Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Amending the Payment for Order Flow Plan To Apply the Current Marketing Fee to Orders Sent to Directed Order Participants, 50994-50996 [E7-17478]
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50994
Federal Register / Vol. 72, No. 171 / Wednesday, September 5, 2007 / Notices
rfrederick on PROD1PC67 with NOTICES
section 22(e) was designed to prevent.
Applicants state that the SAI for each
International Fund will disclose those
local holidays (over the period of at
least one year following the date of the
SAI), if any, that are expected to prevent
the delivery of redemption proceeds in
seven calendar days, and the maximum
number of days needed to deliver the
proceeds for the relevant International
Fund.
Future Relief
3. Applicants also seek to amend the
Prior Order to modify the terms under
which the Trust may offer Future
Funds. The Prior Order is currently
subject to a condition that does not
permit relief for Future Funds unless
applicants request and receive with
respect to such Future Fund, either
exemptive relief from the Commission
or a no-action letter from the Division of
Investment Management of the
Commission, or the Future Fund could
be listed on an Exchange without the
need for a filing pursuant to rule 19b–
4 under the Exchange Act.
4. The order would amend the Prior
Order to delete this condition. Any
Future Fund will: (a) Be advised by the
Adviser, or an entity controlled by or
under common control with the
Adviser; (b) track an Underlying Index
that is created, compiled, sponsored or
maintained by an entity that is not an
affiliated person, as defined in section
2(a)(3) of the Act, or an affiliated person
of an affiliated person, of the Adviser,
the Distributor, the Trust or any SubAdviser or promoter of a Fund; and (c)
comply with the respective terms and
conditions of the Prior Order, as
amended by the present application.
5. Applicants believe that the
modification of the future relief
available under the Prior Order would
be consistent with sections 6(c) and
17(b) of the Act and that granting the
requested relief will facilitate the timely
creation of Future Funds by removing
the need to seek additional exemptive
relief. Applicants submit that the terms
and conditions of the Prior Order have
been appropriate for the existing Funds
and would remain appropriate for
Future Funds. Applicants also submit
that tying exemptive relief under the
Act to the ability of a Future Fund to be
listed on an Exchange without the need
for a rule 19b–4 filing under the
Exchange Act is not necessary to meet
the standards under sections 6(c) and
17(b) of the Act.
Applicants’ Condition
Applicants agree that any order
granting the requested relief will be
subject to the same conditions as those
VerDate Aug<31>2005
13:51 Sep 04, 2007
Jkt 211001
imposed by the Prior Order, except for
condition 1 to the Prior Order, which
will be deleted.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Nancy M. Morris,
Secretary.
[FR Doc. E7–17499 Filed 9–4–07; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–56330; File No. SR–Amex–
2007–92]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing and Immediate Effectiveness
of a Proposed Rule Change Amending
the Payment for Order Flow Plan To
Apply the Current Marketing Fee to
Orders Sent to Directed Order
Participants
August 28, 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
20, 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 the
Exchange. Amex has designated this
proposal as one establishing or changing
a due, fee, or other charge imposed by
Amex 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
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend its
Payment for Order Flow Plan to apply
the current marketing fee to orders sent
to Directed Order Participants.5 The text
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 The Exchange’s Directed Order Program (the
‘‘Program’’) was recently approved by the
Commission. See Securities Exchange Act Release
No. 56269 (August 15, 2007), 72 FR 47086 (August
22, 2007) (Notice of Filing and Order Granting
Accelerated Approval of SR–Amex 2007–75). A
Directed Order Participant, as defined in proposed
Rule 996–ANTE is any specialist, Registered
2 17
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Fmt 4703
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of the proposed rule change is available
at the Exchange, the Commission’s
Public Reference Room, and https://
www.amex.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
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. Amex
has substantially 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 the
current fee schedule to apply the
marketing fee charged to equity options
(the ‘‘Payment for Order Flow Plan’’) to
orders sent to Directed Order
Participants.6
A Directed Order Participant may
choose to opt in or opt out of the
Payment for Order Flow Plan.7 If the
Directed Order Participant chooses to
opt into the Payment for Order Flow
Plan, the Exchange will collect the
applicable marketing fee per contract
from the participating specialists, ROTs,
RROTs, and SROTs, for all electronic
customer orders directed to that
Directed Order Participant. The pool of
funds collected would be used to fund
Options Trader (‘‘ROT’’), Supplemental Registered
Options Trader (‘‘SROT’’), and Remote Registered
Options Trader (‘‘RROT’’) that enters into
arrangements with an Order Flow Provider,
whereby they could receive directed orders upon
meeting certain eligibility requirements.
6 Under the current plan, the Exchange charges an
equity options marketing fee of $0.75, $0.35, or
$0.40 per contract solely to customer orders that are
from payment accepting firms with whom a
specialist or SROT has negotiated a payment for
order flow arrangement. SPDR Options are
currently subject to a $1.00 or $.40 per contract fee.
The $0.75 and $0.35 fee solely applies to those
orders that are executed electronically through the
Exchange’s ANTE system, while the $0.40 fee
applies to those series of equity options, exchange
traded fund share options (including SPY options),
Trust Issued Receipt Options, NDX, and RUT
options that are manually executed customer orders
of 1,000 contracts or greater.
7 Once a Directed Order Participant opts into the
Payment for Order Flow Plan, no notice to the
Exchange is required in a subsequent month unless
there is a change in the participation status.
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05SEN1
rfrederick on PROD1PC67 with NOTICES
Federal Register / Vol. 72, No. 171 / Wednesday, September 5, 2007 / Notices
Payment for Order Flow arrangements
with payment accepting firms.
A Directed Order Participant who
chooses to opt into the Payment for
Order Flow Plan must notify the
Exchange of the election to participate
in the Payment for Order Flow Plan no
later than two business days prior to the
date on which the marketing fee would
be assessed. Directed Order Participants
may only opt into or out of the
Exchange’s Payment for Order Flow
Plan one time in any given month. If at
any time during a month a Directed
Order Participant opts into the Payment
for Order Flow Plan, the marketing fee
would be assessed for that remaining
portion of the month commencing on
the third business day following notice
to the Exchange.
Directed Order Participants who enter
into a Payment for Order Flow
arrangement with an Order Flow
Provider will be given instructions as to
how to submit their payment directions.
The Exchange will not be involved in
negotiating the terms governing the
orders that qualify for payment or the
amount of any payment. The Exchange
will, however, pay the requested
amount to the Order Flow Provider on
behalf of the Directed Order Participant.
The requested amount is limited to the
amount billed and collected for that
month, plus any excess funds that were
carried over from previous months
(funds collected but not requested by a
Directed Order Participant).
The Exchange will further provide
administrative support for the program
in such matters as maintaining the
funds, keeping track of the number of
qualified orders each Directed Order
Participant directs to the Exchange, and
making payments to the Order Flow
Providers on behalf of, and at the
direction of, the Directed Order
Participants.
Separate pools of funds will be
available to each Directed Order
Participant solely for those trades where
the marketing fee was assessed, at the
post it was collected. This pool of funds
will be used by each Directed Order
Participant to attract customer orders to
the Exchange from Order Flow
Providers.8 The Exchange notes that
Directed Order Participants are limited
to spending any funds collected from
SROTs only in those options classes in
which the SROT is able to trade.
Directed Order Participants
participating in the Exchange’s current
Payment for Order Flow Plan will be
8 The Exchange notes that if a specialist acts as
a Directed Order recipient and specialist, there shall
be two separate pools of funds collected for each.
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13:51 Sep 04, 2007
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50995
rebated any unused funds at the end of
a quarter on a pro rata basis.9
Finally, the Exchange proposes to
amend Footnote 11 in the Options Fee
Schedule, to clarify that that the $.40
options marketing fee, which only
applies to manually executed orders,
shall not be applicable to Directed
Orders, since they are solely
electronically executed orders.
IV. Solicitation of Comments
2. Statutory Basis
• 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–2007–92 on the
subject line.
The Exchange believes that the
proposed rule change is consistent with
section 6(b) of the Act 10 in general, and
section 6(b)(4) of the Act 11 in particular,
in that it is designed to provide for an
equitable allocation of reasonable dues,
fees, and other charges among exchange
members and other persons using
exchange facilities.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange 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
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 been designated as a fee change
pursuant to section 19(b)(3)(A)(ii) of the
Act 12 and Rule 19b–4(f)(2) 13
thereunder, because it establishes or
changes a due, fee, or other charge
imposed by the Exchange. Accordingly,
the proposal will take effect upon filing
with the Commission. At any time
within 60 days of the filing of such
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.
9 Specialists, SROTs, RROTs, or ROTs
participating in the Exchange’s current marketing
fee program are rebated any unused funds at the
end of a quarter on a pro rata basis.
10 15 U.S.C. 78f(b).
11 15 U.S.C. 78f(b)(4).
12 15 U.S.C. 78s(b)(3)(A)(ii).
13 17 CFR 240.19b–4(f)(2).
PO 00000
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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
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–2007–92. 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
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–2007–92 and should
be submitted on or before September 26,
2007.
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50996
Federal Register / Vol. 72, No. 171 / Wednesday, September 5, 2007 / Notices
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.14
Nancy M. Morris,
Secretary.
[FR Doc. E7–17478 Filed 9–4–07; 8:45 am]
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. Amex
has substantially prepared summaries,
set forth in Sections A, B, and C below,
of the most significant aspects of such
statements.
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–56331; File No. SR–Amex–
2007–93]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing and Immediate Effectiveness
of a Proposed Rule Change Relating to
the Options Directed Order Participant
Transaction Charge Rebate Program
August 28, 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
20, 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 the
Exchange. Amex has designated this
proposal as one establishing or changing
a due, fee, or other charge imposed by
Amex 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
from interested persons.
rfrederick on PROD1PC67 with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to extend the
transaction charge rebates currently
applicable to supplemental registered
options traders (‘‘SROTs’’) to all
Directed Order Participants. The text of
the proposed rule change is available at
the Exchange, the Commission’s Public
Reference Room, and https://
www.amex.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
14 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
4 17 CFR 240.19b–4(f)(2).
1 15
VerDate Aug<31>2005
13:51 Sep 04, 2007
Jkt 211001
The Exchange notes that Directed
Order Participants are entitled to the
options transaction charge rebate, which
is separate and apart from the
Exchange’s Payment for Order Flow
Plan.9 The proposed options transaction
charge rebate, which is provided to
Directed Order Participants, will not
come from the marketing fees collected
on those transactions.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act 10 in general, and
Section 6(b)(4) of the Act 11 in
particular, in that it is designed to
provide for an equitable allocation of
reasonable dues, fees, and other charges
among exchange members and other
persons using exchange facilities.
1. Purpose
The Exchange proposes to extend the
options transaction charge 5 rebates
currently applicable to SROTs 6 to all
Directed Order Participants (including
SROTs) that provide liquidity to the
Exchange and receive electronic
directed customer orders (the ‘‘Directed
Order Fee Rebate Program’’). This
Directed Order Fee Rebate Program
would provide fee rebates to Directed
Order Participants that provide order
flow to the Exchange from an order flow
provider firm.7
This proposal would allow the
Exchange to provide Directed Order
Participants with options transaction
charge rebates for the number of options
contracts that are electronically directed
to them and executed on the Exchange.
The following rebate schedule is
proposed:
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange 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
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
Monthly directed order volume
Rebate per Commission Action
(in contracts)
contract
The foregoing proposed rule change
0–1,000,000 ..............................
$0.05 has been designated as a fee change
1,000,001–2,000,000 ................
.10 pursuant to Section 19(b)(3)(A)(ii) of the
2,000,001–3,000,000 ................
.125 Act 12 and Rule 19b–4(f)(2) 13
3,000,001 and up .....................
.15 thereunder, because it establishes or
changes a due, fee, or other charge
Rebates would be capped at 100% of
imposed by the Exchange. Accordingly,
transaction charges so that once a
the proposal will take effect upon filing
Directed Order Participant’s transaction with the Commission. At any time
charges reach zero, the Exchange would within 60 days of the filing of such
not pay out any additional credits.8
proposed rule change the Commission
may summarily abrogate such rule
5 The options transaction charge is the collective
change if it appears to the Commission
of the Options Transaction Fee, the Options
that such action is necessary or
Comparison Fee, and the Options Floor Brokerage
appropriate in the public interest, for
fee, as noted on the Options Fee Schedule.
6 See Securities Exchange Act Release No. 56002
the protection of investors, or otherwise
(July 2, 2007), 72 FR 37548 (July 10, 2007) (SR–
in furtherance of the purposes of the
Amex 2007–55).
Act.
7 See Securities Exchange Act Release No. 56269
(August 15, 2007), 72 FR 47086 (August 22, 2007)
(Notice of Filing and Order Granting Accelerated
Approval of SR–Amex 2007–75). Generally, for
purposes of the Directed Order Flow Program, a
directed order is deemed to be an electronic
customer order from an order flow provider that is
directed to a specific specialist, registered options
trader (‘‘ROT’’), SROT, or remote registered options
trader (‘‘RROT’’).
8 For example, a Directed Order Participant which
pays $100,000 in transaction charges per month,
could not receive more than a $100,000 rebate.
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IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
9 See
supra note 7.
U.S.C. 78f(b).
11 15 U.S.C. 78f(b)(4).
12 15 U.S.C. 78s(b)(3)(A)(ii).
13 17 CFR 240.19b–4(f)(2).
10 15
E:\FR\FM\05SEN1.SGM
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]]>Agencies
[Federal Register Volume 72, Number 171 (Wednesday, September 5, 2007)]
[Notices]
[Pages 50994-50996]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-17478]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56330; File No. SR-Amex-2007-92]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Amending the Payment for Order Flow Plan To Apply the Current Marketing
Fee to Orders Sent to Directed Order Participants
August 28, 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 20, 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 the
Exchange. Amex has designated this proposal as one establishing or
changing a due, fee, or other charge imposed by Amex 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 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)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend its Payment for Order Flow Plan to
apply the current marketing fee to orders sent to Directed Order
Participants.\5\ The text of the proposed rule change is available at
the Exchange, the Commission's Public Reference Room, and https://
www.amex.com.
---------------------------------------------------------------------------
\5\ The Exchange's Directed Order Program (the ``Program'') was
recently approved by the Commission. See Securities Exchange Act
Release No. 56269 (August 15, 2007), 72 FR 47086 (August 22, 2007)
(Notice of Filing and Order Granting Accelerated Approval of SR-Amex
2007-75). A Directed Order Participant, as defined in proposed Rule
996-ANTE is any specialist, Registered Options Trader (``ROT''),
Supplemental Registered Options Trader (``SROT''), and Remote
Registered Options Trader (``RROT'') that enters into arrangements
with an Order Flow Provider, whereby they could receive directed
orders upon meeting certain eligibility requirements.
---------------------------------------------------------------------------
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. Amex has substantially 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 the current fee schedule to apply
the marketing fee charged to equity options (the ``Payment for Order
Flow Plan'') to orders sent to Directed Order Participants.\6\
---------------------------------------------------------------------------
\6\ Under the current plan, the Exchange charges an equity
options marketing fee of $0.75, $0.35, or $0.40 per contract solely
to customer orders that are from payment accepting firms with whom a
specialist or SROT has negotiated a payment for order flow
arrangement. SPDR Options are currently subject to a $1.00 or $.40
per contract fee. The $0.75 and $0.35 fee solely applies to those
orders that are executed electronically through the Exchange's ANTE
system, while the $0.40 fee applies to those series of equity
options, exchange traded fund share options (including SPY options),
Trust Issued Receipt Options, NDX, and RUT options that are manually
executed customer orders of 1,000 contracts or greater.
---------------------------------------------------------------------------
A Directed Order Participant may choose to opt in or opt out of the
Payment for Order Flow Plan.\7\ If the Directed Order Participant
chooses to opt into the Payment for Order Flow Plan, the Exchange will
collect the applicable marketing fee per contract from the
participating specialists, ROTs, RROTs, and SROTs, for all electronic
customer orders directed to that Directed Order Participant. The pool
of funds collected would be used to fund
[[Page 50995]]
Payment for Order Flow arrangements with payment accepting firms.
---------------------------------------------------------------------------
\7\ Once a Directed Order Participant opts into the Payment for
Order Flow Plan, no notice to the Exchange is required in a
subsequent month unless there is a change in the participation
status.
---------------------------------------------------------------------------
A Directed Order Participant who chooses to opt into the Payment
for Order Flow Plan must notify the Exchange of the election to
participate in the Payment for Order Flow Plan no later than two
business days prior to the date on which the marketing fee would be
assessed. Directed Order Participants may only opt into or out of the
Exchange's Payment for Order Flow Plan one time in any given month. If
at any time during a month a Directed Order Participant opts into the
Payment for Order Flow Plan, the marketing fee would be assessed for
that remaining portion of the month commencing on the third business
day following notice to the Exchange.
Directed Order Participants who enter into a Payment for Order Flow
arrangement with an Order Flow Provider will be given instructions as
to how to submit their payment directions. The Exchange will not be
involved in negotiating the terms governing the orders that qualify for
payment or the amount of any payment. The Exchange will, however, pay
the requested amount to the Order Flow Provider on behalf of the
Directed Order Participant. The requested amount is limited to the
amount billed and collected for that month, plus any excess funds that
were carried over from previous months (funds collected but not
requested by a Directed Order Participant).
The Exchange will further provide administrative support for the
program in such matters as maintaining the funds, keeping track of the
number of qualified orders each Directed Order Participant directs to
the Exchange, and making payments to the Order Flow Providers on behalf
of, and at the direction of, the Directed Order Participants.
Separate pools of funds will be available to each Directed Order
Participant solely for those trades where the marketing fee was
assessed, at the post it was collected. This pool of funds will be used
by each Directed Order Participant to attract customer orders to the
Exchange from Order Flow Providers.\8\ The Exchange notes that Directed
Order Participants are limited to spending any funds collected from
SROTs only in those options classes in which the SROT is able to trade.
Directed Order Participants participating in the Exchange's current
Payment for Order Flow Plan will be rebated any unused funds at the end
of a quarter on a pro rata basis.\9\
---------------------------------------------------------------------------
\8\ The Exchange notes that if a specialist acts as a Directed
Order recipient and specialist, there shall be two separate pools of
funds collected for each.
\9\ Specialists, SROTs, RROTs, or ROTs participating in the
Exchange's current marketing fee program are rebated any unused
funds at the end of a quarter on a pro rata basis.
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Finally, the Exchange proposes to amend Footnote 11 in the Options
Fee Schedule, to clarify that that the $.40 options marketing fee,
which only applies to manually executed orders, shall not be applicable
to Directed Orders, since they are solely electronically executed
orders.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with section 6(b) of the Act \10\ in general, and section 6(b)(4) of
the Act \11\ in particular, in that it is designed to provide for an
equitable allocation of reasonable dues, fees, and other charges among
exchange members and other persons using exchange facilities.
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\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange 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
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 been designated as a fee
change pursuant to section 19(b)(3)(A)(ii) of the Act \12\ and Rule
19b-4(f)(2) \13\ thereunder, because it establishes or changes a due,
fee, or other charge imposed by the Exchange. Accordingly, the proposal
will take effect upon filing with the Commission. At any time within 60
days of the filing of such 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.
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\12\ 15 U.S.C. 78s(b)(3)(A)(ii).
\13\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change 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-Amex-2007-92 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-2007-92. 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 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-2007-92 and should be
submitted on or before September 26, 2007.
[[Page 50996]]
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E7-17478 Filed 9-4-07; 8:45 am]
BILLING CODE 8010-01-P
