Self-Regulatory Organizations; CBOE Futures Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Block Trading, 46255-46257 [E7-16209]

Download as PDF Federal Register / Vol. 72, No. 159 / Friday, August 17, 2007 / Notices Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–Amex–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 (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, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of Amex. 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–Amex–2007–24 and should be submitted on or before September 7, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.7 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–16208 Filed 8–16–07; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56241; File No. SR–CFE– 2007–01] ebenthall on PRODPC61 with NOTICES Self-Regulatory Organizations; CBOE Futures Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Block Trading August 13, 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 July 31, 2007, CBOE Futures Exchange, LLC (‘‘CFE’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change described in Items I, II, and III below, which Items have been substantially prepared by CFE. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. CFE also filed the proposed rule change with the Commodity Futures Trading Commission (‘‘CFTC’’), together with a written certification under Section 5c(c) of the Commodity Exchange Act (‘‘CEA’’) 3 on July 30, 2007. I. Self-Regulatory Organization’s Description of the Proposed Rule Change The Exchange proposes to amend CFE Rule 415, which governs Block Trading, to further describe: (a) The specific conditions under which it is permissible to aggregate orders for different accounts in order to satisfy minimum Block Trade size requirements, (b) the factors to be considered in determining whether the price of a Block Trade is ‘‘fair and reasonable,’’ and (c) certain aspects relating to CFE’s review of Block Trades. Although Rule 415 and these proposed rule amendments are applicable to all of CFE’s products, CFE is submitting this proposed rule change to the Commission solely with respect to its applicability to any security futures that may be listed for trading on CFE. The text of the proposed rule change is available at CFE, the Commission’s Public Reference Room, and http://cfe.cboe.com/aboutcfe/. 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. 1 15 U.S.C. 78s(b)(7). CFR 240.19b–7. 3 7 U.S.C. 7a–2(c). 2 17 7 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 15:36 Aug 16, 2007 Jkt 211001 PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 46255 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose First, CFE is proposing to amend CFE Rule 415(a)(i) to further specify the conditions under which it is permissible to aggregate orders for different accounts in order to satisfy minimum Block Trade size requirements. For each futures contract traded on CFE, there is a separate rule chapter that governs the relevant contract and which sets forth, among other things, the minimum Block Trade quantity for that contract. Rule 415(a)(i) currently permits three classes of persons (hereinafter, ‘‘permissible persons’’) to aggregate orders for different accounts in order to meet the designated minimum Block Trade quantity.4 CFE proposes amending Rule 415(a)(i) to specify that a permissible person may only aggregate accounts that are under the management or control of that permissible person in order to satisfy the designated Block Trade size requirement. CFE also proposes to amend the rule to explicitly state that, other than as described above, orders for different accounts may not be aggregated to satisfy Block Trade size requirements. The aggregation allowance in Rule 415(a)(i) was intended as a narrow exception and was made available so that permissible persons who used the same strategy for different accounts under their same management could receive the same treatment. CFE believes that the addition of the proposed language more clearly sets forth the original intent of the aggregation allowance in Rule 415(a)(i). CFE additionally proposes to amend Rule 415(a)(i) to provide that if a Block Trade is executed as a spread or combination, each leg of the order must meet the designated minimum size set forth in the rule chapter governing the relevant futures contract. Currently, every rule chapter specifies that one leg must meet the minimum Block Trade quantity for that contract (which is currently 100 contracts for each CFE futures contract) and the other leg(s) must have a contract size that is reasonably related to the leg meeting the 4 The three permissible persons identified in CFE Rule 415 are (1) a commodity trading advisor registered under the CEA, (2) an investment adviser registered as such with the SEC that is exempt from regulation under the CEA and CFTC Regulations thereunder, or (3) any person authorized to perform functions similar or equivalent to those of a commodity trading advisor in any jurisdiction outside the United States of America, in each case with total assets under management exceeding US$25 million. E:\FR\FM\17AUN1.SGM 17AUN1 ebenthall on PRODPC61 with NOTICES 46256 Federal Register / Vol. 72, No. 159 / Friday, August 17, 2007 / Notices minimum Block Trade quantity. By amending Rule 415(a)(i) to refer to the required size of each leg of the order instead of to the total quantity of the legs (as is currently the case), the Rule will mesh better with the provisions of these rule chapters. Second, CFE is proposing to add new sub-paragraph (b) to Rule 415 to set forth the factors to be considered in determining whether the price of a Block Trade is ‘‘fair and reasonable.’’ Specifically, CFE proposes to move the four factors already codified in subparagraph (c) of Rule 415 and to add two new factors to be considered. The existing four factors are: (1) The size of the Block Trade; (2) the prices and sizes of transactions in the same contract at the relevant time; (3) the prices and sizes of transactions in other relevant markets, including without limitation the underlying cash and futures markets, at the relevant time; and (4) the circumstances of the parties to the Block Trade. CFE proposes adding two new factors, which are: (1) Prices and sizes of resting book orders on the Exchange or other relevant markets; and (2) whether the Block Trade is executed as a spread or combination. CFE also proposes amending Rule 415(b) to provide that the foregoing ‘‘guidelines apply in determining whether the execution price of a Block Trade that is not executed as a spread or combination is ‘fair and reasonable.’ These guidelines are general and may not be applicable in each instance. Whether the execution price of a Block Trade is ‘fair and reasonable’ depends upon the particular facts and circumstances. In the event the quantity present in the order book is greater or equal to the quantity needed to fill an order of the size of the Block Trade, it would generally be expected that the Block Trade price would be better than the price present in the order book. In the event the quantity present in the order book is less than the quantity needed to fill an order of the size of the Block Trade, it would generally be expected that the Block Trade price would be relatively close to the price present in the order book and that the amount of the differential between the two prices would be smaller to the extent that the differential between the quantity present in the order book and the Block Trade quantity is smaller.’’ CFE believes that these general guidelines will help market participants by providing them with additional guidance regarding when the price of a Block Trade is considered ‘‘fair and reasonable.’’ Third, CFE is proposing to add new sub-paragraphs (i) and (j) to Rule 415 to VerDate Aug<31>2005 15:36 Aug 16, 2007 Jkt 211001 codify pre-existing practices and aspects of CFE’s review of Block Trades. Proposed new sub-paragraph (i) provides that the CFE Help Desk may review a Block Trade for compliance with the requirements of Rule 415 and may determine not to permit the Block Trade to be consummated if the Help Desk determines that the Block Trade does not conform with the requirements of Rule 415. Additionally, proposed new sub-paragraph (j) provides that (i) the posting of a Block Trade by the CFE Help Desk does not constitute a determination by CFE that the Block Trade was effected in conformity with the requirements of Rule 415, and (ii) a Block Trade that is posted by the CFE Help Desk which does not conform to the requirements of Rule 415 shall be processed and given effect but will be subject to appropriate disciplinary action in accordance with the rules of CFE. Although this reflects current CFE policy and practice, CFE believes it is beneficial to explicitly reflect it in CFE’s rules. Lastly, the proposed rule change makes some clarifying wording changes to the current language of Rule 415, which are non-substantive. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with section 6(b) of the Act 5 in general and section 6(b)(5) of the Act 6 in particular in that it provides additional detail to market participants regarding CFE’s Block Trading requirements and thus is designed to prevent fraudulent and manipulative acts and practices, and 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 CFE does not believe that the proposed rule change will impose any burden on competition 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 No written comments were solicited or received with respect to the proposed rule change. 5 15 6 15 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(5). Frm 00063 Fmt 4703 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.7 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.8 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 rulecomments@sec.gov. Please include File Number SR–CFE–2007–01 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–CFE–2007–01. 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, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filing also will be 7 15 8 15 Sfmt 4703 E:\FR\FM\17AUN1.SGM U.S.C. 78s(b)(7). U.S.C. 78s(b)(1). 17AUN1 Federal Register / Vol. 72, No. 159 / Friday, August 17, 2007 / Notices available for inspection and copying at the principal office of 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–CFE–2007–01 and should be submitted on or before September 7, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.9 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–16209 Filed 8–16–07; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56239; File No. SR–CBOE– 2007–84] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of a Proposed Rule Change To Amend CBOE’s Rule Pertaining to Verification Requests for Trade Reporting Minor Rule Violations August 10, 2007. ebenthall on PRODPC61 with NOTICES 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 July 18, 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 Exchange. 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 Exchange proposes to amend CBOE Rule 17.50 (Imposition of Fines for Minor Rule Violations) Interpretation and Policy .02(b) regarding verification requests for fines imposed pursuant to the provisions of CBOE Rule 17.50(g)(4) (Failure to Submit Trade Information on Time and Failure to Submit Trade Information to the Price Reporter). 9 17 CFR 200.30–3(a)(73). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 15:36 Aug 16, 2007 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 purpose of this proposal is to increase the ‘‘look-back’’ period in connection with determining the maximum number of transactions during a given month for which a member fined under CBOE Rule 17.50(g)(4) can request verification. The Exchange proposes to increase this ‘‘look-back’’ period from a rolling 18month period to a rolling 24-month period. CBOE Rule 6.51 provides, in part, that a participant in each transaction to be designated by the Exchange must report or ensure the transaction is reported to the Exchange within 90 seconds of the execution, in a form and manner prescribed by the Exchange, so that the trade information may be reported to time and sales reports. Transactions not reported within 90 seconds after execution, in accordance with CBOE Rule 6.51(a)(i), shall be designated as late. The Exchange recently amended CBOE Rule 17.50(g)(4) and lengthened its ‘‘lookback’’ period for assessing fine amounts to a rolling 24-month period for violations of CBOE Rule 6.51 in connection with trade reporting.3 The Exchange believes that lengthening the rolling period for determining the maximum number of transactions during a given month for which a member can submit verification requests to a 24-month period will serve as an 3 See Securities Exchange Act Release No. 54827 (November 29, 2006), 71 FR 70810 (December 6, 2006) (approving SR–CBOE–2006–81). 1 15 VerDate Aug<31>2005 The text of the proposed rule change is available on the Exchange’s Web site (http://www.cboe.com), at the Exchange’s principal office, and at the Commission’s Public Reference Room. Jkt 211001 PO 00000 Frm 00064 Fmt 4703 Sfmt 4703 46257 effective deterrent to such violative conduct. 2. Statutory Basis The Exchange believes that the proposed rule changes will strengthen its ability to carry out its oversight responsibilities as a self-regulatory organization and reinforce its surveillance and enforcement functions. The Exchange believes that the proposed rule change is consistent with section 6(b) of the Act,4 in general, and furthers the objectives of section 6(b)(5) of the Act,5 in particular, in that it would promote just and equitable principles of trade, facilitate transactions in securities, remove impediments to and perfect the mechanisms of a free and open market and a national market system, and protect investors and the public interest. B. Self-Regulatory Organization’s Statement on Burden on Competition This proposed rule change 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 No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve such proposed rule change, or (B) Institute proceedings to determine whether the proposed rule change should be disapproved. 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: 4 15 5 15 E:\FR\FM\17AUN1.SGM U.S.C. 78f(b). U.S.C. 78f(b)(5). 17AUN1

Agencies

[Federal Register Volume 72, Number 159 (Friday, August 17, 2007)]
[Notices]
[Pages 46255-46257]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-16209]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56241; File No. SR-CFE-2007-01]


Self-Regulatory Organizations; CBOE Futures Exchange, LLC; Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change Relating 
to Block Trading

August 13, 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 July 31, 2007, CBOE Futures Exchange, LLC (``CFE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change described in Items 
I, II, and III below, which Items have been substantially prepared by 
CFE. The Commission is publishing this notice to solicit comments on 
the proposed rule change from interested persons. CFE also filed the 
proposed rule change with the Commodity Futures Trading Commission 
(``CFTC''), together with a written certification under Section 5c(c) 
of the Commodity Exchange Act (``CEA'') \3\ on July 30, 2007.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(7).
    \2\ 17 CFR 240.19b-7.
    \3\ 7 U.S.C. 7a-2(c).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Description of the Proposed Rule 
Change

    The Exchange proposes to amend CFE Rule 415, which governs Block 
Trading, to further describe: (a) The specific conditions under which 
it is permissible to aggregate orders for different accounts in order 
to satisfy minimum Block Trade size requirements, (b) the factors to be 
considered in determining whether the price of a Block Trade is ``fair 
and reasonable,'' and (c) certain aspects relating to CFE's review of 
Block Trades. Although Rule 415 and these proposed rule amendments are 
applicable to all of CFE's products, CFE is submitting this proposed 
rule change to the Commission solely with respect to its applicability 
to any security futures that may be listed for trading on CFE. The text 
of the proposed rule change is available at CFE, the Commission's 
Public Reference Room, and http://cfe.cboe.com/aboutcfe/.

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
    First, CFE is proposing to amend CFE Rule 415(a)(i) to further 
specify the conditions under which it is permissible to aggregate 
orders for different accounts in order to satisfy minimum Block Trade 
size requirements. For each futures contract traded on CFE, there is a 
separate rule chapter that governs the relevant contract and which sets 
forth, among other things, the minimum Block Trade quantity for that 
contract. Rule 415(a)(i) currently permits three classes of persons 
(hereinafter, ``permissible persons'') to aggregate orders for 
different accounts in order to meet the designated minimum Block Trade 
quantity.\4\ CFE proposes amending Rule 415(a)(i) to specify that a 
permissible person may only aggregate accounts that are under the 
management or control of that permissible person in order to satisfy 
the designated Block Trade size requirement. CFE also proposes to amend 
the rule to explicitly state that, other than as described above, 
orders for different accounts may not be aggregated to satisfy Block 
Trade size requirements. The aggregation allowance in Rule 415(a)(i) 
was intended as a narrow exception and was made available so that 
permissible persons who used the same strategy for different accounts 
under their same management could receive the same treatment. CFE 
believes that the addition of the proposed language more clearly sets 
forth the original intent of the aggregation allowance in Rule 
415(a)(i).
---------------------------------------------------------------------------

    \4\ The three permissible persons identified in CFE Rule 415 are 
(1) a commodity trading advisor registered under the CEA, (2) an 
investment adviser registered as such with the SEC that is exempt 
from regulation under the CEA and CFTC Regulations thereunder, or 
(3) any person authorized to perform functions similar or equivalent 
to those of a commodity trading advisor in any jurisdiction outside 
the United States of America, in each case with total assets under 
management exceeding US$25 million.
---------------------------------------------------------------------------

    CFE additionally proposes to amend Rule 415(a)(i) to provide that 
if a Block Trade is executed as a spread or combination, each leg of 
the order must meet the designated minimum size set forth in the rule 
chapter governing the relevant futures contract. Currently, every rule 
chapter specifies that one leg must meet the minimum Block Trade 
quantity for that contract (which is currently 100 contracts for each 
CFE futures contract) and the other leg(s) must have a contract size 
that is reasonably related to the leg meeting the

[[Page 46256]]

minimum Block Trade quantity. By amending Rule 415(a)(i) to refer to 
the required size of each leg of the order instead of to the total 
quantity of the legs (as is currently the case), the Rule will mesh 
better with the provisions of these rule chapters.
    Second, CFE is proposing to add new sub-paragraph (b) to Rule 415 
to set forth the factors to be considered in determining whether the 
price of a Block Trade is ``fair and reasonable.'' Specifically, CFE 
proposes to move the four factors already codified in sub-paragraph (c) 
of Rule 415 and to add two new factors to be considered. The existing 
four factors are: (1) The size of the Block Trade; (2) the prices and 
sizes of transactions in the same contract at the relevant time; (3) 
the prices and sizes of transactions in other relevant markets, 
including without limitation the underlying cash and futures markets, 
at the relevant time; and (4) the circumstances of the parties to the 
Block Trade. CFE proposes adding two new factors, which are: (1) Prices 
and sizes of resting book orders on the Exchange or other relevant 
markets; and (2) whether the Block Trade is executed as a spread or 
combination.
    CFE also proposes amending Rule 415(b) to provide that the 
foregoing ``guidelines apply in determining whether the execution price 
of a Block Trade that is not executed as a spread or combination is 
`fair and reasonable.' These guidelines are general and may not be 
applicable in each instance. Whether the execution price of a Block 
Trade is `fair and reasonable' depends upon the particular facts and 
circumstances. In the event the quantity present in the order book is 
greater or equal to the quantity needed to fill an order of the size of 
the Block Trade, it would generally be expected that the Block Trade 
price would be better than the price present in the order book. In the 
event the quantity present in the order book is less than the quantity 
needed to fill an order of the size of the Block Trade, it would 
generally be expected that the Block Trade price would be relatively 
close to the price present in the order book and that the amount of the 
differential between the two prices would be smaller to the extent that 
the differential between the quantity present in the order book and the 
Block Trade quantity is smaller.'' CFE believes that these general 
guidelines will help market participants by providing them with 
additional guidance regarding when the price of a Block Trade is 
considered ``fair and reasonable.''
    Third, CFE is proposing to add new sub-paragraphs (i) and (j) to 
Rule 415 to codify pre-existing practices and aspects of CFE's review 
of Block Trades. Proposed new sub-paragraph (i) provides that the CFE 
Help Desk may review a Block Trade for compliance with the requirements 
of Rule 415 and may determine not to permit the Block Trade to be 
consummated if the Help Desk determines that the Block Trade does not 
conform with the requirements of Rule 415. Additionally, proposed new 
sub-paragraph (j) provides that (i) the posting of a Block Trade by the 
CFE Help Desk does not constitute a determination by CFE that the Block 
Trade was effected in conformity with the requirements of Rule 415, and 
(ii) a Block Trade that is posted by the CFE Help Desk which does not 
conform to the requirements of Rule 415 shall be processed and given 
effect but will be subject to appropriate disciplinary action in 
accordance with the rules of CFE. Although this reflects current CFE 
policy and practice, CFE believes it is beneficial to explicitly 
reflect it in CFE's rules.
    Lastly, the proposed rule change makes some clarifying wording 
changes to the current language of Rule 415, which are non-substantive.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with section 6(b) of the Act \5\ in general and section 6(b)(5) of the 
Act \6\ in particular in that it provides additional detail to market 
participants regarding CFE's Block Trading requirements and thus is 
designed to prevent fraudulent and manipulative acts and practices, and 
to promote just and equitable principles of trade, and in general, to 
protect investors and the public interest.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    CFE does not believe that the proposed rule change will impose any 
burden on competition 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

    No written comments were solicited or received with respect to the 
proposed rule change.

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.\7\ 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.\8\
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(7).
    \8\ 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-CFE-2007-01 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-CFE-2007-01. 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, 100 F Street, NE., 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of such filing also will be

[[Page 46257]]

available for inspection and copying at the principal office of 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-CFE-2007-01 
and should be submitted on or before September 7, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(73).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-16209 Filed 8-16-07; 8:45 am]
BILLING CODE 8010-01-P