rule change is available on the CBOE's Internet
Web site (https://www.cboe.com), at the CBOE's principal
[[Page 42144]]
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, 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 those 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 parts of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
In March 2005, the Commission approved revisions to CBOE Rule 6.45A
related to the introduction of Remote Market-Makers.\6\ Among other
things, the Rule, pertaining to the allocation of orders represented in
open outcry in equity options classes traded on Hybrid, was amended to
clarify that only in-crowd market participants would be eligible to
participate in open outcry trade allocations. In addition, the Rule was
amended to limit the duration of the Rule until September 14, 2005. The
duration of the Rule was thereafter extended through July 14, 2006.\7\
As the duration period expired on July 14, 2006, the Exchange proposes
to extend the effectiveness of the Rule through October 31, 2006.\8\
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release No. 51366 (March 14,
2005), 70 FR 13217 (March 18, 2005) (SR-CBOE-2004-75).
\7\ See Securities Exchange Act Release Nos. 52423 (September
14, 2005), 70 FR 55194 (September 20, 2005) (extending the duration
of the Rule through December 14, 2005) and 52957 (December 15,
2005), 70 FR 76085 (December 22, 2005) (extending the Rule through
March 14, 2006), and 53524 (March 21, 2006), 71 FR 15235 (March 27,
2006) (extending the duration of the Rule through July 14, 2006).
\8\ In order to effect proprietary transactions on the floor of
the Exchange, in addition to complying with the requirements of the
Rule, members are also required to comply with the requirements of
Section 11(a)(1) of the Act, 15 U.S.C. 78k(a)(1), or qualify for an
exemption. Section 11(a)(1) restricts securities transactions of a
member of any national securities exchange effected on that exchange
for (i) the member's own account, (ii) the account of a person
associated with the member, or (iii) an account over which the
member or a person associated with the member exercises discretion,
unless a specific exemption is available. The Exchange issued a
regulatory circular to members informing them of the applicability
of these Section 11(a)(1) requirements when the duration of the Rule
was extended until December 14, 2005, March14, 2006 and again on
July 14, 2006. See CBOE Regulatory Circulars RG05-103 (November 2,
2005), RG06-001 (January 3, 2006) and RG06-34 (April 7, 2006). The
Exchange represents that it expects to issue a similar regulatory
circular to members reminding them of the applicability of the
Section 11(a)(1) requirements with respect to the proposed rule
change.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations under the Act applicable to a
national securities exchange and, in particular, the requirements of
Section 6(b) of the Act.\9\ Specifically, the Exchange believes the
proposed rule change is consistent with the Section 6(b)(5) \10\
requirements that the rules of an exchange be designed to promote just
and equitable principles of trade, to prevent fraudulent and
manipulative acts, and, in general, to protect investors and the public
interest.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The CBOE does not believe that the proposed rule change 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 neither solicited nor received comments on the
proposal.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not (1)
significantly affect the protection of investors or the public
interest; (2) impose any significant burden on competition; and (3)
become operative for thirty days from the date on which it was filed,
or such shorter time as the Commission may designate if consistent with
the protection of investors and the public interest, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-
4(f)(6) \12\ thereunder.\13\
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\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 17 CFR 240.19b-4(f)(6).
\13\ Pursuant to Rule 19b-4(f)(6)(iii), the Exchange has given
the Commission written notice of its intent to file the proposed
rule change, along with a brief description and text of the proposed
rule change, at least five business days prior to the date on which
the Exchange filed the proposed rule change. See 17 CFR 240.19b-
4(f)(6)(iii).
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A proposed rule change filed under Commission Rule 19b-4(f)(6) \14\
normally does not become operative prior to thirty days after the date
of filing. The CBOE requests that the Commission waive the 30-day
operative delay, as specified in Rule 19b-4(f)(6)(iii), and designate
the proposed rule change to become operative immediately to allow the
Exchange to continue to operate under the existing allocation
parameters for orders represented in open outcry in Hybrid on an
uninterrupted basis. The Commission hereby grants the request. The
Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because such waiver will allow the CBOE to continue to operate under
the Rule without interruption. For these reasons, the Commission
designates the proposed rule change as effective and operative upon
filing.\15\
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\14\ 17 CFR 240.19b-4(f)(6).
\15\ For the purposes only of waiving the operative date of this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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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 the 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:
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 No. SR-CBOE-2006-60 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2006-60. 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
[[Page 42145]]
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-2006-60 and should be
submitted on or before August 15, 2006.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-11794 Filed 7-24-06; 8:45 am]
BILLING CODE 8010-01-P
