Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing of a Proposed Rule Change as Modified by Amendment No. 1 Thereto Relating to Rule 1034, Minimum Increments, 62290-62291 [E7-21578]

Download as PDF 62290 Federal Register / Vol. 72, No. 212 / Friday, November 2, 2007 / Notices thirtieth day after the publication of notice thereof in the Federal Register, The Commission notes that it recently has approved a substantially similar proposal.16 This proposed rule filing does not raise any new, unique or substantive issues from those raised in the prior filing that would preclude the trading of the options on Index Multiple Units or Index Inverse Units on the Exchange. Therefore, accelerating approval of this proposal should benefit investors by creating, without undue delay, additional competition in the market for these types of options. V. Conclusion It is therefore ordered, pursuant to section 19(b)(2) of the Act,17 that the proposed rule change (SR–CBOE–2007– 119) be, and it hereby is, approved on an accelerated basis. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.18 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–21567 Filed 11–1–07; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56714; File No. SR–Phlx– 2007–70] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing of a Proposed Rule Change as Modified by Amendment No. 1 Thereto Relating to Rule 1034, Minimum Increments October 29, 2007. pwalker on PROD1PC71 with NOTICES Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on September 5, 2007, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by Phlx. On October 11, 2007, the Exchange submitted Amendment No. 1 to the proposed rule change. The Commission is publishing this notice to solicit 16 See Securities Exchange Act Release No. 56650 (October 12, 2007), 72 FR 59123 (October 18, 2007) (approving SR–Amex–2007–35). See also SR–ISE– 2007–87 (pending rule filing proposing similar amendment to options listing criteria). 17 15 U.S.C. 78s(b)(2). 18 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 15:58 Nov 01, 2007 Jkt 214001 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 Phlx proposes to amend Rule 1034, Minimum Increments, to decrease the size of the minimum quoting and trading increments applicable to the Exchange’s U.S. dollar-settled foreign currency options (‘‘FCOs’’). The text of the proposed rule change is available at Phlx, the Commission’s Public Reference Room, and https:// www.phlx.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, Phlx 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. Phlx has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of the proposed rule change is to provide additional trading opportunities by reducing the minimum increments applicable to the Exchange’s U.S. dollar-settled FCOs.3 Quoting and trading in smaller increments should enable investors to trade U.S. dollarsettled currency options with greater precision as to price. The changes would permit the trading of U.S. dollarsettled FCOs in the same minimum increments that have long been applicable (with one unrelated exception—the physical delivery British pound/Japanese yen option) to the Exchange’s physical delivery FCO contracts. Currently, all U.S. dollar-settled FCOs other than the Japanese yen have minimum increments of $.0010 3 On January 8, 2007, the Exchange began trading U.S. dollar-settled options on the British pound and the Euro on the Exchange’s electronic trading platform for options, Phlx XL. See Securities Exchange Act Release No. 54989 (December 21, 2006), 71 FR 78506 (December 29, 2006) (approving SR–Phlx–2006–34). The Exchange subsequently listed U.S. dollar-settled FCOs on the Australian dollar, the Canadian dollar, the Swiss franc and the Japanese yen. See Securities Exchange Act Release No. 56034 (July 10, 2007), 72 FR 38853 (July 16, 2007) (approving SR–Phlx–2007–34). PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 (expressed as .10) or $.0005 (expressed as .05). Minimum increments for the Japanese yen are $.000010 (also expressed as .10) or $.000005 (expressed as .05). In each case the applicable minimum increment is determined by the price at which the option is quoting. For example, all U.S. dollar-settled FCO contracts (other than options on the Japanese yen) quoting at $.0300 (expressed as 3.00) or higher have a minimum trading increment of $.0010 (expressed as .10), while the minimum increment for these U.S. dollar-settled FCOs quoting under $.0300 (expressed as 3.00) is $.0005 (expressed as .05). These minimum increments were originally established in order to accommodate trading of U.S. dollarsettled FCOs on the Phlx XL platform, which did not have penny trading capability when the rules for the U.S. dollar-settled FCOs were first drafted and filed with the Commission. The proposed amendments to Rule 1034 would set the minimum increment for U.S. dollar-settled FCOs on currencies other than the Japanese yen at $.0001 and the minimum increment for U.S. dollar-settled FCO contracts on the Japanese yen at $.000001 (in both cases expressed as .01), regardless of the price at which the option is quoting. This change would conform the minimum increments for U.S. dollarsettled FCOs to those applicable currently to the Exchange’s physical delivery FCOs. Although U.S. dollarsettled FCOs would be trading in these narrower minimum increments, they would not actually be trading in pennies (the trading increment would actually be much smaller although it would be expressed as .01) and would not be considered part of the Exchange’s pilot program currently applicable to certain equity options.4 Currently, options on currency futures trade in these smaller trading increments on the Chicago Mercantile Exchange. As a competitive matter, the 4 The pilot, which permits certain options series to be quoted and traded in increments of $0.01, began on January 26, 2007. See Securities Exchange Act Release No. 55153 (January 23, 2007), 72 FR 4553 (January 31, 2007) (SR–Phlx–2006–74). The pilot was extended through September 27, 2007. See Securities Exchange Act Release No. 56141 (July 24, 2007), 72 FR 42216 (August 1, 2007) (SR– Phlx–2007–53). The pilot program has been extended again through March 27, 2009. See Securities Exchange Act Release No. 56563 (September 27, 2007), 72 FR 56429 (October 3, 2007) (SR–Phlx–2007–62). With one exception all series in options included in the pilot trading at a price of less than $3.00 are currently quoted and traded in minimum increments of $0.01, and those with a price of $3.00 or higher are currently quoted and traded in minimum increments of $0.05. A list of all series of options in the pilot was communicated to membership via Exchange circular. E:\FR\FM\02NON1.SGM 02NON1 Federal Register / Vol. 72, No. 212 / Friday, November 2, 2007 / Notices 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: Exchange seeks the opportunity to offer investors those same, more refined increments. Also, currencies trade on the cash market in these smaller increments. Additionally, as stated above, Phlx customers have been accustomed to trading in these more refined increments in the Exchange’s physical delivery FCOs since 1982. Providing these more refined increments would permit Exchange specialists the opportunity to provide better fills (meaning less spread than the current wider minimum increments rules allow) to customers. • 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–Phlx–2007–70 on the subject line. 2. Statutory Basis Paper Comments The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,5 in general, and with Section 6(b)(5) of the Act,6 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to a free and open market and a national market system, and, in general, to protect investors and the public interest. • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change would 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 were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action pwalker on PROD1PC71 with NOTICES 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 Amex 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 Electronic Comments For the Commission, by the Division of Market Regulation, pursuant to delegated authority.7 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–21578 Filed 11–1–07; 8:45 am] BILLING CODE 8011–01–P SMALL BUSINESS ADMINISTRATION Reporting and Recordkeeping Requirements Under OMB Review Small Business Administration. Notice of Reporting Requirements Submitted for OMB Review. AGENCY: ACTION: SUMMARY: Under the provisions of the Paperwork Reduction Act (44 U.S.C. chapter 35), agencies are required to submit proposed reporting and All submissions should refer to File recordkeeping requirements to OMB for Number SR–Phlx–2007–70. This file review and approval, and to publish a number should be included on the notice in the Federal Register notifying subject line if e-mail is used. To help the the public that the agency has made Commission process and review your such a submission. comments more efficiently, please use DATES: Submit comments on or before only one method. The Commission will December 3, 2007. If you intend to post all comments on the Commission’s comment but cannot prepare comments Internet Web site (https://www.sec.gov/ promptly, please advise the OMB rules/sro.shtml). Copies of the Reviewer and the Agency Clearance submission, all subsequent Officer before the deadline. amendments, all written statements Copies: Request for clearance (OMB with respect to the proposed rule 83–1), supporting statement, and other change that are filed with the documents submitted to OMB for Commission, and all written review may be obtained from the communications relating to the Agency Clearance Officer. proposed rule change between the ADDRESSES: Address all comments Commission and any person, other than concerning this notice to: Agency those that may be withheld from the Clearance Officer, Jacqueline White, public in accordance with the Small Business Administration, 409 3rd provisions of 5 U.S.C. 552, will be Street, SW., 5th Floor, Washington, DC available for inspection and copying in 20416; and OMB Reviewer, Office of Information and Regulatory Affairs, the Commission’s Public Reference Office of Management and Budget, New Room, 100 F Street, NE., Washington, Executive Office Building, Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. DC 20503. Copies of such filing also will be FOR FURTHER INFORMATION CONTACT: Jacqueline White, Agency Clearance available for inspection and copying at Officer, (202) 205–7044. the principal office of Phlx. All comments received will be posted SUPPLEMENTARY INFORMATION: without change; the Commission does Title: Lender Advantage Initiative. not edit personal identifying No’s: N/A. information from submissions. You Frequency: On Occasion. Description of Respondents: SBA should submit only information that you wish to make available publicly. All Lenders and SBA loan applicants. Responses: 4,000. submissions should refer to File Annual Burden: 20,000. Number SR–Phlx–2007–70 and should be submitted on or before November 23, Jacqueline White, 2007. Chief, Administrative Information Branch. [FR Doc. E7–21614 Filed 11–1–07; 8:45 am] BILLING CODE 8025–01–P 5 15 U.S.C. 78f. 6 15 U.S.C. 78f(b)(5). VerDate Aug<31>2005 15:58 Nov 01, 2007 7 17 Jkt 214001 62291 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 CFR 200.30–3(a)(12). E:\FR\FM\02NON1.SGM 02NON1

Agencies

[Federal Register Volume 72, Number 212 (Friday, November 2, 2007)]
[Notices]
[Pages 62290-62291]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-21578]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56714; File No. SR-Phlx-2007-70]


Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing of a Proposed Rule Change as Modified by Amendment No. 
1 Thereto Relating to Rule 1034, Minimum Increments

October 29, 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 5, 2007, the Philadelphia Stock Exchange, Inc. (``Phlx'' 
or ``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been substantially prepared by Phlx. On 
October 11, 2007, the Exchange submitted Amendment No. 1 to the 
proposed rule change. The Commission is publishing this notice to 
solicit comments on the proposed rule change, as amended, from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Phlx proposes to amend Rule 1034, Minimum Increments, to decrease 
the size of the minimum quoting and trading increments applicable to 
the Exchange's U.S. dollar-settled foreign currency options (``FCOs'').
    The text of the proposed rule change is available at Phlx, the 
Commission's Public Reference Room, and https://www.phlx.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, Phlx 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. Phlx has prepared summaries, set forth in Sections A, B, 
and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to provide additional 
trading opportunities by reducing the minimum increments applicable to 
the Exchange's U.S. dollar-settled FCOs.\3\ Quoting and trading in 
smaller increments should enable investors to trade U.S. dollar-settled 
currency options with greater precision as to price. The changes would 
permit the trading of U.S. dollar-settled FCOs in the same minimum 
increments that have long been applicable (with one unrelated 
exception--the physical delivery British pound/Japanese yen option) to 
the Exchange's physical delivery FCO contracts.
---------------------------------------------------------------------------

    \3\ On January 8, 2007, the Exchange began trading U.S. dollar-
settled options on the British pound and the Euro on the Exchange's 
electronic trading platform for options, Phlx XL. See Securities 
Exchange Act Release No. 54989 (December 21, 2006), 71 FR 78506 
(December 29, 2006) (approving SR-Phlx-2006-34). The Exchange 
subsequently listed U.S. dollar-settled FCOs on the Australian 
dollar, the Canadian dollar, the Swiss franc and the Japanese yen. 
See Securities Exchange Act Release No. 56034 (July 10, 2007), 72 FR 
38853 (July 16, 2007) (approving SR-Phlx-2007-34).
---------------------------------------------------------------------------

    Currently, all U.S. dollar-settled FCOs other than the Japanese yen 
have minimum increments of $.0010 (expressed as .10) or $.0005 
(expressed as .05). Minimum increments for the Japanese yen are 
$.000010 (also expressed as .10) or $.000005 (expressed as .05). In 
each case the applicable minimum increment is determined by the price 
at which the option is quoting. For example, all U.S. dollar-settled 
FCO contracts (other than options on the Japanese yen) quoting at 
$.0300 (expressed as 3.00) or higher have a minimum trading increment 
of $.0010 (expressed as .10), while the minimum increment for these 
U.S. dollar-settled FCOs quoting under $.0300 (expressed as 3.00) is 
$.0005 (expressed as .05). These minimum increments were originally 
established in order to accommodate trading of U.S. dollar-settled FCOs 
on the Phlx XL platform, which did not have penny trading capability 
when the rules for the U.S. dollar-settled FCOs were first drafted and 
filed with the Commission.
    The proposed amendments to Rule 1034 would set the minimum 
increment for U.S. dollar-settled FCOs on currencies other than the 
Japanese yen at $.0001 and the minimum increment for U.S. dollar-
settled FCO contracts on the Japanese yen at $.000001 (in both cases 
expressed as .01), regardless of the price at which the option is 
quoting. This change would conform the minimum increments for U.S. 
dollar-settled FCOs to those applicable currently to the Exchange's 
physical delivery FCOs. Although U.S. dollar-settled FCOs would be 
trading in these narrower minimum increments, they would not actually 
be trading in pennies (the trading increment would actually be much 
smaller although it would be expressed as .01) and would not be 
considered part of the Exchange's pilot program currently applicable to 
certain equity options.\4\
---------------------------------------------------------------------------

    \4\ The pilot, which permits certain options series to be quoted 
and traded in increments of $0.01, began on January 26, 2007. See 
Securities Exchange Act Release No. 55153 (January 23, 2007), 72 FR 
4553 (January 31, 2007) (SR-Phlx-2006-74). The pilot was extended 
through September 27, 2007. See Securities Exchange Act Release No. 
56141 (July 24, 2007), 72 FR 42216 (August 1, 2007) (SR-Phlx-2007-
53). The pilot program has been extended again through March 27, 
2009. See Securities Exchange Act Release No. 56563 (September 27, 
2007), 72 FR 56429 (October 3, 2007) (SR-Phlx-2007-62). With one 
exception all series in options included in the pilot trading at a 
price of less than $3.00 are currently quoted and traded in minimum 
increments of $0.01, and those with a price of $3.00 or higher are 
currently quoted and traded in minimum increments of $0.05. A list 
of all series of options in the pilot was communicated to membership 
via Exchange circular.
---------------------------------------------------------------------------

    Currently, options on currency futures trade in these smaller 
trading increments on the Chicago Mercantile Exchange. As a competitive 
matter, the

[[Page 62291]]

Exchange seeks the opportunity to offer investors those same, more 
refined increments. Also, currencies trade on the cash market in these 
smaller increments. Additionally, as stated above, Phlx customers have 
been accustomed to trading in these more refined increments in the 
Exchange's physical delivery FCOs since 1982. Providing these more 
refined increments would permit Exchange specialists the opportunity to 
provide better fills (meaning less spread than the current wider 
minimum increments rules allow) to customers.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act,\5\ in general, and with 
Section 6(b)(5) of the Act,\6\ in particular, in that it is designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade, to remove impediments to a free and 
open market and a national market system, and, in general, to protect 
investors and the public interest.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f.
    \6\ 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 would 
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 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 Amex consents, the Commission will:
    A. By order approve such proposed rule change, or
    B. Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

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-Phlx-2007-70 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-Phlx-2007-70. 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 Phlx. 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-Phlx-2007-70 and should be 
submitted on or before November 23, 2007.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-21578 Filed 11-1-07; 8:45 am]
BILLING CODE 8011-01-P
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