Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 To Increase the Class Quoting Limit in the Option Class Baidu.com, Inc. (BIDU), 12641-12642 [E7-4785]

Download as PDF Federal Register / Vol. 72, No. 51 / Friday, March 16, 2007 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–55429; File No. SR–CBOE– 2007–24] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 To Increase the Class Quoting Limit in the Option Class Baidu.com, Inc. (BIDU) March 8, 2007. 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 February 27, 2007, 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 Exchange has designated this proposal as one constituting a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule under Section 19(b)(3)(A)(i) of the Act,3 and Rule 19b–4(f)(1) 4 thereunder, which renders the proposal effective upon filing with the Commission. The Exchange submitted Amendment No. 1 to the proposed rule change on March 5, 2007. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. sroberts on PROD1PC70 with NOTICES I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change CBOE proposes to increase the class quoting limit in the option class Baidu.com, Inc. (BIDU). The text of the proposed rule change is available on CBOE’s Web site (https:// www.cboe.com), at the CBOE’s Office of the Secretary, 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 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 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(i). 4 17 CFR 240.19b–4(f)(1). VerDate Aug<31>2005 15:24 Mar 15, 2007 Jkt 211001 statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose CBOE Rule 8.3A, Maximum Number of Market Participants Quoting Electronically per Product, establishes class quoting limits (‘‘CQLs’’) for each class traded on the Hybrid Trading System.5 A CQL is the maximum number of quoters that may quote electronically in a given product and the current levels are established from 25– 40, depending on the trading activity of the particular product. Rule 8.3A, Interpretation .01(c) provides a procedure by which the President of the Exchange may increase the CQL for a particular product. In this regard, the President of the Exchange may increase the CQL in exceptional circumstances, which are defined in the rule as ‘‘substantial trading volume, whether actual or expected.’’ 6 The effect of an increase in the CQL is procompetitive in that it increases the number of market participants that may quote electronically in a product. The purpose of this filing is to increase the CQL in the option class BIDU from its current limit of 35 to 40 due to increased trading volume. Increasing the CQL in BIDU options will enable the Exchange to enhance the liquidity offered, thereby offering deeper and more liquid markets. 2. Statutory Basis Accordingly, CBOE 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.7 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 8 requirements that the rules of an exchange be designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative 5 See Rule 8.3A.01. actions taken by the President of the Exchange pursuant to this paragraph will be submitted to the SEC in a rule filing pursuant to Section 19(b)(3)(A) of the Exchange Act.’’ Rule 8.3A.01(c). 7 15 U.S.C. 78(f)(b). 8 15 U.S.C. 78(f)(b)(5). 6 ‘‘Any PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 12641 acts and, in general, to protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition 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 Exchange Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither received nor solicited written comments on the proposal. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change will take effect upon filing with the Commission pursuant to Section 19(b)(3)(A)(i) of the Act 9 and Rule 19b– 4(f)(1) thereunder,10 because it constitutes a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule. At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.11 IV. Solicitation of Comments Interested persons are invited to submit written data, views, and 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–2007–24 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 9 15 U.S.C. 78s(b)(3)(A)(i). CFR 240.19b–4(f)(1). 11 The 60 day abrogation period commenced on March 5, 2007, the date on which the Exchange filed Amendment No. 1. 10 17 E:\FR\FM\16MRN1.SGM 16MRN1 12642 Federal Register / Vol. 72, No. 51 / Friday, March 16, 2007 / Notices 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–CBOE–2007–24. 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 Section, 100 F Street, NE., Washington, DC 20549. 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–2007–24 and should be submitted on or before April 6, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.12 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–4785 Filed 3–15–07; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–55438; File No. SR–CBOE– 2007–19] sroberts on PROD1PC70 with NOTICES Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Extend Two Pilot Programs That Allow RMMs and eDPMs to Have up to One Affiliated Market-Maker Physically Present in the Trading Crowd March 9, 2007. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 12 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 15:24 Mar 15, 2007 Jkt 211001 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on February 22, 2007, the Chicago Board Options Exchange, Incorporated (‘‘Exchange’’ or ‘‘CBOE’’) filed with the Securities and Exchange Commission (‘‘Commission’’ or ‘‘SEC’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. 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 the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change CBOE proposes to extend two pilot programs allowing Remote MarketMakers (‘‘RMMs’’) and Electronic DPMs (‘‘e-DPMs’’) to have up to one separate affiliated Market-Maker physically present in the trading crowd. The CBOE proposes to extend the pilots until March 14, 2008. The text of the proposed rule change is available on CBOE’s Web site (https://www.cboe.org/ Legal), at the CBOE’s Office of the Secretary, and at the Commission. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend CBOE Rules 8.4(c)(i) and 8.93(vii) to extend the pilot programs allowing an RMM and e-DPM the option to have up to one separate affiliated Market-Maker physically present in the trading crowds 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(iii). 4 17 CFR 240.19b–4(f)(6). 2 17 PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 where it operates as an RMM or e-DPM, respectively (such Market-Makers would be required to trade on a separate membership).5 The pilots would be extended from March 14, 2007 until March 14, 2008. In July of 2003, the SEC approved the e-DPM program, including the pilot program.6 The pilot allows e-DPM firms to maintain a physical presence in the trading crowd through an affiliated Market-Maker who would also be able to stream a quote. The pilot, however, limits the number of separate affiliates per trading crowd to one. In March of 2005, the SEC approved the RMM program, including the pilot program.7 The pilot allows RMM firms to maintain a physical presence in the trading crowd through an affiliated Market-Maker who would also be able to stream a quote. The pilot limits the number of separate affiliates per trading crowd to one. CBOE has provided the Commission, under separate cover, data relating to these Pilot Programs, which the SEC staff is reviewing.8 The Exchange has committed to providing by September 14, 2007, data required by the Pilots. 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) of the Act,10 which requires 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 CBOE does not believe that the proposed rule change will impose any 5 The SEC previously extended the pilot programs for 6 months, from September 14, 2006 until March 14, 2006. See Securities Exchange Act Release No. 54443 (September 14, 2006), 71 FR 55237 (September 21, 2006) (granting immediate effectiveness to SR–CBOE–2006–77). 6 See Securities Exchange Act Release No. 50003 (July 12, 2004), 69 FR 43028 (July 19, 2004) (approving SR–CBOE–2004–24). 7 See Securities Exchange Act Release No. 51366 (March 14, 2005), 70 FR 13217 (March, 18, 2005) (approving SR–CBOE–2004–75). 8 The Exchange has committed to providing by September 14, 2007, updated data required by the Pilots. Telephone conversation between Patrick Sexton, Associate General Counsel, CBOE and Sonia Trocchio, Special Counsel, Division of Market Regulation, Commission (March 7, 2007). 9 15 U.S.C. 78f(b). 10 15 U.S.C. 78f(b)(5). E:\FR\FM\16MRN1.SGM 16MRN1

Agencies

[Federal Register Volume 72, Number 51 (Friday, March 16, 2007)]
[Notices]
[Pages 12641-12642]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-4785]



[[Page 12641]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55429; File No. SR-CBOE-2007-24]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change and Amendment No. 1 To Increase the Class Quoting Limit in 
the Option Class Baidu.com, Inc. (BIDU)

March 8, 2007.
    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 February 27, 2007, 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 Exchange has designated this 
proposal as one constituting a stated policy, practice, or 
interpretation with respect to the meaning, administration, or 
enforcement of an existing rule under Section 19(b)(3)(A)(i) of the 
Act,\3\ and Rule 19b-4(f)(1) \4\ thereunder, which renders the proposal 
effective upon filing with the Commission. The Exchange submitted 
Amendment No. 1 to the proposed rule change on March 5, 2007. 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\ 15 U.S.C. 78s(b)(3)(A)(i).
    \4\ 17 CFR 240.19b-4(f)(1).
---------------------------------------------------------------------------

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

    CBOE proposes to increase the class quoting limit in the option 
class Baidu.com, Inc. (BIDU). The text of the proposed rule change is 
available on CBOE's Web site (https://www.cboe.com), at the CBOE's 
Office of the Secretary, 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 Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    CBOE Rule 8.3A, Maximum Number of Market Participants Quoting 
Electronically per Product, establishes class quoting limits (``CQLs'') 
for each class traded on the Hybrid Trading System.\5\ A CQL is the 
maximum number of quoters that may quote electronically in a given 
product and the current levels are established from 25-40, depending on 
the trading activity of the particular product.
---------------------------------------------------------------------------

    \5\ See Rule 8.3A.01.
---------------------------------------------------------------------------

    Rule 8.3A, Interpretation .01(c) provides a procedure by which the 
President of the Exchange may increase the CQL for a particular 
product. In this regard, the President of the Exchange may increase the 
CQL in exceptional circumstances, which are defined in the rule as 
``substantial trading volume, whether actual or expected.'' \6\ The 
effect of an increase in the CQL is procompetitive in that it increases 
the number of market participants that may quote electronically in a 
product. The purpose of this filing is to increase the CQL in the 
option class BIDU from its current limit of 35 to 40 due to increased 
trading volume. Increasing the CQL in BIDU options will enable the 
Exchange to enhance the liquidity offered, thereby offering deeper and 
more liquid markets.
---------------------------------------------------------------------------

    \6\ ``Any actions taken by the President of the Exchange 
pursuant to this paragraph will be submitted to the SEC in a rule 
filing pursuant to Section 19(b)(3)(A) of the Exchange Act.'' Rule 
8.3A.01(c).
---------------------------------------------------------------------------

2. Statutory Basis
    Accordingly, CBOE 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.\7\ Specifically, the Exchange believes the 
proposed rule change is consistent with the Section 6(b)(5) \8\ 
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.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78(f)(b).
    \8\ 15 U.S.C. 78(f)(b)(5).
---------------------------------------------------------------------------

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

    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 Exchange Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange neither received nor solicited written comments on the 
proposal.

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

    The foregoing proposed rule change will take effect upon filing 
with the Commission pursuant to Section 19(b)(3)(A)(i) of the Act \9\ 
and Rule 19b-4(f)(1) thereunder,\10\ because it constitutes a stated 
policy, practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule.
    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act.\11\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A)(i).
    \10\ 17 CFR 240.19b-4(f)(1).
    \11\ The 60 day abrogation period commenced on March 5, 2007, 
the date on which the Exchange filed Amendment No. 1.
---------------------------------------------------------------------------

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-2007-24 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission,

[[Page 12642]]

100 F Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2007-24. 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 Section, 100 F Street, 
NE., Washington, DC 20549. 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-2007-24 and 
should be submitted on or before April 6, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
---------------------------------------------------------------------------

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

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-4785 Filed 3-15-07; 8:45 am]
BILLING CODE 8010-01-P
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