Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing of Proposed Rule Change Relating to an Extension of the Options Penny Quoting Pilot Program, 49750-49752 [E7-17082]
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Federal Register / Vol. 72, No. 167 / Wednesday, August 29, 2007 / Notices
as if that rule applied to closed-end
investment companies. The Funds also
will disclose EWCs in accordance with
the requirements of Form N–1A
concerning CDSLs. Applicants further
state that the Funds will apply the EWC
(and any waivers or scheduled
variations of the EWC) uniformly to all
shareholders in a given class and
consistently with the requirements of
rule 22d–1 under the Act.
1. Section 17(d) of the Act and rule
17d–1 under the Act prohibit an
affiliated person of a registered
investment company or an affiliated
person of such person, acting as
principal, from participating in or
effecting any transaction in connection
with any joint enterprise or joint
arrangement in which the investment
company participates unless the
Commission issues an order permitting
the transaction. In reviewing
applications submitted under section
17(d) and rule 17d–1, the Commission
considers whether the participation of
the investment company in a joint
enterprise or joint arrangement is
consistent with the provisions, policies
and purposes of the Act, and the extent
to which the participation is on a basis
different from or less advantageous than
that of other participants.
2. Rule 17d–3 under the Act provides
an exemption from section 17(d) and
rule 17d–1 to permit open-end
investment companies to enter into
distribution arrangements pursuant to
rule 12b–1 under the Act. Applicants
request an order under section 17(d) and
rule 17d–1 under the Act to permit the
Funds to impose asset-based
distribution fees. Applicants have
agreed to comply with rules 12b–1 and
17d–3 as if those rules applied to
closed-end investment companies.
jlentini on PROD1PC65 with NOTICES
Applicants’ Condition
Applicants agree that any order
granting the requested relief will be
subject to the following condition:
Each Fund relying on the order will
comply with the provisions of rules 6c–
10, 11a–3, 12b–1, 17d–3, 18f–3 and
22d–1 under the Act, as amended from
time to time, as if those rules applied to
closed-end management investment
companies, and will comply with the
NASD Sales Charge Rule, as amended
from time to time.
16:04 Aug 28, 2007
Jkt 211001
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–56307; File No. SR–Amex–
2007–96]
Asset-Based Distribution Fees
VerDate Aug<31>2005
For the Commission, by the Division of
Investment Management, under delegated
authority.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–17076 Filed 8–28–07; 8:45 am]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing of Proposed Rule Change
Relating to an Extension of the
Options Penny Quoting Pilot Program
August 22, 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 August
21, 2007, the American Stock Exchange
LLC (‘‘Amex’’ 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
Amex.3 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 (i) Expand
the current pilot program for the quoting
of a limited number of options classes
in pennies (the ‘‘Penny Quoting Pilot
Program’’ or ‘‘Pilot Program’’) and (ii)
extend the Pilot Program through March
27, 2009. The text of the proposed rule
change is available at https://
www.amex.com, at the Exchange, 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
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 The Commission notes that the proposed rule
change submitted by the Exchange contained nonsubstantive errors, which, for the purpose of this
notice, have been corrected. The Exchange has
committed to address these errors formally in an
amendment to the proposed rule change following
publication of this notice. Telephone conversation
between Jeffrey Burns, Vice President and Associate
General Counsel and Jennifer Colihan, Special
Counsel, Division of Market Regulation,
Commission on August 22, 2007.
2 17
PO 00000
Frm 00058
Fmt 4703
Sfmt 4703
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 Amex is proposing to expand the
current Penny Pilot Quoting Pilot
Program 4 which commenced on January
26, 2007. The Exchange believes that
expanding the current Pilot Program, as
proposed in this rule filing, will allow
further analysis and review of the
impact of penny quoting based on a
greater number of actively-traded
options classes.
The current Penny Quoting Pilot
Program includes thirteen (13) options
classes. The Pilot Program was recently
extended by the Exchange through
September 27, 2007.5 The Exchange
intends to roll-out the proposed
expansion of the Pilot Program in two
(2) phases.
First, commencing on September 28,
2007, the Exchange will include the
twenty-two (22) most actively-traded,
multiply-listed options classes
(excluding Google (GOOG), Nasdaq–100
Index (NDX) and the Russell 2000 Index
(RUT)) in the Penny Quoting Pilot
Program. The Exchange also proposes to
set forth in a Regulatory Circular the list
of the options classes subject to the
proposed expansion of the Pilot
Program. In addition to the thirteen (13)
options classes that are currently part of
the Pilot Program, this would expand
the Penny Quoting Pilot Program to
include approximately 35% of total
industry options volume.
Second, the Exchange on March 28,
2008 would further commence an
expansion of the Pilot Program to last
for one (1) year through March 27, 2009.
Amex anticipates that an additional
twenty-eight (28) option classes will be
added to the Penny Quoting Pilot
Program at that time such that the Pilot
would include the Top 50 multiplylisted options classes by national
volume. As a result, the Pilot Program
would then consist of sixty-three (63)
options classes. The Exchange will
4 See Securities Exchange Act Release No. 55162
(January 24, 2007), 72 FR 4738 (February 1, 2007).
5 See Securities Exchange Act Release No. 56159
(July 27, 2007), 72 FR 43300 (August 3, 2007).
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Federal Register / Vol. 72, No. 167 / Wednesday, August 29, 2007 / Notices
submit a proposed rule change pursuant
to section 19(b)(3)(A) of the Securities
Exchange Act of 1934 identifying the
options classes to be included in the
second phase of the Pilot Program
expansion.
The Exchange believes that the
proposed expansion is a measured
increase to the existing Pilot Program
given system capacity constraints and
concerns that exist industry-wide. As
set forth in the Exchange’s original rule
filing in connection with the Pilot
Program, the Amex believes that a
considerate and measured expansion is
required because quoting options in
pennies is expected to increase quote
message traffic. The Exchange believes
that the proposed expansion of options
classes that may quote in pennies under
the Pilot Program is reasonable given
the system capacity constraints and
quote mitigation strategies in place at
the Amex as well as the other options
exchanges.
The Exchange represents that it will
submit reports analyzing the Pilot
Program for the following time periods:
(i) May 1, 2007 through September 27,
2007; (ii) September 28, 2007 through
January 31, 2008; (iii) February 1, 2008
through July 31, 2008; and (iv) August
1, 2008 through January 31, 2009. The
Pilot Reports will be submitted to the
Commission within thirty (30) days of
the end of such time periods. The
Exchange expects the Pilot Reports,
among other things, to assess the impact
of the Pilot Program during the relevant
time period comparing quotation and
trading activity as follows: (1) Quotation
spread, quotation size, average daily
volume and other relevant factors: (2)
the number of quotations in the Penny
Quoting Pilot Program and the effect on
Amex system’s capacity; and (3) an
assessment of trade-throughs and how
they were addressed.
The quoting requirements in
connection with the Penny Quoting
Pilot Program will continue to provide
for (i) A minimum price variation
(‘‘MPV’’) of $0.01 for options with
premiums of up to $3 or (ii) a MPV of
$0.05 for options with premiums of $3
or greater, except for QQQQ options
which trade at an MPV of $0.01 for all
premiums.
As part of the Penny Quoting Pilot
Program, the Exchange implemented
quote mitigation strategies due to
concerns regarding system capacity. The
Exchange believes that the quote
mitigation strategies in place since the
introduction of the Pilot Program
continue to be effective. Therefore, in
this filing, the Exchange is also
proposing to further extend the
VerDate Aug<31>2005
16:04 Aug 28, 2007
Jkt 211001
effectiveness of the quote mitigation
strategies through March 27, 2009.
Finally, the Exchange believes that an
additional extension of the Penny
Quoting Pilot Program through March
27, 2009 is warranted and appropriate
for the purpose of implementing the
proposed expansion.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
section 6(b) of the Act,6 in general, and
furthers the objectives of section 6(b)(5)
of the Act,7 in particular, in that the
proposed rule change is designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to remove
impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general, to protect investors and the
public interest.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
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
Written comments on the proposed
rule change were neither solicited nor
received.
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 Exchange 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. The
Commission also requests and
6 15
7 15
PO 00000
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
Frm 00059
Fmt 4703
Sfmt 4703
49751
encourages interested persons to submit
comments on the following specific
questions:
• Whether there are circumstances
under which options classes included in
the Penny Pilot should be removed from
the Pilot?
• If so, what factors should be
considered in making the determination
to remove an option class from the
Penny Pilot?
Æ Should an objective standard be
used? For instance, should an option
class come out of the Penny Pilot if its
trading volume drops below a threshold
amount? If so, what should that
threshold be? Or, should an option class
come out of the Penny Pilot if it is no
longer among the most actively-traded
options? If so, what should be
considered the most-actively traded
options? What statistics or analysis
should be used to support a
determination to remove an options
class?
Æ Should a more subjective analysis be
allowed? If so, what factors should be
taken into account?
• What concerns might arise by
removing an option from the Penny
Pilot? How could such concerns be
ameliorated?
• How frequently should the analysis
be undertaken (e.g., annually, biannually, quarterly), or should the
evaluation be an automated process?
• If a determination is made that an
option should be removed from the
Penny Pilot, how much notice should be
given to market participants that the
quoting increment will change?
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
Number SR–Amex–2007–96 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–Amex–2007–96. 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
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Federal Register / Vol. 72, No. 167 / Wednesday, August 29, 2007 / Notices
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for inspection and copying in
the Commission’s Public Reference
Room, 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 the Exchange. 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–2007–96 and should
be submitted on or before September 19,
2007.
For the Commission, by the Division
of Market Regulation, pursuant to
delegated authority.8
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–17082 Filed 8–28–07; 8:45 am]
BILLING CODE 8010–01–P
[Release No. 34–56302; File No. SR–CBOE–
2007–88]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of
Proposed Rule Change To Amend its
Rule Regarding the Hybrid Opening
System Opening Rotations
jlentini on PROD1PC65 with NOTICES
August 22, 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 July 25,
2007, the Chicago Board Options
Exchange, Incorporated (‘‘Exchange’’ or
‘‘CBOE’’) 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 prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
8 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
16:04 Aug 28, 2007
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is proposing to amend
its rule related to opening rotations
conducted via the Hybrid Opening
System (‘‘HOSS’’). The text of the
proposed rule change is available on the
Exchange’s Web site (https://
www.cboe.com), at the Office of the
Secretary, CBOE 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
self-regulatory organization included
statements concerning the purpose of
and basis for the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
SECURITIES AND EXCHANGE
COMMISSION
VerDate Aug<31>2005
proposed rule change from interested
persons.
Jkt 211001
The Exchange is proposing to amend
its HOSS procedures contained in CBOE
Rule 6.2B. HOSS is the Exchange’s
automated system for initiating trading
at the beginning of each trading day.
The HOSS procedures currently provide
that an opening rotation for an options
class shall be initiated by HOSS at a
randomly selected time within a
number of seconds after the primary
market 3 for the underlying security
opens (or after 8:30 a.m. (Central Time)
for index options).4
The Exchange is proposing to amend
Rule 6.2B to permit the opening rotation
for an options class to be initiated by
HOSS after the opening of the
underlying security on either the
primary listing market, the primary
3 For purposes of CBOE Rule 6.2B, the Exchange
has interpreted the ‘‘primary market’’ to be the
primary listing market.
4 For purposes of CBOE Rule 6.2B, when the
underlying market ‘‘opens’’ is determined, on a
class-by-class basis, to be either the opening trade
and/or opening quote (or whichever occurs first).
Once the underlying market open occurs, HOSS
initiates the overlying option class opening and
sends a Rotation Notice to market participants.
Thereafter, HOSS will open the series of a class in
a random order.
PO 00000
Frm 00060
Fmt 4703
Sfmt 4703
volume market 5 or the first market to
open the underlying security.
Determinations on the particular
configuration for the market for the
underlying security would be made on
a class-by-class by the appropriate
Exchange Procedure Committee and
announced to the membership via
Regulatory Circular. The Exchange
believes that the proposed rule change
will provide it with more flexibility to
determine when to permit the HOSS
opening rotation process to begin,
which should contribute to the
Exchange’s ability to conduct openings
in a fairly and orderly manner.
2. Statutory Basis
By allowing for more flexibility in the
manner in which HOSS is programmed
to initiate an opening rotation, the
Exchange is enhancing its ability to
conduct fair and orderly openings, and,
as such, the Exchange believes this
proposed rule change is consistent with
section 6(b) of the Act,6 in general, and
furthers the objectives of section 6(b)(5)
of the Act,7 in particular, in that it is
designed to promote just and equitable
principles of trade, to prevent
fraudulent and manipulative acts, to
remove impediments to and to perfect
the mechanism for a free and open
market and a national market system,
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 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
5 For purposes of CBOE Rule 6.2B, the primary
volume market will be defined as the market with
the most liquidity in that underlying security for
the previous two calendar months.
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(5).
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]]>Agencies
[Federal Register Volume 72, Number 167 (Wednesday, August 29, 2007)]
[Notices]
[Pages 49750-49752]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-17082]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56307; File No. SR-Amex-2007-96]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing of Proposed Rule Change Relating to an Extension of
the Options Penny Quoting Pilot Program
August 22, 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 August 21, 2007, the American Stock Exchange LLC (``Amex'' 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 Amex.\3\
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ The Commission notes that the proposed rule change submitted
by the Exchange contained non-substantive errors, which, for the
purpose of this notice, have been corrected. The Exchange has
committed to address these errors formally in an amendment to the
proposed rule change following publication of this notice. Telephone
conversation between Jeffrey Burns, Vice President and Associate
General Counsel and Jennifer Colihan, Special Counsel, Division of
Market Regulation, Commission on August 22, 2007.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to (i) Expand the current pilot program for
the quoting of a limited number of options classes in pennies (the
``Penny Quoting Pilot Program'' or ``Pilot Program'') and (ii) extend
the Pilot Program through March 27, 2009. The text of the proposed rule
change is available at https://www.amex.com, at the Exchange, 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
The Amex is proposing to expand the current Penny Pilot Quoting
Pilot Program \4\ which commenced on January 26, 2007. The Exchange
believes that expanding the current Pilot Program, as proposed in this
rule filing, will allow further analysis and review of the impact of
penny quoting based on a greater number of actively-traded options
classes.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 55162 (January 24,
2007), 72 FR 4738 (February 1, 2007).
---------------------------------------------------------------------------
The current Penny Quoting Pilot Program includes thirteen (13)
options classes. The Pilot Program was recently extended by the
Exchange through September 27, 2007.\5\ The Exchange intends to roll-
out the proposed expansion of the Pilot Program in two (2) phases.
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 56159 (July 27,
2007), 72 FR 43300 (August 3, 2007).
---------------------------------------------------------------------------
First, commencing on September 28, 2007, the Exchange will include
the twenty-two (22) most actively-traded, multiply-listed options
classes (excluding Google (GOOG), Nasdaq-100 Index (NDX) and the
Russell 2000 Index (RUT)) in the Penny Quoting Pilot Program. The
Exchange also proposes to set forth in a Regulatory Circular the list
of the options classes subject to the proposed expansion of the Pilot
Program. In addition to the thirteen (13) options classes that are
currently part of the Pilot Program, this would expand the Penny
Quoting Pilot Program to include approximately 35% of total industry
options volume.
Second, the Exchange on March 28, 2008 would further commence an
expansion of the Pilot Program to last for one (1) year through March
27, 2009. Amex anticipates that an additional twenty-eight (28) option
classes will be added to the Penny Quoting Pilot Program at that time
such that the Pilot would include the Top 50 multiply-listed options
classes by national volume. As a result, the Pilot Program would then
consist of sixty-three (63) options classes. The Exchange will
[[Page 49751]]
submit a proposed rule change pursuant to section 19(b)(3)(A) of the
Securities Exchange Act of 1934 identifying the options classes to be
included in the second phase of the Pilot Program expansion.
The Exchange believes that the proposed expansion is a measured
increase to the existing Pilot Program given system capacity
constraints and concerns that exist industry-wide. As set forth in the
Exchange's original rule filing in connection with the Pilot Program,
the Amex believes that a considerate and measured expansion is required
because quoting options in pennies is expected to increase quote
message traffic. The Exchange believes that the proposed expansion of
options classes that may quote in pennies under the Pilot Program is
reasonable given the system capacity constraints and quote mitigation
strategies in place at the Amex as well as the other options exchanges.
The Exchange represents that it will submit reports analyzing the
Pilot Program for the following time periods: (i) May 1, 2007 through
September 27, 2007; (ii) September 28, 2007 through January 31, 2008;
(iii) February 1, 2008 through July 31, 2008; and (iv) August 1, 2008
through January 31, 2009. The Pilot Reports will be submitted to the
Commission within thirty (30) days of the end of such time periods. The
Exchange expects the Pilot Reports, among other things, to assess the
impact of the Pilot Program during the relevant time period comparing
quotation and trading activity as follows: (1) Quotation spread,
quotation size, average daily volume and other relevant factors: (2)
the number of quotations in the Penny Quoting Pilot Program and the
effect on Amex system's capacity; and (3) an assessment of trade-
throughs and how they were addressed.
The quoting requirements in connection with the Penny Quoting Pilot
Program will continue to provide for (i) A minimum price variation
(``MPV'') of $0.01 for options with premiums of up to $3 or (ii) a MPV
of $0.05 for options with premiums of $3 or greater, except for QQQQ
options which trade at an MPV of $0.01 for all premiums.
As part of the Penny Quoting Pilot Program, the Exchange
implemented quote mitigation strategies due to concerns regarding
system capacity. The Exchange believes that the quote mitigation
strategies in place since the introduction of the Pilot Program
continue to be effective. Therefore, in this filing, the Exchange is
also proposing to further extend the effectiveness of the quote
mitigation strategies through March 27, 2009.
Finally, the Exchange believes that an additional extension of the
Penny Quoting Pilot Program through March 27, 2009 is warranted and
appropriate for the purpose of implementing the proposed expansion.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with section 6(b) of the Act,\6\ in general, and furthers the
objectives of section 6(b)(5) of the Act,\7\ in particular, in that the
proposed rule change is designed to prevent fraudulent and manipulative
acts and practices, to promote just and equitable principles of trade,
to remove impediments to and perfect the mechanism of a free and open
market and a national market system, and, in general, to protect
investors and the public interest.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in 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
Written comments on the proposed rule change were neither solicited
nor received.
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 Exchange 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. The Commission also requests and
encourages interested persons to submit comments on the following
specific questions:
Whether there are circumstances under which options
classes included in the Penny Pilot should be removed from the Pilot?
If so, what factors should be considered in making the
determination to remove an option class from the Penny Pilot?
[cir] Should an objective standard be used? For instance, should an
option class come out of the Penny Pilot if its trading volume drops
below a threshold amount? If so, what should that threshold be? Or,
should an option class come out of the Penny Pilot if it is no longer
among the most actively-traded options? If so, what should be
considered the most-actively traded options? What statistics or
analysis should be used to support a determination to remove an options
class?
[cir] Should a more subjective analysis be allowed? If so, what
factors should be taken into account?
What concerns might arise by removing an option from the
Penny Pilot? How could such concerns be ameliorated?
How frequently should the analysis be undertaken (e.g.,
annually, bi-annually, quarterly), or should the evaluation be an
automated process?
If a determination is made that an option should be
removed from the Penny Pilot, how much notice should be given to market
participants that the quoting increment will change?
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-Amex-2007-96 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-Amex-2007-96. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (https://www.sec.gov/
rules/sro.shtml ). Copies of the
[[Page 49752]]
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 the Exchange. 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-2007-96 and should be submitted on or before
September 19, 2007.
For the Commission, by the Division of Market Regulation, pursuant
to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-17082 Filed 8-28-07; 8:45 am]
BILLING CODE 8010-01-P
