Self-Regulatory Organizations; OneChicago, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Block Trades, 13337-13338 [E7-5114]

Download as PDF jlentini on PROD1PC65 with NOTICES Federal Register / Vol. 72, No. 54 / Wednesday, March 21, 2007 / Notices The Commission further believes that the proposal is consistent with Section 11A(a)(1)(C)(iii) of the Act,28 which sets forth Congress’ finding that it is in the public interest and appropriate for the protection of investors and the maintenance of fair and orderly markets to assure the availability to brokers, dealers, and investors of information with respect to quotations for and transactions in securities. Finally, the Commission notes that, if the Shares should be delisted by the Amex, the original listing exchange, the Exchange would no longer have authority to trade the Shares pursuant to this order. In support of this proposal, the Exchange has made the following representations: 1. The Exchange has appropriate rules to facilitate transactions in this type of security in the core and evening trading sessions. 2. The Exchange’s surveillance procedures are adequate to properly monitor the trading of the Shares on the Exchange. In particular, the Exchange has in place an Information Sharing Agreement with ICE, LME, and NYMEX, for the purpose of providing information in connection with trading in or related to futures contracts traded on their respective exchanges comprising the Indexes. Further, the Exchange is a member of the ISG. In addition, to facilitate surveillance, the Exchange represents that trading in the Shares will be subject to Commentary .02(e)(1)– (4) to NYSE Arca Equities Rule 8.200. 3. The Exchange will inform its ETP Holders in an Information Bulletin of the special characteristics and risks associated with trading the Shares. 4. The Exchange will require its ETP Holders to deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction and will note this prospectus delivery requirement in the Information Bulletin. 5. The Exchange will cease trading the Shares of a Fund if: (a) The listing market stops trading the Shares because of a regulatory halt similar to a halt based on NYSE Arca Equities Rule 7.12 or a halt because the IFV or the value of the applicable Underlying Index is no longer available at least every 15 seconds; or (b) the listing market delists the Shares. 6. The Exchange will halt trading as provided in NYSE Arca Equities Rule 7.34. This approval order is conditioned on the Exchange’s adherence to these representations. 28 15 U.S.C. 78k–1(a)(1)(C)(iii). VerDate Aug<31>2005 17:08 Mar 20, 2007 Jkt 211001 The Commission finds good cause for approving this proposal before the thirtieth day after the publication of notice thereof in the Federal Register. As noted previously, the Commission previously found that the listing and trading of the Shares on the Amex is consistent with the Act.29 The Commission presently is not aware of any regulatory issue that should cause it to revisit that earlier finding or preclude the trading of the Shares on the Exchange pursuant to UTP. Therefore, accelerating approval of this proposal should benefit investors by creating, without undue delay, additional competition in the market for the Shares. V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,30 that the proposed rule change (SR–NYSEArca– 2006–62), 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.31 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–5085 Filed 3–20–07; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–55475; File No. SR–OC– 2007–02] Self-Regulatory Organizations; OneChicago, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Block Trades March 15, 2007. Pursuant to Section 19(b)(7) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–7 under the Act,2 notice is hereby given that on February 5, 2007, OneChicago, LLC (‘‘OneChicago’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change described in Items I, II, and III below, which Items have been substantially prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. OneChicago has also filed the proposed rule change 29 See Amex Order, supra note 4. U.S.C. 78s(b)(2). 31 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(7). 2 17 CFR 240.19b–7. 30 15 PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 13337 with the Commodity Futures Trading Commission (‘‘CFTC’’). OneChicago filed a written certification with the CFTC under Section 5c(c) of the Commodity Exchange Act 3 on February 2, 2007. I. Self-Regulatory Organization’s Description of the Proposed Rule Change OneChicago is proposing to amend its policy regarding block trades, the text of which is available at the Exchange and 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 OneChicago is proposing to amend its Policies: Block Trades, Pre-Execution Discussions and Cross Trades (‘‘Block Trade Policy’’) relating to the block trade minimum contracts size. In addition to the current minimum contract size of 100 contracts for block trades, the proposed rule change would permit a minimum block trade contract size that is the equivalent to 10,000 shares of the underlying security for futures on single security (or combined securities if a relevant corporate event has occurred). Based on its experience, the Exchange believes the proposed rule change would permit an appropriate minimum contract size for block trades. The proposed rule change would set a minimum contract size for block trades that is equivalent to the customary size of large transactions in relevant markets, i.e., the securities market. The proposed rule change would also permit a block trade size based on combined securities if a relevant corporate event has occurred. Combined securities would be relevant with certain corporate events, such as spin offs or three for two splits. 37 U.S.C. 7a–2(c). E:\FR\FM\21MRN1.SGM 21MRN1 13338 Federal Register / Vol. 72, No. 54 / Wednesday, March 21, 2007 / Notices For example, the Exchange has a March 2007 ABCD futures contract, which has a trading unit of 100 shares of ABCD. ABCD announces a spin-off in which an entity PQRS has been created and the spin-off ratio is one share of PQRS for every 10 shares of ABCD. The spin-off will occur (‘‘the Ex date’’) before the expiration of the March 2007 ABCD futures contract. After the Ex date, the trading unit or deliverable shares for the March 2007 ABCD futures contracts would be 100 shares of ABCD and 10 shares of PQRS. The minimum block trade size for the March 2007 ABCD futures contract after the Ex date would be 91. Another example would be when a corporate event results in a three for two split of shares. In that case, the trading unit or deliverable shares would be 150 (provided the trading unit for the futures contract was 100 shares), making the minimum block trade size 67 contracts. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 4 in general and Section 6(b)(5) of the Act 5 in particular in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition OneChicago 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 Comments on the proposed rule change have not been solicited and none have been received. jlentini on PROD1PC65 with NOTICES III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change has become effective pursuant to Section 19(b)(7) of the Act.6 Within 60 days of the date of effectiveness of the proposed rule change, the Commission, after consultation with the CFTC, may summarily abrogate the proposed rule change and require that the proposed rule change be refiled in accordance U.S.C. 78f(b). U.S.C. 78f(b)(5). 6 15 U.S.C. 78s(b)(7). with the provisions of Section 19(b)(1) of the Act.7 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: • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–OC–2007–02 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–OC–2007–02. 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 (http://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission’s Public Reference Room. Copies of such filing also will be available for inspection and copying at the principal office of OneChicago. 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–OC–2007–02 and should be submitted on or before April 11, 2007. VerDate Aug<31>2005 17:08 Mar 20, 2007 7 15 8 17 Jkt 211001 PO 00000 U.S.C. 78s(b)(1). CFR 200.30–3(a)(73). Frm 00103 Fmt 4703 BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–55473; File No. SR–Phlx– 2007–12] Electronic Comments 4 15 5 15 For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–5114 Filed 3–20–07; 8:45 am] Sfmt 4703 Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Relating to Fees for Full Value Russell Index and Reduced Value Russell Index March 14, 2007. 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 February 16, 2007, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ 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 Exchange. On March 8, 2007, the Phlx submitted Amendment No. 1 to the proposed rule change. The Phlx has designated this proposal as one changing a due, fee, or other charge under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Phlx, pursuant to Section 19(b)(1) of the Act 5 and Rule 19b–4 thereunder,6 proposes to assess equity option charges, as opposed to index option charges on: (1) Options on the Russell 2000 Index 7 traded under the symbol 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(ii). 4 17 CFR 240.19b–4(f)(2). 5 15 U.S.C. 78s(b)(1). 6 17 CFR 240.19b–4. 7 Russell 2000 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 2 17 E:\FR\FM\21MRN1.SGM 21MRN1

Agencies

[Federal Register Volume 72, Number 54 (Wednesday, March 21, 2007)]
[Notices]
[Pages 13337-13338]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-5114]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55475; File No. SR-OC-2007-02]


Self-Regulatory Organizations; OneChicago, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change Relating to Block 
Trades

March 15, 2007.
    Pursuant to Section 19(b)(7) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-7 under the Act,\2\ notice is hereby given 
that on February 5, 2007, OneChicago, LLC (``OneChicago'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change described in Items I, II, and 
III below, which Items have been substantially prepared by the 
Exchange. The Commission is publishing this notice to solicit comments 
on the proposed rule change from interested persons. OneChicago has 
also filed the proposed rule change with the Commodity Futures Trading 
Commission (``CFTC'').
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    \1\ 15 U.S.C. 78s(b)(7).
    \2\ 17 CFR 240.19b-7.
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    OneChicago filed a written certification with the CFTC under 
Section 5c(c) of the Commodity Exchange Act \3\ on February 2, 2007.
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    \3\ 7 U.S.C. 7a-2(c).
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I. Self-Regulatory Organization's Description of the Proposed Rule 
Change

    OneChicago is proposing to amend its policy regarding block trades, 
the text of which is available at the Exchange and 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
    OneChicago is proposing to amend its Policies: Block Trades, Pre-
Execution Discussions and Cross Trades (``Block Trade Policy'') 
relating to the block trade minimum contracts size. In addition to the 
current minimum contract size of 100 contracts for block trades, the 
proposed rule change would permit a minimum block trade contract size 
that is the equivalent to 10,000 shares of the underlying security for 
futures on single security (or combined securities if a relevant 
corporate event has occurred).
    Based on its experience, the Exchange believes the proposed rule 
change would permit an appropriate minimum contract size for block 
trades. The proposed rule change would set a minimum contract size for 
block trades that is equivalent to the customary size of large 
transactions in relevant markets, i.e., the securities market. The 
proposed rule change would also permit a block trade size based on 
combined securities if a relevant corporate event has occurred. 
Combined securities would be relevant with certain corporate events, 
such as spin offs or three for two splits.

[[Page 13338]]

For example, the Exchange has a March 2007 ABCD futures contract, which 
has a trading unit of 100 shares of ABCD. ABCD announces a spin-off in 
which an entity PQRS has been created and the spin-off ratio is one 
share of PQRS for every 10 shares of ABCD. The spin-off will occur 
(``the Ex date'') before the expiration of the March 2007 ABCD futures 
contract. After the Ex date, the trading unit or deliverable shares for 
the March 2007 ABCD futures contracts would be 100 shares of ABCD and 
10 shares of PQRS. The minimum block trade size for the March 2007 ABCD 
futures contract after the Ex date would be 91. Another example would 
be when a corporate event results in a three for two split of shares. 
In that case, the trading unit or deliverable shares would be 150 
(provided the trading unit for the futures contract was 100 shares), 
making the minimum block trade size 67 contracts.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \4\ in general and Section 6(b)(5) of the 
Act \5\ in particular in that it is designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, and, in general, to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    OneChicago 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

    Comments on the proposed rule change have not been solicited and 
none have been received.

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

    The foregoing proposed rule change has become effective pursuant to 
Section 19(b)(7) of the Act.\6\ Within 60 days of the date of 
effectiveness of the proposed rule change, the Commission, after 
consultation with the CFTC, may summarily abrogate the proposed rule 
change and require that the proposed rule change be refiled in 
accordance with the provisions of Section 19(b)(1) of the Act.\7\
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    \6\ 15 U.S.C. 78s(b)(7).
    \7\ 15 U.S.C. 78s(b)(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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-OC-2007-02 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-OC-2007-02. 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 (http://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of such 
filing also will be available for inspection and copying at the 
principal office of OneChicago. 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-OC-2007-02 and should be submitted on or before April 
11, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(73).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-5114 Filed 3-20-07; 8:45 am]
BILLING CODE 8010-01-P