Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change as Modified by Amendment No. 2 Thereto Relating to Exchange Fees and Charges, 57372-57374 [E7-19765]

Download as PDF 57372 Federal Register / Vol. 72, No. 194 / Tuesday, October 9, 2007 / Notices 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 Commissions 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 the NYSE. 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–NYSE–2007–89 and should be submitted on or before October 30, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 Nancy M. Morris, Secretary. [FR Doc. E7–19751 Filed 10–5–07; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56595; File No. SR– NYSEArca–2007–93] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change as Modified by Amendment No. 2 Thereto Relating to Exchange Fees and Charges October 1, 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 September 18, 2007, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed with the Securities and Exchange mstockstill on PROD1PC66 with NOTICES DATE: Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by the Exchange. On September 28, 2007, the NYSE Arca submitted Amendment No. 1 to the proposed rule change. On September 28, 2007, NYSE Arca withdrew Amendment No. 1 and filed Amendment No. 2. NYSE Arca has designated this proposal as one establishing or changing a due, fee, or other charge imposed by NYSE Arca under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change NYSE Arca proposes to amend its Schedule of Fees and Charges for Exchange Services (‘‘Rate Schedule’’). The text of the proposed rule change is available at the Exchange, the Commission’s Public Reference Room, and http://www.nysearca.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. NYSE Arca 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 NYSE Arca states that the purpose of this filing is to amend the existing NYSE Arca Rate Schedule by establishing a pilot program under which the Exchange will cap, on a monthly basis, the Firm Facilitation Fee (‘‘Pilot Program’’). The Exchange also proposes to apply the Firm Facilitation Fee when non-OTP Firm 5 accounts, as well as 3 15 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 5 A non-OTP Firm is a broker dealer whose proprietary trades clear as Firm (clearance symbol 8 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. VerDate Aug<31>2005 17:07 Oct 05, 2007 4 17 Jkt 214001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 OTP Firm accounts, are used to facilitate customer orders. The Exchange also proposes adding language to the Rate Schedule, to clarify that the Firm Facilitation Fee is applicable to manually executed orders only. Although effective upon filing, the Exchange intends this fee change to become operative on October 1, 2007. NYSE Arca presently charges OTP Holders a Firm Facilitation Fee of $0.15 per contract. The Firm Facilitation Fee is applicable when a proprietary trading account of an OTP Firm is used to facilitate an order for a customer of the OTP Firm. As part of this filing, the Exchange is now proposing to apply the Firm Facilitation Fee to any transaction in which a firm proprietary account, of either an OTP Firm or non-OTP Firm, is used to facilitate an order for a customer of that same firm.6 Presently, OTP Firms are charged the Broker Dealer & Firm Manual rate of $0.26 for facilitation trades they execute on behalf of nonOTP firms. According to the proposal, the Exchange will now apply the Firm Facilitation rate of $0.15 to such trades. The Exchange proposes to establish a pilot program, under which OTP Firms will be eligible for a monthly cap of $50,000 on Firm Facilitation Fees. The $50,000 cap will be applicable to each firm account that is used for facilitating orders of customers of that same firm. Examples of how the Firm Facilitation Fee cap will be applied are shown below. Example 1 OTP Firm A carries accounts for customers of the firm, for which the firm may, on occasion, facilitate certain option orders. During a given calendar month, the firm facilitates a number of orders for their customers, for which the firm incurs Firm Facilitation Fees totaling $60,000. Under the Pilot Program, the fee cap would have been met, and the Firm would be billed only $50,000. Example 2 OTP Firm B carries accounts of public customers, as well as accounts of non-OTP Firms, who themselves may wish to facilitate orders for their own customers. During a given calendar month, OTP Firm B represents facilitation orders for a non-OTP Firm for which it incurs Firm Facilitation Fees totaling $60,000. During the same month, OTP Firm B also represents facilitation orders for another non-OTP Firm for which they incur Facilitation Fees totaling $60,000. While OTP Firm B itself has F) with the Options Clearing Corporation (‘‘OCC’’) and is not an NYSE Arca OTP holder. 6 In both instances the Firm Facilitation Fee will be applied to trades that have an OCC clearance account ‘‘F’’ on the trade side and an OCC clearance account ‘‘C’’ on the contra side of the transaction. Both sides of the trade will clear under the same clearing firm symbol. E:\FR\FM\09OCN1.SGM 09OCN1 Federal Register / Vol. 72, No. 194 / Tuesday, October 9, 2007 / Notices incurred $120,000 in total Facilitation Fees for the month, the entire amount is not eligible for the fee cap. Orders on behalf of the first non-OTP Firm, which amounted to $60,000, are capped at $50,000, while orders on behalf of the second non-OTP Firm, which amounted to $60,000, are also capped at $50,000. In this example, OTP Firm B has incurred Facilitation Fees totaling $120,000, but because the fees are eligible for the fee cap under the Pilot Program, OTP Firm B will be billed only $100,000. mstockstill on PROD1PC66 with NOTICES Example 3 OTP Firm C carries accounts of public customers, as well as accounts of non-OTP Firms, who themselves may wish to facilitate orders for their own customers. During a given calendar month, OTP Firm C facilitates orders for their customers, for which the firm incurs Firm Facilitation Fees totaling $60,000. During the same calendar month, OTP Firm C represents facilitation orders for a non-OTP Firm for which it incurs Facilitation Fees totaling $60,000. During the same month, OTP Firm C also represents facilitation orders for another non-OTP Firm for which the firm incurs Facilitation Fees totaling $40,000. While OTP Firm C itself has incurred $160,000 in total Firm Facilitation Fees for the month, the entire amount is not eligible for the fee cap. Facilitated orders, executed on behalf of OTP Firm C’s customer, which amounted to $60,000, are capped at $50,000. Facilitated orders executed on behalf of the first non-OTP Firm, which amounted to $60,000, are also capped at $50,000, but facilitated orders executed on behalf of the second non-OTP Firm, which amounted to $40,000, are not subject to the fee cap. In this example, OTP Firm C has incurred Firm Facilitation Fees totaling $160,000, but because of the fee cap under the Pilot Program, OTP Firm C will be billed only $140,000. OTP Firms wishing to take advantage of the fee cap must register for the Pilot Program with the NYSE Arca Finance Department, prior to the end of a calendar month, to ensure that the fee cap is applied correctly for billing purposes, for that month. The enrollment process will require that an OTP Firm supply the Exchange with information concerning the clearing and firm symbols of the OTP Firm’s designated clearing account that may be used to facilitate customer orders, and/ or the clearing and firm symbols of any non-OTP Firm customers of the OTP Firm that may facilitate their own customer’s orders. Enrollment forms will be available from the NYSE Arca Finance Department. The enrollment information can be provided by the initiating firm, clearing firm or executing broker associated with these trades. Certain classes of options listed on the NYSE Arca have as their underlying security, licensed products that carry a Royalty Fee (or license fee), on every contract traded. Royalty Fees that are VerDate Aug<31>2005 17:07 Oct 05, 2007 Jkt 214001 incurred by the Exchange are passed-on to the actual participants executing the trade. These passed-through fees are assessed by the issuing agency, and are not Exchange Transaction Fees. The Exchange will not include Royalty Fees, which are passed-on to trade participants in connection with Firm Facilitation trades, when calculating the $50,000 per month fee cap. By capping this Firm Facilitation Fee, the Exchange states that it hopes to garner additional order flow from market participants that are attracted to the competitive fee structure. The Exchange plans to offer this fee cap on a pilot basis until December 31, 2007. Thirty days prior to the conclusion of the Pilot Program, the Exchange will analyze the effectiveness of the fee cap and will propose, through a subsequent Rule 19b4 filing, to either terminate or extend the Pilot Program, or to make the fee cap permanent. Facilitation trades, governed by NYSE Arca Rule 6.47, are Crossing Orders, and are manually executed by Floor Brokers. Until such time that the Exchange’s electronic trading system’s automated crossing mechanism is functional, all Crossing Orders are executed manually. Therefore the Firm Facilitation Fee is only applicable to manual executions. The Exchange proposes at this time to add language to the Rate Schedule to clarify this. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 7 in general, and furthers the objectives of Section 6(b)(4) of the Act 8 in particular, in that it is designed to provide for the equitable allocation of reasonable dues, fees, and other charges among NYSE Arca members. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange believes that the proposed rule change will 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 The Exchange has neither solicited nor received written comments on the proposed rule change. 7 15 8 15 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(4). Frm 00090 Fmt 4703 Sfmt 4703 57373 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 9 and Rule 19b–4(f)(2) 10 thereunder, because it establishes or changes a due, fee, or other charge imposed on members 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.11 IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSEArca–2007–93 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–NYSEArca–2007–93. 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 9 15 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 11 For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change, the Commission considers the period to commence on September 28, 2007, the date on which the Exchange filed Amendment No. 2. See 15 U.S.C. 78s(b)(3)(C). 10 17 E:\FR\FM\09OCN1.SGM 09OCN1 57374 Federal Register / Vol. 72, No. 194 / Tuesday, October 9, 2007 / Notices 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–NYSEArca–2007–93 and should be submitted on or before October 30, 2007. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.12 Nancy M. Morris, Secretary. [FR Doc. E7–19765 Filed 10–5–07; 8:45 am] BILLING CODE 8011–01–P DEPARTMENT OF STATE Dated: September 10, 2007. Stephen D. Mull, Acting Assistant Secretary of State, Bureau of Political-Military Affairs, Department of State. [FR Doc. E7–19807 Filed 10–5–07; 8:45 am] [Public Notice 5953] Termination of Statutory Debarment Pursuant to Section 38(g)(4) of the Arms Export Control Act for Davilyn Corporation mstockstill on PROD1PC66 with NOTICES ACTION: BILLING CODE 4710–25–P Notice. SUMMARY: Notice is hereby given that the Department of State has terminated the statutory debarment against Davilyn Corporation pursuant to Section 38(g)(4) of the Arms Export Control Act (AECA) (22 U.S.C. 2778). EFFECTIVE DATE: October 9, 2007. FOR FURTHER INFORMATION CONTACT: David C. Trimble, Director, Office of Defense Trade Controls Compliance, Directorate of Defense Trade Controls, Bureau of Political-Military Affairs, Department of State (202) 663–2807. SUPPLEMENTARY INFORMATION: Section 38(g)(4) of the AECA and Section 127.11 of the ITAR prohibit the issuance of export licenses or other approvals to a person, or any party to the export, who has been convicted of violating the AECA and certain other U.S. criminal statutes enumerated at section 38(g)(1)(A) of the AECA and Section 120.27 of the ITAR. A person convicted 12 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 17:07 Oct 05, 2007 of violating the AECA is also subject to statutory debarment under Section 127.7 of the ITAR. In June 2005, Davilyn Corporation was convicted of violating the AECA and the ITAR (U.S. District Court, District of California, CR 05–00432– RMT). Based on this conviction, Davilyn Corporation was statutorily debarred pursuant to Section 38(g)(4) of the AECA and Section 127.7 of the ITAR and, thus, prohibited from participating directly or indirectly in exports of defense articles and defense services. Notice of debarment was published in the Federal Register (70 FR 69260, November 16, 2005). Section 38(g)(4) of the AECA permits termination of debarment after consultation with the other appropriate U.S. agencies and after a thorough review of the circumstances surrounding the conviction and a finding that appropriate steps have been taken to mitigate any law enforcement concerns. The Department of State has determined that Davilyn Corporation has taken appropriate steps to address the causes of the violations and to mitigate any law enforcement concerns. Therefore, in accordance with Section 38(g)(4) of the AECA, the debarment against Davilyn Corporation is rescinded, effective October 9, 2007. Jkt 214001 DEPARTMENT OF TRANSPORTATION Office of the Secretary [Docket No. OST–2004–16951] Notice of Request for Renewal of a Previously Approved Collection Office of the Secretary, DOT. Notice. AGENCY: ACTION: SUMMARY: In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35, as amended), this notice announces that the Information Collection Request (ICR) abstracted below will be forwarded to the Office of Management and Budget (OMB) for renewal and comment. The ICR describes the nature of the information collection and its expected costs and burden. The Federal Register Notice with a 60-day comment period soliciting comments on the following collection of information was published on August 1, PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 2007 [Vol. 72, No. 147, Page 42218]. No comments were received. DATES: Comments on this notice must be received by November 8, 2007 and sent to the attention of the DOT/OST Desk Officer, Office of Information and Regulatory Affairs, Office of Management and Budget, Docket Library, Room 10102, 725 17th Street, NW., Washington, DC 20503. ADDRESSES: You may submit comments [identified by DOT DMS Docket Number OST–2004–16951] by any of the following methods: • Web Site: http://dms.dot.gov. Follow the instructions for submitting comments on the DOT electronic docket site. • Fax: 1–202–493–2251. • Mail: Docket Management Facility; U.S. Department of Transportation, 1200 New Jersey Avenue, SE., W12–140, Washington, DC 20590. • Hand Delivery: Room W12–140, 1200 New Jersey Avenue, SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except on Federal holidays. • Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting comments. Instructions: All submissions must include the agency name and docket number or Regulatory Identification Number (RIN) for this rulemaking. For detailed instructions on submitting comments and additional information on the rulemaking process, see the Public Participation heading of the Supplementary Information section of this document. Note that all comments received will be posted without change to http://dms.dot.gov including any personal information provided. Please see the Privacy Act heading under Regulatory Notes. Docket: For access to the docket to read background documents or comments received, go to http:// dms.dot.gov at any time or to W12–140, 1200 New Jersey Avenue, SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal Holidays. FOR FURTHER INFORMATION CONTACT: Lauralyn Remo, Air Carrier Fitness Division (X–56), Office of Aviation Analysis, Office of the Secretary, U.S. Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590, (202) 366–9721. SUPPLEMENTARY INFORMATION: Title: Aircraft Accident Liability Insurance, 14 CFR Part 205. OMB Control Number: 2106–0030. Type of Request: Renewal without change, of a previously approved collection. E:\FR\FM\09OCN1.SGM 09OCN1

Agencies

[Federal Register Volume 72, Number 194 (Tuesday, October 9, 2007)]
[Notices]
[Pages 57372-57374]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-19765]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56595; File No. SR-NYSEArca-2007-93]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change as Modified by 
Amendment No. 2 Thereto Relating to Exchange Fees and Charges

DATE: October 1, 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 September 18, 2007, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been substantially prepared by the Exchange. On September 
28, 2007, the NYSE Arca submitted Amendment No. 1 to the proposed rule 
change. On September 28, 2007, NYSE Arca withdrew Amendment No. 1 and 
filed Amendment No. 2. NYSE Arca has designated this proposal as one 
establishing or changing a due, fee, or other charge imposed by NYSE 
Arca under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) 
thereunder,\4\ which renders the proposal effective upon filing with 
the Commission. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
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    \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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NYSE Arca proposes to amend its Schedule of Fees and Charges for 
Exchange Services (``Rate Schedule''). The text of the proposed rule 
change is available at the Exchange, the Commission's Public Reference 
Room, and http://www.nysearca.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. NYSE Arca 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
    NYSE Arca states that the purpose of this filing is to amend the 
existing NYSE Arca Rate Schedule by establishing a pilot program under 
which the Exchange will cap, on a monthly basis, the Firm Facilitation 
Fee (``Pilot Program''). The Exchange also proposes to apply the Firm 
Facilitation Fee when non-OTP Firm \5\ accounts, as well as OTP Firm 
accounts, are used to facilitate customer orders. The Exchange also 
proposes adding language to the Rate Schedule, to clarify that the Firm 
Facilitation Fee is applicable to manually executed orders only. 
Although effective upon filing, the Exchange intends this fee change to 
become operative on October 1, 2007.
---------------------------------------------------------------------------

    \5\ A non-OTP Firm is a broker dealer whose proprietary trades 
clear as Firm (clearance symbol F) with the Options Clearing 
Corporation (``OCC'') and is not an NYSE Arca OTP holder.
---------------------------------------------------------------------------

    NYSE Arca presently charges OTP Holders a Firm Facilitation Fee of 
$0.15 per contract. The Firm Facilitation Fee is applicable when a 
proprietary trading account of an OTP Firm is used to facilitate an 
order for a customer of the OTP Firm. As part of this filing, the 
Exchange is now proposing to apply the Firm Facilitation Fee to any 
transaction in which a firm proprietary account, of either an OTP Firm 
or non-OTP Firm, is used to facilitate an order for a customer of that 
same firm.\6\ Presently, OTP Firms are charged the Broker Dealer & Firm 
Manual rate of $0.26 for facilitation trades they execute on behalf of 
non-OTP firms. According to the proposal, the Exchange will now apply 
the Firm Facilitation rate of $0.15 to such trades.
---------------------------------------------------------------------------

    \6\ In both instances the Firm Facilitation Fee will be applied 
to trades that have an OCC clearance account ``F'' on the trade side 
and an OCC clearance account ``C'' on the contra side of the 
transaction. Both sides of the trade will clear under the same 
clearing firm symbol.
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    The Exchange proposes to establish a pilot program, under which OTP 
Firms will be eligible for a monthly cap of $50,000 on Firm 
Facilitation Fees. The $50,000 cap will be applicable to each firm 
account that is used for facilitating orders of customers of that same 
firm. Examples of how the Firm Facilitation Fee cap will be applied are 
shown below.

Example 1

    OTP Firm A carries accounts for customers of the firm, for which 
the firm may, on occasion, facilitate certain option orders. During 
a given calendar month, the firm facilitates a number of orders for 
their customers, for which the firm incurs Firm Facilitation Fees 
totaling $60,000. Under the Pilot Program, the fee cap would have 
been met, and the Firm would be billed only $50,000.

Example 2

    OTP Firm B carries accounts of public customers, as well as 
accounts of non-OTP Firms, who themselves may wish to facilitate 
orders for their own customers. During a given calendar month, OTP 
Firm B represents facilitation orders for a non-OTP Firm for which 
it incurs Firm Facilitation Fees totaling $60,000. During the same 
month, OTP Firm B also represents facilitation orders for another 
non-OTP Firm for which they incur Facilitation Fees totaling 
$60,000. While OTP Firm B itself has

[[Page 57373]]

incurred $120,000 in total Facilitation Fees for the month, the 
entire amount is not eligible for the fee cap. Orders on behalf of 
the first non-OTP Firm, which amounted to $60,000, are capped at 
$50,000, while orders on behalf of the second non-OTP Firm, which 
amounted to $60,000, are also capped at $50,000. In this example, 
OTP Firm B has incurred Facilitation Fees totaling $120,000, but 
because the fees are eligible for the fee cap under the Pilot 
Program, OTP Firm B will be billed only $100,000.

Example 3

    OTP Firm C carries accounts of public customers, as well as 
accounts of non-OTP Firms, who themselves may wish to facilitate 
orders for their own customers. During a given calendar month, OTP 
Firm C facilitates orders for their customers, for which the firm 
incurs Firm Facilitation Fees totaling $60,000. During the same 
calendar month, OTP Firm C represents facilitation orders for a non-
OTP Firm for which it incurs Facilitation Fees totaling $60,000. 
During the same month, OTP Firm C also represents facilitation 
orders for another non-OTP Firm for which the firm incurs 
Facilitation Fees totaling $40,000. While OTP Firm C itself has 
incurred $160,000 in total Firm Facilitation Fees for the month, the 
entire amount is not eligible for the fee cap. Facilitated orders, 
executed on behalf of OTP Firm C's customer, which amounted to 
$60,000, are capped at $50,000. Facilitated orders executed on 
behalf of the first non-OTP Firm, which amounted to $60,000, are 
also capped at $50,000, but facilitated orders executed on behalf of 
the second non-OTP Firm, which amounted to $40,000, are not subject 
to the fee cap. In this example, OTP Firm C has incurred Firm 
Facilitation Fees totaling $160,000, but because of the fee cap 
under the Pilot Program, OTP Firm C will be billed only $140,000.

    OTP Firms wishing to take advantage of the fee cap must register 
for the Pilot Program with the NYSE Arca Finance Department, prior to 
the end of a calendar month, to ensure that the fee cap is applied 
correctly for billing purposes, for that month. The enrollment process 
will require that an OTP Firm supply the Exchange with information 
concerning the clearing and firm symbols of the OTP Firm's designated 
clearing account that may be used to facilitate customer orders, and/or 
the clearing and firm symbols of any non-OTP Firm customers of the OTP 
Firm that may facilitate their own customer's orders. Enrollment forms 
will be available from the NYSE Arca Finance Department. The enrollment 
information can be provided by the initiating firm, clearing firm or 
executing broker associated with these trades.
    Certain classes of options listed on the NYSE Arca have as their 
underlying security, licensed products that carry a Royalty Fee (or 
license fee), on every contract traded. Royalty Fees that are incurred 
by the Exchange are passed-on to the actual participants executing the 
trade. These passed-through fees are assessed by the issuing agency, 
and are not Exchange Transaction Fees. The Exchange will not include 
Royalty Fees, which are passed-on to trade participants in connection 
with Firm Facilitation trades, when calculating the $50,000 per month 
fee cap.
    By capping this Firm Facilitation Fee, the Exchange states that it 
hopes to garner additional order flow from market participants that are 
attracted to the competitive fee structure. The Exchange plans to offer 
this fee cap on a pilot basis until December 31, 2007. Thirty days 
prior to the conclusion of the Pilot Program, the Exchange will analyze 
the effectiveness of the fee cap and will propose, through a subsequent 
Rule 19b4 filing, to either terminate or extend the Pilot Program, or 
to make the fee cap permanent.
    Facilitation trades, governed by NYSE Arca Rule 6.47, are Crossing 
Orders, and are manually executed by Floor Brokers. Until such time 
that the Exchange's electronic trading system's automated crossing 
mechanism is functional, all Crossing Orders are executed manually. 
Therefore the Firm Facilitation Fee is only applicable to manual 
executions. The Exchange proposes at this time to add language to the 
Rate Schedule to clarify this.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \7\ in general, and furthers the 
objectives of Section 6(b)(4) of the Act \8\ in particular, in that it 
is designed to provide for the equitable allocation of reasonable dues, 
fees, and other charges among NYSE Arca members.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes that the proposed rule change will 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

    The Exchange has neither solicited nor received written comments on 
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 \9\ and Rule 19b-
4(f)(2) \10\ thereunder, because it establishes or changes a due, fee, 
or other charge imposed on members 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.\11\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \10\ 17 CFR 240.19b-4(f)(2).
    \11\ For purposes of calculating the 60-day period within which 
the Commission may summarily abrogate the proposed rule change, the 
Commission considers the period to commence on September 28, 2007, 
the date on which the Exchange filed Amendment No. 2. See 15 U.S.C. 
78s(b)(3)(C).
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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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2007-93 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-NYSEArca-2007-93. 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

[[Page 57374]]

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-NYSEArca-2007-93 and should be submitted on or before 
October 30, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
 [FR Doc. E7-19765 Filed 10-5-07; 8:45 am]
BILLING CODE 8011-01-P