Self-Regulatory Organizations; Boston Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto to Eliminate Fees on Certain Exchange Traded Funds and to Establish Fees on Certain Options on Indexes, 78479-78481 [E6-22395]
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pwalker on PROD1PC69 with NOTICES
Federal Register / Vol. 71, No. 250 / Friday, December 29, 2006 / Notices
accordance with Commentary .01(5) of
Amex Rule 916 or trading in the shares
are halted or suspended in their primary
market. Additionally, as proposed, the
Exchange will consider the suspension
of opening transactions in any series of
options covering Exchange-Traded Fund
Shares if the value of the non-U.S.
currency on which the Exchange-Traded
Fund Shares are based is no longer
calculated or available. The Commission
believes that the proposed change to
Amex Rule 916 with respect to
withdrawal of approval is consistent
with the protection of investors and the
public interest.
The Commission notes that the
Exchange has represented that it has an
adequate surveillance program in place
for options on Exchange-Traded Fund
Shares, including those funds that are
based on the value of a non-U.S.
currency. In addition, the Exchange has
represented that it is able to obtain
currency-related trading information via
the ISG from other exchanges who are
members or affiliates of the ISG, as
discussed above, in connection with
options and futures trading on those
exchanges.
The Commission finds good cause for
approving the proposed rule change, as
amended, prior to the thirtieth day after
the date of publication of the notice of
filing thereof in the Federal Register.
The Exchange has requested accelerated
approval because this proposed rule
change is based on, and is substantially
similar to, a proposal by the ISE that the
Commission recently approved.22
Accordingly, this proposal raises no
new or novel regulatory issues that have
not been previously considered by the
Commission. In addition, the
Commission notes that it did not receive
any comments on the ISE’s proposal.
The Commission believes that
expanding Amex Rule 915 to encompass
options on Exchange-Traded Fund
Shares that represent interests in a trust
that holds non-U.S. currency deposited
with the trust will provide investors
with an additional investment choice
and that accelerated approval of the
proposal will allow investors to begin
trading these products promptly.
Additionally, the proposal contains
measures that are designed to minimize
the potential for manipulation of the
underlying currency held by the
Exchange-Traded Fund Shares.
Therefore, the Commission finds good
cause, consistent with Section 19(b)(2)
22 See Securities Exchange Act Release No. 54087
(June 30, 2006), 71 FR 38918 (July 10, 2006) (SR–
ISE–2005–60).
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18:15 Dec 28, 2006
Jkt 211001
of the Act,23 to approve the amended
proposal on an accelerated basis.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,24 that the
proposed rule change (SR-Amex-2006–
87), as modified by Amendment Nos. 1
and 2, be, and it hereby is, approved on
an accelerated basis.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.25
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6–22400 Filed 12–28–06; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–55000; File No. SR–BSE–
2006–47]
Self-Regulatory Organizations; Boston
Stock Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change and
Amendment No. 1 Thereto to Eliminate
Fees on Certain Exchange Traded
Funds and to Establish Fees on
Certain Options on Indexes
December 21, 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 November
14, 2006, the Boston Stock Exchange,
Inc. (‘‘BSE’’ 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 substantially prepared by the
BSE. On December 20, 2006, BSE filed
Amendment No. 1 to the proposed rule
change.3 The BSE has designated this
proposal as one establishing or changing
a due, fee, or other charge applicable
only to a member under Section
19(b)(3)(A)(ii) of the Act,4 and Rule
19b–4(f)(2) thereunder,5 which renders
23 15
U.S.C. 78s(b)(2).
U.S.C. 78s(b)(2).
25 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, among
other things: (1) Clarified that the proposed rule
change establishes fees applicable only to members
for transactions in options on indices effected by
members; (2) made additional amendments to
correct certain errors and omissions; and (3)
corrected certain errors in the purpose section of
the proposed rule change. Changes made in
Amendment No. 1 have been incorporated into this
notice.
4 15 U.S.C. 78s(b)(3)(A)(ii).
5 17 CFR 240.19b–4(f)(2).
24 15
PO 00000
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78479
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
BSE is proposing to amend the Fee
Schedule of the Boston Options
Exchange (‘‘BOX’’) to remove the
surcharge fee for certain Exchange
Traded Funds (‘‘ETFs’’) and to establish
fees applicable only to members for
transactions in options on indices
effected by members. The BOX Fee
Schedule is available at the Exchange,
the Commission’s Public Reference
Room, and https://
www.bostonoptions.com.
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
BSE 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 BSE 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
BSE is proposing to amend the BOX
Fee Schedule to remove the surcharge
fee for transactions in options on the
ETF Nasdaq 100 (‘‘QQQQs’’), the
Standard & Poor’s (‘‘S&P’’) Depository
Receipts (‘‘SPY’’), the iShares Nasdaq
Biotechnology Index Fund (‘‘IBB’’),
iShares Russell 2000 Index Fund
(‘‘IWM’’), iShares Russell 2000 Growth
Index Fund (‘‘IWO’’), the S&P Energy
Select Sector SPDR Fund (‘‘XLE’’) and
the S&P Financial Select Sector SPDR
Fund (‘‘XLF’’). The Exchange is
proposing to remove the surcharge from
its Fee Schedule because it no longer
pays a licensing fee on such ETFs.
The Exchange is also proposing to
establish a fifteen (15) cent surcharge fee
for transactions in options on the
Russell 2000 Index (‘‘RUT’’),6 the full
6 Russell 2000is a trademark and service mark of
the Frank Russell Company, used under license.
Neither Frank Russell Company’s Publication of the
Russell Indexes nor its licensing of its trademarks
E:\FR\FM\29DEN1.SGM
Continued
29DEN1
78480
Federal Register / Vol. 71, No. 250 / Friday, December 29, 2006 / Notices
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value Nasdaq-100 Index (‘‘NDX’’),7 and
the reduced value Nasdaq-100 Index
(Mini-NDX Index (‘‘MNX’’)) 8 effected
by members for broker-dealer
proprietary accounts.9 The Exchange
for use in connection with securities or other
financial products derived from a Russell Index in
any way suggests or implies a representation or
opinion by Frank Russell Company as to the
attractiveness of investment in any securities or
other financial products based upon or derived
from any Russell Index. Frank Russell Company is
not the issuer of any such securities or other
financial products and makes no express or implied
warranties or merchantability or fitness for any
particular purpose with respect to any Russell
Index or any data included or reflected therein, nor
as to results to be obtained by any person or any
entity from the use of the Russell Index or any data
included or reflected therein. Options on RUT are
currently listed for trading on the American Stock
Exchange (‘‘AMEX’’), BOX, the Chicago Board
Options Exchange, Inc. (‘‘CBOE’’), and the
International Securities Exchange, LLC (‘‘ISE’’). See
Securities Exchange Act Release No. 53968 (June 9,
2006), 71 FR 34971 (June 16, 2006) (approving
Amex listing); Securities Exchange Act Release No.
54397 (August 31, 2006), 71 FR 53142 (September
8, 2006) (approving BOX listing); Securities
Exchange Act Release No. 51749 (May 26, 2005), 70
FR 34510 (June 14, 2005) (approving CBOE listing);
Securities Exchange Act Release No. 51858 (June
16, 2005), 70 FR 36218 (June 22, 2005) (approving
ISE listing).
7 Nasdaq, Nasdaq-100 and Nasdaq-100 Index
are registered trademarks of The Nasdaq Stock
Market, Inc. (which with its affiliates are the
‘‘Corporations’’) and are licensed for use by the
Boston Options Exchange Group in connection with
the trading of options products based on the
Nasdaq-100 Index. The product(s) have not been
passed on by the Corporations as to their legality
or suitability. The product(s) are not issued,
endorsed, sold, or promoted by the Corporations.
The Corporations make no warranties and bear no
liability with respect to the product(s). The
Corporations do not guarantee the accuracy and/or
uninterrupted calculation of the Nasdaq-100 Index
or any data included therein. The Corporations
make no warranty, express or implied, as to results
to be obtained by licensee, owners of the product(s),
or any other person or entity from the use of the
Nasdaq-100 Index or any data included therein.
The Corporations make no express or implied
warranties, and expressly disclaim all warranties of
merchantability or fitness for a particular purpose
or use with respect to the Nasdaq-100 Index or any
data included therein. Without limiting any of the
foregoing, in no event shall the Corporations have
any liability for any lost profits or special,
incidental, punitive, indirect or consequential
damages, even if notified of the possibility of such
damages.
8 Options on NDX and MNX are currently listed
for trading on Amex, BOX, CBOE, and ISE. See
Securities Exchange Act Release No. 45163
(December 18, 2001), 66 FR 66958 (December 27,
2001) (imposing licensing fees for transactions in
options on the NDX and MNX, among other things);
Securities Exchange Act Release No. 51884 (June
20, 2005), 70 FR 36973 (June 27, 2005) (correcting
Amex’s failure to file a proposed rule change with
respect to its listing of NDX and MNX); Securities
Exchange Act Release No. 54397 (August 31, 2006),
71 FR 53142 (September 8, 2006) (approving BOX
NDX and MNX listing); Securities Exchange Act
Release No. 51351 (March 9, 2005), 70 FR 12917
(March 16, 2005) (approving CBOE NDX and MNX
listing); Securities Exchange Release No. 51397
(March 18, 2005), 70 FR 15372 (March 25, 2005)
(approving ISE NDX and MNX listing).
9 The Exchange notes that the fees that are the
subject of this proposed rule change do not apply
to public customer orders.
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18:15 Dec 28, 2006
Jkt 211001
represents that these fees will only be
charged to BOX members and shall
apply to Linkage Orders 10 under a pilot
program that is set to expire on July 31,
2007. The Exchange believes that the
proposed rule change will further the
Exchange’s goal of introducing new
products to the marketplace that are
competitively priced. BOX began
trading options on RUT, NDX, and MNX
on November 13, 2006 but did not begin
charging fees for transactions in the
above-referenced products until
November 14, 2006, the date SR–BSE–
2006–47 was filed with the
Commission.
The Exchange has entered into
licensing agreements to use various
indexes and trademarks in connection
with the listing and trading of index
options on the Russell 2000 Index,
Nasdaq-100 Index and the Mini-NDX
Index. As with certain other licensed
options, the Exchange is adopting a
surcharge fee for trading in these
options to defray the licensing costs.
The Exchange believes that charging
BOX Options Participants 11 that trade
these instruments is the most equitable
means of recovering the licensing costs.
2. Statutory Basis
The Exchanges believes that the
proposal is consistent with the
requirement of Section 6(b) of the Act,12
in general, and Section 6(b)(4) of the
Act,13 in particular, in that it provides
for the equitable allocation of reasonable
dues, fees and other charges among its
members and other persons using its
facilities.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange believes that the
proposed rule change, as amended, does
not 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 not solicited nor
received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change, as
amended, establishes or changes a due,
10 See BOX Rules Chapter XII, Section 1(defining
Linkage Orders).
11 See BOX Rules, Chapter 1, Section 1(a)(40)
(defining Options Participants).
12 15 U.S.C. 78f(b).
13 15 U.S.C. 78f(b)(4).
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Frm 00086
Fmt 4703
Sfmt 4703
fee, or other charge applicable only to a
member, it has become effective
pursuant to Section 19(b)(3)(A)(ii) of the
Act 14 and Rule 19b–4(f)(2) 15
thereunder. At any time within 60 days
of the filing of such amended 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.16
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
No. SR–BSE–2006–47 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–BSE–2006–47. 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
14 15
U.S.C. 78s(b)(3)(A)(ii).
CFR 19b–4(f)(2).
16 For purposes of calculating the 60-day period
within which the Commission may summarily
abrogate the proposed rule change under Section
19(b)(3)(C) of the Act, the Commission considers
the period to commence on December 20, 2006, the
date on which the BSE submitted Amendment No.
1. See 15 U.S.C. 78s(b)(3)(C).
15 17
E:\FR\FM\29DEN1.SGM
29DEN1
Federal Register / Vol. 71, No. 250 / Friday, December 29, 2006 / Notices
the Commission’s Public Reference
Room. Copies of such filing also will be
available for inspection and copying at
the principal office of the BSE. 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–BSE–2006–47 and should
be submitted on or before January 19,
2007.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.17
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6–22395 Filed 12–28–06; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54987; File No. SR–CBOE–
2006–107]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of
Proposed Rule Change Regarding a
Permit Program for CBSX
December 20, 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 December
18, 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
substantially prepared by the CBOE.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.
pwalker on PROD1PC69 with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to modify its
rules relating to the establishment of a
permit program for the Exchange’s
proposed stock-trading facility CBSX.
The text of the proposed rule change is
available at CBOE, the Commission’s
Public Reference Room, and https://
www.cboe.com.
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
VerDate Aug<31>2005
18:15 Dec 28, 2006
Jkt 211001
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
CBSX will be a facility of the
Exchange and will serve as the
Exchange’s vehicle for trading nonoption securities. The Exchange (via a
separate rule filing) is proposing to
modify Chapters 50–55 of the CBOE
Rules in connection with the
establishment of the CBSX. CBSX is a
separate legal entity (a Delaware
Limited Liability Company) that is
owned by the Exchange and several
strategic partners. The Exchange is also
submitting a rule filing proposing to
establish CBSX as a facility of the
Exchange. The purpose of this filing is
to modify the Exchange’s Constitution
and Rules to establish a CBSX Permit
Program that will allow non-CBOE seat
holders access to CBSX. The Exchange
believes that expanding access to CBSX
beyond CBOE’s options user base will
enhance liquidity on CBSX and make it
a more attractive stock trading venue.
The salient features of the Permit
Program are summarized below.
• The permits may only be used for
trading stock on CBSX. A Permit does
not entitle the holder to trade options on
CBOE or to physically enter an option
trading post on the trading floor.
• Up to 100 permits may be issued.
• The Permit Program could be
terminated by the Exchange via a rule
filing approved by the Commission.
This provision is incorporated in the
Constitution so that the Permit Program
could be terminated with a rule change
filing but without a corresponding
membership vote (i.e., in approving this
Constitutional change, the membership
is approving the notion that a future
termination of the Permit Program could
occur without another membership
vote).
• Permit holders would be deemed
statutory members of CBOE.
Accordingly, they would have the same
PO 00000
Frm 00087
Fmt 4703
Sfmt 4703
78481
petition and voting rights as regular
members except for matters relating to
Exchange ownership (specifically,
matters relating to demutualization,
mergers, consolidations, dissolution,
liquidation, transfer, or conversion of
assets of the Exchange), and except
matters relating the Chicago Board of
Trade exercise right.
• Permit holders would have no
interest in the assets or property of
CBOE and would have no right to share
in any distribution by the Exchange.
• Permit holders (or an executive
officer of a Permit holder) would be
eligible to run for an at-large director
position and a Nominating Committee
position.
• Permit holders would have to be
registered broker-dealers.
• Permits would not be transferable.
• All Permits would expire every
October and would be eligible for
renewal.
In connection with the Permit
application process, if there are fewer
available CBSX Permits than qualified
applicants, the Exchange will determine
which of the applicants to approve by
lot. Applicants that are affiliated shall
be deemed one applicant in cases where
there are fewer available CBSX Permits
than qualified applicants.
A CBSX Permit holder and its
associated persons shall comply with
and be subject to CBOE Rules to the
same extent that Exchange members and
their associated persons are obligated to
comply with and are subject to
Exchange Rules. Further, a CBSX Permit
holder and its associated persons shall
be subject to the disciplinary, appeals,
and arbitration jurisdiction and rules of
the Exchange and entitled to the
procedural rights under those rules to
the same extent that Exchange members
and their associated persons are subject
to such jurisdiction and rules and
entitled to such procedural rights.
The rule filing also eliminates
outdated references in the Constitution
to the New York Stock Exchange
Options Permit Program which no
longer exists.
Lastly, the Exchange notes that on
December 14, 2006, the Exchange held
a special meeting of the membership for
purposes of voting on the Permit
Program. The membership voted in
favor of adopting the Permit Program.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6(b) of the
Act,3 in general, and with Section
3 15
E:\FR\FM\29DEN1.SGM
U.S.C. 78f(b).
29DEN1
]]>Agencies
[Federal Register Volume 71, Number 250 (Friday, December 29, 2006)]
[Notices]
[Pages 78479-78481]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-22395]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-55000; File No. SR-BSE-2006-47]
Self-Regulatory Organizations; Boston Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
and Amendment No. 1 Thereto to Eliminate Fees on Certain Exchange
Traded Funds and to Establish Fees on Certain Options on Indexes
December 21, 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 November 14, 2006, the Boston Stock Exchange, Inc. (``BSE'' 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 substantially prepared by the BSE.
On December 20, 2006, BSE filed Amendment No. 1 to the proposed rule
change.\3\ The BSE has designated this proposal as one establishing or
changing a due, fee, or other charge applicable only to a member under
Section 19(b)(3)(A)(ii) 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, among other things: (1)
Clarified that the proposed rule change establishes fees applicable
only to members for transactions in options on indices effected by
members; (2) made additional amendments to correct certain errors
and omissions; and (3) corrected certain errors in the purpose
section of the proposed rule change. Changes made in Amendment No. 1
have been incorporated into this notice.
\4\ 15 U.S.C. 78s(b)(3)(A)(ii).
\5\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
BSE is proposing to amend the Fee Schedule of the Boston Options
Exchange (``BOX'') to remove the surcharge fee for certain Exchange
Traded Funds (``ETFs'') and to establish fees applicable only to
members for transactions in options on indices effected by members. The
BOX Fee Schedule is available at the Exchange, the Commission's Public
Reference Room, and https://www.bostonoptions.com.
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 BSE 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 BSE 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
BSE is proposing to amend the BOX Fee Schedule to remove the
surcharge fee for transactions in options on the ETF Nasdaq 100
(``QQQQs''), the Standard & Poor's (``S&P'') Depository Receipts
(``SPY''), the iShares Nasdaq Biotechnology Index Fund (``IBB''),
iShares Russell 2000 Index Fund (``IWM''), iShares Russell 2000 Growth
Index Fund (``IWO''), the S&P Energy Select Sector SPDR Fund (``XLE'')
and the S&P Financial Select Sector SPDR Fund (``XLF''). The Exchange
is proposing to remove the surcharge from its Fee Schedule because it
no longer pays a licensing fee on such ETFs.
The Exchange is also proposing to establish a fifteen (15) cent
surcharge fee for transactions in options on the Russell 2000[supreg]
Index (``RUT''),\6\ the full
[[Page 78480]]
value Nasdaq-100[supreg] Index (``NDX''),\7\ and the reduced value
Nasdaq-100[supreg] Index (Mini-NDX[supreg] Index (``MNX'')) \8\
effected by members for broker-dealer proprietary accounts.\9\ The
Exchange represents that these fees will only be charged to BOX members
and shall apply to Linkage Orders \10\ under a pilot program that is
set to expire on July 31, 2007. The Exchange believes that the proposed
rule change will further the Exchange's goal of introducing new
products to the marketplace that are competitively priced. BOX began
trading options on RUT, NDX, and MNX on November 13, 2006 but did not
begin charging fees for transactions in the above-referenced products
until November 14, 2006, the date SR-BSE-2006-47 was filed with the
Commission.
---------------------------------------------------------------------------
\6\ Russell 2000[supreg]is a trademark and service mark of the
Frank Russell Company, used under license. Neither Frank Russell
Company's Publication of the Russell Indexes nor its licensing of
its trademarks for use in connection with securities or other
financial products derived from a Russell Index in any way suggests
or implies a representation or opinion by Frank Russell Company as
to the attractiveness of investment in any securities or other
financial products based upon or derived from any Russell Index.
Frank Russell Company is not the issuer of any such securities or
other financial products and makes no express or implied warranties
or merchantability or fitness for any particular purpose with
respect to any Russell Index or any data included or reflected
therein, nor as to results to be obtained by any person or any
entity from the use of the Russell Index or any data included or
reflected therein. Options on RUT are currently listed for trading
on the American Stock Exchange (``AMEX''), BOX, the Chicago Board
Options Exchange, Inc. (``CBOE''), and the International Securities
Exchange, LLC (``ISE''). See Securities Exchange Act Release No.
53968 (June 9, 2006), 71 FR 34971 (June 16, 2006) (approving Amex
listing); Securities Exchange Act Release No. 54397 (August 31,
2006), 71 FR 53142 (September 8, 2006) (approving BOX listing);
Securities Exchange Act Release No. 51749 (May 26, 2005), 70 FR
34510 (June 14, 2005) (approving CBOE listing); Securities Exchange
Act Release No. 51858 (June 16, 2005), 70 FR 36218 (June 22, 2005)
(approving ISE listing).
\7\ Nasdaq[supreg], Nasdaq-100[supreg] and Nasdaq-100
Index[supreg] are registered trademarks of The Nasdaq Stock Market,
Inc. (which with its affiliates are the ``Corporations'') and are
licensed for use by the Boston Options Exchange Group in connection
with the trading of options products based on the Nasdaq-100
Index[supreg]. The product(s) have not been passed on by the
Corporations as to their legality or suitability. The product(s) are
not issued, endorsed, sold, or promoted by the Corporations. The
Corporations make no warranties and bear no liability with respect
to the product(s). The Corporations do not guarantee the accuracy
and/or uninterrupted calculation of the Nasdaq-100 Index[supreg] or
any data included therein. The Corporations make no warranty,
express or implied, as to results to be obtained by licensee, owners
of the product(s), or any other person or entity from the use of the
Nasdaq-100 Index[supreg] or any data included therein. The
Corporations make no express or implied warranties, and expressly
disclaim all warranties of merchantability or fitness for a
particular purpose or use with respect to the Nasdaq-100
Index[supreg] or any data included therein. Without limiting any of
the foregoing, in no event shall the Corporations have any liability
for any lost profits or special, incidental, punitive, indirect or
consequential damages, even if notified of the possibility of such
damages.
\8\ Options on NDX and MNX are currently listed for trading on
Amex, BOX, CBOE, and ISE. See Securities Exchange Act Release No.
45163 (December 18, 2001), 66 FR 66958 (December 27, 2001) (imposing
licensing fees for transactions in options on the NDX and MNX, among
other things); Securities Exchange Act Release No. 51884 (June 20,
2005), 70 FR 36973 (June 27, 2005) (correcting Amex's failure to
file a proposed rule change with respect to its listing of NDX and
MNX); Securities Exchange Act Release No. 54397 (August 31, 2006),
71 FR 53142 (September 8, 2006) (approving BOX NDX and MNX listing);
Securities Exchange Act Release No. 51351 (March 9, 2005), 70 FR
12917 (March 16, 2005) (approving CBOE NDX and MNX listing);
Securities Exchange Release No. 51397 (March 18, 2005), 70 FR 15372
(March 25, 2005) (approving ISE NDX and MNX listing).
\9\ The Exchange notes that the fees that are the subject of
this proposed rule change do not apply to public customer orders.
\10\ See BOX Rules Chapter XII, Section 1(defining Linkage
Orders).
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The Exchange has entered into licensing agreements to use various
indexes and trademarks in connection with the listing and trading of
index options on the Russell[supreg] 2000 Index, Nasdaq-100[supreg]
Index and the Mini-NDX[supreg] Index. As with certain other licensed
options, the Exchange is adopting a surcharge fee for trading in these
options to defray the licensing costs. The Exchange believes that
charging BOX Options Participants \11\ that trade these instruments is
the most equitable means of recovering the licensing costs.
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\11\ See BOX Rules, Chapter 1, Section 1(a)(40) (defining
Options Participants).
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2. Statutory Basis
The Exchanges believes that the proposal is consistent with the
requirement of Section 6(b) of the Act,\12\ in general, and Section
6(b)(4) of the Act,\13\ in particular, in that it provides for the
equitable allocation of reasonable dues, fees and other charges among
its members and other persons using its facilities.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes that the proposed rule change, as amended,
does not 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 not solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change, as amended, establishes or
changes a due, fee, or other charge applicable only to a member, it has
become effective pursuant to Section 19(b)(3)(A)(ii) of the Act \14\
and Rule 19b-4(f)(2) \15\ thereunder. At any time within 60 days of the
filing of such amended 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.\16\
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\14\ 15 U.S.C. 78s(b)(3)(A)(ii).
\15\ 17 CFR 19b-4(f)(2).
\16\ For purposes of calculating the 60-day period within which
the Commission may summarily abrogate the proposed rule change under
Section 19(b)(3)(C) of the Act, the Commission considers the period
to commence on December 20, 2006, the date on which the BSE
submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).
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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 No. SR-BSE-2006-47 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-BSE-2006-47. 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
[[Page 78481]]
the Commission's Public Reference Room. Copies of such filing also will
be available for inspection and copying at the principal office of the
BSE. 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-BSE-
2006-47 and should be submitted on or before January 19, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\17\
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\17\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E6-22395 Filed 12-28-06; 8:45 am]
BILLING CODE 8011-01-P
