Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change, and Amendment No. 1 Thereto, Relating to Floor Broker Charge and Specialist Unit Credit in Connection With Linkage P/A Orders, 19128-19129 [E8-7312]
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19128
Federal Register / Vol. 73, No. 68 / Tuesday, April 8, 2008 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–7309 Filed 4–7–08; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–57608; File No. SR–Phlx–
2008–22]
Self-Regulatory Organizations;
Philadelphia Stock Exchange, Inc.;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change, and Amendment No. 1
Thereto, Relating to Floor Broker
Charge and Specialist Unit Credit in
Connection With Linkage P/A Orders
April 2, 2008.
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 March 12,
2008, 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 the Exchange.
On April 1, 2008, Phlx submitted
Amendment No. 1 to the proposed rule
change. The Exchange filed the
proposed rule change pursuant to
Section 19(b)(3)(A) 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
Phlx proposes to charge floor brokers
an amount equal to the transaction fee(s)
assessed on options specialist units by
another exchange in connection with
customer orders that are delivered to the
limit order book via the Exchange’s
Options Floor Broker Management
System (‘‘FBMS’’)5 and subsequently
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).
4 17 CFR 240.19b–4(f)(2).
5 FBMS is designed to enable floor brokers and/
or their employees to enter, route, and report
transactions stemming from options orders received
on the Exchange. FBMS also is designed to establish
an electronic audit trail for options orders
represented and executed by floor brokers on the
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Jkt 214001
executed via the Intermarket Option
Linkage (‘‘Linkage’’) 6 as a Principal
Acting as Agent (‘‘P/A’’) order.7 The
Exchange also proposes to provide to
options specialist units a credit in an
amount equal to the transaction fee(s)
assessed on them by another exchange
in connection with executing customer
orders that are delivered to the limit
order book via FBMS and executed via
Linkage as P/A orders.
While changes to the fee schedule
pursuant to this proposal are effective
upon filing, the Exchange has
designated the changes to be in effect for
transactions settling on or after March
17, 2008, through July 31, 2008.8 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, the
Exchange included statements
concerning the purpose of, and basis for,
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant aspects of such
statements.
Exchange such that the audit trail provides an
accurate, time-sequenced record of electronic and
other orders, quotations, and transactions on the
Exchange, beginning with the receipt of an order by
the Exchange, and further documenting the life of
the order through the process of execution, partial
execution, or cancellation of that order. See
Exchange Rule 1080, Commentary .06.
6 Linkage is governed by the Options Linkage
Authority under the conditions set forth under the
Plan for the Purpose of Creating and Operating an
Intermarket Option Linkage (‘‘Linkage Plan’’). The
registered U.S. options markets are linked together
on a real-time basis through a network capable of
transporting orders and messages to and from each
market.
7 A P/A order is an order for the principal account
of a specialist (or equivalent entity on another
participant exchange that is authorized to represent
public customer orders), reflecting the terms of a
related unexecuted public customer order for which
the specialist is acting as agent. See Linkage Plan
Section 2(16)(a) and Exchange Rule 1083.
8This proposal is scheduled to be in effect for the
same time period as fees for Linkage Principal and
P/A orders. See Securities Exchange Act Release
No. 56166 (July 30, 2007), 72 FR 43312 (August 3,
2007) (SR–Phlx–2007–52).
PO 00000
Frm 00082
Fmt 4703
Sfmt 4703
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to charge
floor brokers an amount equal to the
transaction fee(s) 9 assessed on options
specialist units by another exchange in
connection with customer orders that
are delivered to the limit order book via
FBMS and executed via Linkage as P/A
orders. The Exchange also proposes to
provide to options specialist units a
credit in an amount equal to the
transaction fee(s) assessed on them by
another exchange in connection with
executing customer orders that are
delivered to the limit order book via
FBMS and executed via Linkage as P/A
orders.
The purpose of this proposal is to
assist specialist units in offsetting the
costs they incur in routing orders to
other exchanges in order to obtain the
National Best Bid or Offer (‘‘NBBO’’). By
giving a corresponding credit to
specialist units who bear the direct costs
of routing these orders, the Exchange
believes that the undue financial burden
of multiple transaction charges imposed
on Exchange specialist units in
connection with orders that are
executed at an away market will be
lessened. Additionally, the purpose of
assessing a fee on floor brokers who
send customer orders that are delivered
to the limit order book via FBMS and
executed via Linkage as P/A orders is to
more equitably assess the applicable
transaction fee(s) on the member
originally entering the order to be
executed. Floor brokers may choose to
route these orders through other systems
and not place such orders on the limit
order book.
The Exchange represents that when
members do not want an order to be
routed away through Linkage (thereby
avoiding the transaction fees discussed
above), that member may mark the order
with an Immediate or Cancel (‘‘IOC’’)
designation. IOC orders are not routed
to other market centers. Instead, if they
cannot be executed on Phlx, they are
cancelled.
While changes to the fee schedule
pursuant to this proposal were effective
upon filing, the Exchange designated
the changes operative for trades settling
9 Transaction fees do not include fees assessed by
The Options Clearing Corporation or the Covered
Sales Fee. The Covered Sale Fee is assessed on Phlx
members in connection with the sales of securities
on the Exchange with respect to which Phlx is
obligated to pay a fee to the Commission under
Section 31 of the Act. Other exchanges refer to this
fee by different names.
E:\FR\FM\08APN1.SGM
08APN1
Federal Register / Vol. 73, No. 68 / Tuesday, April 8, 2008 / Notices
IV. Solicitation of Comments
on or after March 17, 2008 through
July 31, 2008.10
2. Statutory Basis
The Exchange believes that its
proposal to amend its schedule of fees
is consistent with Section 6(b) of the
Act,11 in general, and furthers the
objectives of Section 6(b)(4) of the Act,12
in particular, in that it is designed to
provide for the equitable allocation of
reasonable dues, fees, and other charges
among Exchange members. The
Exchange believes that assessing a fee
on floor brokers and giving a
corresponding credit to specialist units
as described herein allows for the
transaction fee(s) to be assessed on the
member who submits the order and for
the credit to be given to the specialist
unit that routed the order to another
exchange in order to obtain the NBBO.
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
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change is
effective upon filing pursuant to Section
19(b)(3)(A)(ii) 13 of the Act and Rule
19b–4(f)(2) 14 thereunder, because it
establishes or changes a due, fee, or
other charge applicable only to a
member imposed by the Exchange. At
any time within 60 days of the filing of
the 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.15
10 See
supra note 8.
U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(4).
13 15 U.S.C. 78s(b)(3)(A)(ii).
14 17 CFR 240.19b–4(f)(2).
15 For purposes of calcualting the 60-day period
within which the Commission may summarily
abrogate the proposed rule change under Section
19(b)(3)(C) of the Act, the Commission considers
that period to commence on April 1, 2008, the date
the Exchange filed Amendment No. 1 to the
proposed rule change. See 15 U.S.C. 78s(b)(3)(C).
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Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
19129
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8–7312 Filed 4–7–08; 8:45 am]
BILLING CODE 8011–01–P
Electronic Comments
SMALL BUSINESS ADMINISTRATION
• 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–2008–22 on the
subject line.
Notice of Action Subject to
Intergovernmental Review Under
Executive Order 12372
Paper Comments
U.S. Small Business
Administration.
ACTION: Notice of Action Subject to
Intergovernmental Review Under
Executive Order 12372.
AGENCY:
SUMMARY: The Small Business
Administration (SBA) is notifying the
public that it intends to grant the
pending applications of 22 existing
Small Business Development Centers
(SBDCs) for refunding on October 1,
2008, subject to the availability of funds.
All submissions should refer to File
Nine states do not participate in the EO
Number SR–Phlx–2008–22. This file
12372 process; therefore, their addresses
number should be included on the
are not included. A short description of
subject line if e-mail is used. To help the the SBDC program follows in the
Commission process and review your
supplementary information below.
comments more efficiently, please use
The SBA is publishing this notice at
only one method. The Commission will least 90 days before the expected
post all comments on the Commission’s refunding date. The SBDCs and their
Internet Web site (https://www.sec.gov/
mailing addresses are listed below in
rules/sro/shtml). Copies of the
the address section. A copy of this
submission, all subsequent
notice also is being furnished to the
amendments, all written statements
respective State single points of contact
with respect to the proposed rule
designated under the Executive Order.
Each SBDC application must be
change that are filed with the
consistent with any area-wide small
Commission, and all written
business assistance plan adopted by a
communications relating to the
State-authorized agency.
proposed rule change between the
Commission and any person, other than DATES: A State single point of contact
and other interested State or local
those that may be withheld from the
entities may submit written comments
public in accordance with the
regarding an SBDC refunding within 30
provisions of 5 U.S.C. 552, will be
days from the date of publication of this
available for inspection and copying in
notice to the SBDC.
the Commission’s Public Reference
Room, on official business days between ADDRESSES:
the hours of 10 a.m. and 3 p.m. Copies
Addresses of Relevant SBDC State
of such filing will also be available for
Directors
inspection and copying at the principal
Mr. Al Salgado, Regional Director,
office of the Exchange. All comments
Univ. of Texas at San Antonio, 501 West
received will be posted without change;
Durango Blvd., San Antonio, TX 78207,
the Commission does not edit personal
(210) 458–2450.
identifying information from
Mr. Clinton Tymes, State Director,
submissions. You should submit only
University of Delaware, One Innovation
information that you wish to make
Way, Suite 301, Newark, DE 19711,
available publicly. All submissions
(302) 831–2747.
should refer to File No. SR–Phlx–2008–
Ms. M.E. Gamble, State Director, West
22 and should be submitted on or before Virginia Development Office, Capitol
April 29, 2008.
Complex, Building 6, Room 652,
Charleston, WV 25301, (304) 558–2960.
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
PO 00000
16 17
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CFR 200.30–3(a)(12).
08APN1
]]>Agencies
[Federal Register Volume 73, Number 68 (Tuesday, April 8, 2008)]
[Notices]
[Pages 19128-19129]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-7312]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-57608; File No. SR-Phlx-2008-22]
Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change,
and Amendment No. 1 Thereto, Relating to Floor Broker Charge and
Specialist Unit Credit in Connection With Linkage P/A Orders
April 2, 2008.
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 March 12, 2008, 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 the
Exchange. On April 1, 2008, Phlx submitted Amendment No. 1 to the
proposed rule change. The Exchange filed the proposed rule change
pursuant to Section 19(b)(3)(A) 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Phlx proposes to charge floor brokers an amount equal to the
transaction fee(s) assessed on options specialist units by another
exchange in connection with customer orders that are delivered to the
limit order book via the Exchange's Options Floor Broker Management
System (``FBMS'')\5\ and subsequently executed via the Intermarket
Option Linkage (``Linkage'') \6\ as a Principal Acting as Agent (``P/
A'') order.\7\ The Exchange also proposes to provide to options
specialist units a credit in an amount equal to the transaction fee(s)
assessed on them by another exchange in connection with executing
customer orders that are delivered to the limit order book via FBMS and
executed via Linkage as P/A orders.
---------------------------------------------------------------------------
\5\ FBMS is designed to enable floor brokers and/or their
employees to enter, route, and report transactions stemming from
options orders received on the Exchange. FBMS also is designed to
establish an electronic audit trail for options orders represented
and executed by floor brokers on the Exchange such that the audit
trail provides an accurate, time-sequenced record of electronic and
other orders, quotations, and transactions on the Exchange,
beginning with the receipt of an order by the Exchange, and further
documenting the life of the order through the process of execution,
partial execution, or cancellation of that order. See Exchange Rule
1080, Commentary .06.
\6\ Linkage is governed by the Options Linkage Authority under
the conditions set forth under the Plan for the Purpose of Creating
and Operating an Intermarket Option Linkage (``Linkage Plan''). The
registered U.S. options markets are linked together on a real-time
basis through a network capable of transporting orders and messages
to and from each market.
\7\ A P/A order is an order for the principal account of a
specialist (or equivalent entity on another participant exchange
that is authorized to represent public customer orders), reflecting
the terms of a related unexecuted public customer order for which
the specialist is acting as agent. See Linkage Plan Section 2(16)(a)
and Exchange Rule 1083.
---------------------------------------------------------------------------
While changes to the fee schedule pursuant to this proposal are
effective upon filing, the Exchange has designated the changes to be in
effect for transactions settling on or after March 17, 2008, through
July 31, 2008.\8\ The text of the proposed rule change is available at
Phlx, the Commission's Public Reference Room, and https://www.phlx.com.
---------------------------------------------------------------------------
\8\This proposal is scheduled to be in effect for the same time
period as fees for Linkage Principal and P/A orders. See Securities
Exchange Act Release No. 56166 (July 30, 2007), 72 FR 43312 (August
3, 2007) (SR-Phlx-2007-52).
---------------------------------------------------------------------------
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to charge floor brokers an amount equal to
the transaction fee(s) \9\ assessed on options specialist units by
another exchange in connection with customer orders that are delivered
to the limit order book via FBMS and executed via Linkage as P/A
orders. The Exchange also proposes to provide to options specialist
units a credit in an amount equal to the transaction fee(s) assessed on
them by another exchange in connection with executing customer orders
that are delivered to the limit order book via FBMS and executed via
Linkage as P/A orders.
---------------------------------------------------------------------------
\9\ Transaction fees do not include fees assessed by The Options
Clearing Corporation or the Covered Sales Fee. The Covered Sale Fee
is assessed on Phlx members in connection with the sales of
securities on the Exchange with respect to which Phlx is obligated
to pay a fee to the Commission under Section 31 of the Act. Other
exchanges refer to this fee by different names.
---------------------------------------------------------------------------
The purpose of this proposal is to assist specialist units in
offsetting the costs they incur in routing orders to other exchanges in
order to obtain the National Best Bid or Offer (``NBBO''). By giving a
corresponding credit to specialist units who bear the direct costs of
routing these orders, the Exchange believes that the undue financial
burden of multiple transaction charges imposed on Exchange specialist
units in connection with orders that are executed at an away market
will be lessened. Additionally, the purpose of assessing a fee on floor
brokers who send customer orders that are delivered to the limit order
book via FBMS and executed via Linkage as P/A orders is to more
equitably assess the applicable transaction fee(s) on the member
originally entering the order to be executed. Floor brokers may choose
to route these orders through other systems and not place such orders
on the limit order book.
The Exchange represents that when members do not want an order to
be routed away through Linkage (thereby avoiding the transaction fees
discussed above), that member may mark the order with an Immediate or
Cancel (``IOC'') designation. IOC orders are not routed to other market
centers. Instead, if they cannot be executed on Phlx, they are
cancelled.
While changes to the fee schedule pursuant to this proposal were
effective upon filing, the Exchange designated the changes operative
for trades settling
[[Page 19129]]
on or after March 17, 2008 through July 31, 2008.\10\
---------------------------------------------------------------------------
\10\ See supra note 8.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that its proposal to amend its schedule of
fees is consistent with Section 6(b) of the Act,\11\ in general, and
furthers the objectives of Section 6(b)(4) of the Act,\12\ in
particular, in that it is designed to provide for the equitable
allocation of reasonable dues, fees, and other charges among Exchange
members. The Exchange believes that assessing a fee on floor brokers
and giving a corresponding credit to specialist units as described
herein allows for the transaction fee(s) to be assessed on the member
who submits the order and for the credit to be given to the specialist
unit that routed the order to another exchange in order to obtain the
NBBO.
---------------------------------------------------------------------------
\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
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
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change is effective upon filing
pursuant to Section 19(b)(3)(A)(ii) \13\ of the Act and Rule 19b-
4(f)(2) \14\ thereunder, because it establishes or changes a due, fee,
or other charge applicable only to a member imposed by the Exchange. At
any time within 60 days of the filing of the 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.\15\
---------------------------------------------------------------------------
\13\ 15 U.S.C. 78s(b)(3)(A)(ii).
\14\ 17 CFR 240.19b-4(f)(2).
\15\ For purposes of calcualting the 60-day period within which
the Commission may summarily abrogate the proposed rule change under
Section 19(b)(3)(C) of the Act, the Commission considers that period
to commence on April 1, 2008, the date the Exchange filed Amendment
No. 1 to the proposed rule change. See 15 U.S.C. 78s(b)(3)(C).
---------------------------------------------------------------------------
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change, as amended, 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-2008-22 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-2008-22. 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, on official business
days between the hours of 10 a.m. and 3 p.m. Copies of such filing will
also 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 No. SR-Phlx-
2008-22 and should be submitted on or before April 29, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
---------------------------------------------------------------------------
\16\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-7312 Filed 4-7-08; 8:45 am]
BILLING CODE 8011-01-P
