Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Approval of Proposed Rule Change To Reduce Certain Order Exposure Times From Three Seconds to One Second, 39747-39748 [E8-15628]
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Federal Register / Vol. 73, No. 133 / Thursday, July 10, 2008 / Notices
Act,6 in particular, in that it is designed
to provide for the equitable allocation of
reasonable dues, fees, and other charges
among its members and issuers and
other persons using its facilities. The
proposed rule change will preserve the
status quo of the pilot program without
interruption as the Commission further
reviews the area of Linkage fees.
IV. Solicitation of Comments
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Electronic 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:
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
• 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
No. SR–BSE–2008–35 on the subject
line.
Paper Comments
The Exchange has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
jlentini on PROD1PC65 with NOTICES
This proposed rule change is filed
pursuant to paragraph (A) of section
19(b)(3) of the Exchange Act 7 and Rule
19b–4(f)(6) thereunder.8 This proposed
rule change does not significantly affect
the protection of investors or the public
interest, does not impose any significant
burden on competition, and, by its
terms, does not become operative for 30
days after the date of the filing, or such
shorter time as the Commission may
designate if consistent with the
protection of investors and the public
interest, provided that the selfregulatory organization has given the
Commission written notice of its intent
to file the proposed rule change, along
with a brief description and text of the
proposed rule change, at least five
business days prior to the date of filing
of the proposed rule change, or such
shorter time as designated by the
Commission.9
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
the rule change if it appears to the
Commission that the action is necessary
or appropriate in the public interest, for
the protection of investors, or would
otherwise further the purposes of the
Exchange Act.
6 15
U.S.C. 78f(b)(4).
U.S.C. 78s(b)(3)(A).
8 17 CFR 240.19b–4(f)(6).
9 The Exchange has satisfied this pre-filing
requirement.
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, Station Place, 100 F Street,
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BSE–2008–35. 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 also will be available for
inspection and copying at the principal
office of BSE. 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–BSE–
2008–35 and should be submitted on or
before July 31, 2008.
7 15
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16:58 Jul 09, 2008
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For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–15625 Filed 7–9–08; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58088; File No. SR–CBOE–
2008–16]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Order Granting Approval
of Proposed Rule Change To Reduce
Certain Order Exposure Times From
Three Seconds to One Second
July 2, 2008.
I. Introduction
On May 16, 2008, the Chicago Board
Options Exchange, Incorporated
(‘‘CBOE’’ or ‘‘Exchange’’), filed with the
Securities and Exchange Commission
(‘‘Commission’’) pursuant to section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
reduce certain order exposure times
from three seconds to one second. The
proposed rule change was published for
comment in the Federal Register on
May 30, 2008.3 The Commission
received no comments on the proposal.
This order approves the proposed rule
change.
II. Description of the Proposal
The Exchange proposes to reduce the
order handling and exposure periods
contained in Rules 6.45A, Priority and
Allocation of Equity Option Trades on
the CBOE Hybrid System, 6.45B, Priority
and Allocation of Trades in Index
Options and Options on ETFs on the
CBOE Hybrid System, 6.74A,
Automated Improvement Mechanism
(‘‘AIM’’), and 6.74B, Solicitation
Auction Mechanism, from three seconds
to one second.
Rules 6.45A and 6.45B provide that
an order entry firm may not execute an
order it represents as agent with a
facilitation or solicited order (referred to
herein as ‘‘crossing orders’’) using the
Hybrid Trading System (‘‘Hybrid’’)
unless it first complies with the threesecond exposure requirement.
Specifically, order entry firms may not
execute a facilitation cross unless: (i)
10 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 57849
(May 22, 2008), 73 FR 31167 (May 30, 2008).
1 15
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39747
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39748
Federal Register / Vol. 73, No. 133 / Thursday, July 10, 2008 / Notices
jlentini on PROD1PC65 with NOTICES
The agency order is first exposed on
Hybrid for at least three seconds; (ii) the
order entry firm has been bidding or
offering for at least three seconds prior
to receiving the agency order that is
executable against such bid or offer; or
(iii) the order entry firm proceeds in
accordance with the floor-based open
outcry crossing rules contained in CBOE
Rule 6.74, Crossing Orders. Similarly,
order entry firms may not execute an
order they represent as agent against
orders solicited from members and nonmember broker-dealers unless the
agency order is first exposed on Hybrid
for at least three seconds. During this
three-second exposure period for
crossing orders, other members may
enter orders to trade against the exposed
order. CBOE proposes to reduce these
exposure periods to one second.
Rule 6.74A provides that orders
entered into AIM must be exposed for
a random time period that is not less
than three seconds and not more than
five seconds, to provide an opportunity
for additional trading interest to be
entered before the orders are
automatically executed. Rule 6.74B
provides that orders entered into the
Solicitation Auction Mechanism (the
‘‘SAM Auction’’) must be exposed for a
three second period, also to provide an
opportunity for additional trading
interest to be entered before the orders
are automatically executed. CBOE
proposes to reduce the exposure period
for AIM and the exposure period for the
SAM Auction to one second.
III. Discussion and Commission
Findings
The Commission has carefully
reviewed the proposed rule change and
finds that it is consistent with the
requirements of the Act and the rules
and regulations thereunder applicable to
a national securities exchange.4 In
particular, the Commission finds that
the proposed rule change is consistent
with section 6(b)(5) of the Act,5 which,
among other things, requires that the
rules of a national securities exchange
be designed to promote just and
equitable principles of trade, to foster
cooperation and coordination with
persons engaged in regulating
transactions in securities, to remove
impediments to and perfect the
mechanism of a free and open market
and a national market system and, in
general, to protect investors and the
public interest. The Commission also
finds that the proposed rule change is
consistent with section 6(b)(8) of the
Act,6 which requires that the rules of an
exchange not impose any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act.
The Commission believes that, in the
electronic environment of Hybrid,
reducing each of the exposure periods
from three seconds to one second could
facilitate the prompt execution of
orders, while continuing to provide
participants in Hybrid with an
opportunity to compete for exposed bids
and offers. According to the Exchange,
numerous CBOE market participants
have the capability to and do opt to
respond within a one-second exposure
period on its Hybrid trading platform.
Specifically, the Exchange noted that
the exposure and allocation timers for
the Exchange’s Hybrid Agency Liaison
(‘‘HAL’’) mechanism, which employs
the same type of mechanical messaging
as the AIM and SAM Auction
mechanisms, are currently both set at
0.300 seconds and numerous market
participants can and do opt to respond
to HAL exposure messages within this
time frame. The Exchange also noted
that market participants receive
mechanically messaged information
about book updates, and are able to and
do opt to automatically submit orders
and quotes in response to those book
updates on the Hybrid trading system,
in substantially the same manner as
they would respond to a HAL message.
Accordingly, the Commission believes
that it is consistent with the Act for
these order exposure times to be
reduced from three seconds to one
second.
IV. Conclusion
It is therefore ordered, pursuant to
section 19(b)(2) of the Act,7 that the
proposed rule change (SR–CBOE–2008–
16) be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.8
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–15628 Filed 7–9–08; 8:45 am]
BILLING CODE 8010–01–P
4 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
5 15 U.S.C. 78f(b)(5).
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16:58 Jul 09, 2008
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58076; File No. SR–CBOE–
2008–66]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Related to the
Appointment Cost of RVX and VXN
Options
July 1, 2008.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 26,
2008, the Chicago Board Options
Exchange, Incorporated (the ‘‘Exchange’’
or ‘‘CBOE’’) filed with the Securities
and Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
substantially prepared by the Exchange.
The Exchange filed the proposal as a
‘‘non-controversial’’ proposed rule
change pursuant to Section
19(b)(3)(A)(iii) of the Act 3 and Rule
19b–4(f)(6) thereunder.4 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
CBOE rules relating to the appointment
cost for options on the CBOE Russell
2000 Volatility Index (RVX) and options
on the CBOE Nasdaq 100 Volatility
Index (VXN). The text of the proposed
rule change is available on the
Exchange’s Web site (https://
www.cboe.org/Legal), at the Exchange’s
Office of the Secretary and at the
Commission’s Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of
and basis for the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of 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,
1 15
6 15
U.S.C. 78f(b)(8).
7 15 U.S.C. 78s(b)(2).
8 17 CFR 200.30–3(a)(12).
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Fmt 4703
Sfmt 4703
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
2 17
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]]>Agencies
[Federal Register Volume 73, Number 133 (Thursday, July 10, 2008)]
[Notices]
[Pages 39747-39748]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-15628]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58088; File No. SR-CBOE-2008-16]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Order Granting Approval of Proposed Rule Change To Reduce
Certain Order Exposure Times From Three Seconds to One Second
July 2, 2008.
I. Introduction
On May 16, 2008, the Chicago Board Options Exchange, Incorporated
(``CBOE'' or ``Exchange''), filed with the Securities and Exchange
Commission (``Commission'') pursuant to section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to reduce certain order exposure
times from three seconds to one second. The proposed rule change was
published for comment in the Federal Register on May 30, 2008.\3\ The
Commission received no comments on the proposal. This order approves
the proposed rule change.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Securities Exchange Act Release No. 57849 (May 22,
2008), 73 FR 31167 (May 30, 2008).
---------------------------------------------------------------------------
II. Description of the Proposal
The Exchange proposes to reduce the order handling and exposure
periods contained in Rules 6.45A, Priority and Allocation of Equity
Option Trades on the CBOE Hybrid System, 6.45B, Priority and Allocation
of Trades in Index Options and Options on ETFs on the CBOE Hybrid
System, 6.74A, Automated Improvement Mechanism (``AIM''), and 6.74B,
Solicitation Auction Mechanism, from three seconds to one second.
Rules 6.45A and 6.45B provide that an order entry firm may not
execute an order it represents as agent with a facilitation or
solicited order (referred to herein as ``crossing orders'') using the
Hybrid Trading System (``Hybrid'') unless it first complies with the
three-second exposure requirement. Specifically, order entry firms may
not execute a facilitation cross unless: (i)
[[Page 39748]]
The agency order is first exposed on Hybrid for at least three seconds;
(ii) the order entry firm has been bidding or offering for at least
three seconds prior to receiving the agency order that is executable
against such bid or offer; or (iii) the order entry firm proceeds in
accordance with the floor-based open outcry crossing rules contained in
CBOE Rule 6.74, Crossing Orders. Similarly, order entry firms may not
execute an order they represent as agent against orders solicited from
members and non-member broker-dealers unless the agency order is first
exposed on Hybrid for at least three seconds. During this three-second
exposure period for crossing orders, other members may enter orders to
trade against the exposed order. CBOE proposes to reduce these exposure
periods to one second.
Rule 6.74A provides that orders entered into AIM must be exposed
for a random time period that is not less than three seconds and not
more than five seconds, to provide an opportunity for additional
trading interest to be entered before the orders are automatically
executed. Rule 6.74B provides that orders entered into the Solicitation
Auction Mechanism (the ``SAM Auction'') must be exposed for a three
second period, also to provide an opportunity for additional trading
interest to be entered before the orders are automatically executed.
CBOE proposes to reduce the exposure period for AIM and the exposure
period for the SAM Auction to one second.
III. Discussion and Commission Findings
The Commission has carefully reviewed the proposed rule change and
finds that it is consistent with the requirements of the Act and the
rules and regulations thereunder applicable to a national securities
exchange.\4\ In particular, the Commission finds that the proposed rule
change is consistent with section 6(b)(5) of the Act,\5\ which, among
other things, requires that the rules of a national securities exchange
be designed to promote just and equitable principles of trade, to
foster cooperation and coordination with persons engaged in regulating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system and,
in general, to protect investors and the public interest. The
Commission also finds that the proposed rule change is consistent with
section 6(b)(8) of the Act,\6\ which requires that the rules of an
exchange not impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\4\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
\5\ 15 U.S.C. 78f(b)(5).
\6\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------
The Commission believes that, in the electronic environment of
Hybrid, reducing each of the exposure periods from three seconds to one
second could facilitate the prompt execution of orders, while
continuing to provide participants in Hybrid with an opportunity to
compete for exposed bids and offers. According to the Exchange,
numerous CBOE market participants have the capability to and do opt to
respond within a one-second exposure period on its Hybrid trading
platform. Specifically, the Exchange noted that the exposure and
allocation timers for the Exchange's Hybrid Agency Liaison (``HAL'')
mechanism, which employs the same type of mechanical messaging as the
AIM and SAM Auction mechanisms, are currently both set at 0.300 seconds
and numerous market participants can and do opt to respond to HAL
exposure messages within this time frame. The Exchange also noted that
market participants receive mechanically messaged information about
book updates, and are able to and do opt to automatically submit orders
and quotes in response to those book updates on the Hybrid trading
system, in substantially the same manner as they would respond to a HAL
message. Accordingly, the Commission believes that it is consistent
with the Act for these order exposure times to be reduced from three
seconds to one second.
IV. Conclusion
It is therefore ordered, pursuant to section 19(b)(2) of the
Act,\7\ that the proposed rule change (SR-CBOE-2008-16) be, and hereby
is, approved.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
---------------------------------------------------------------------------
\8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-15628 Filed 7-9-08; 8:45 am]
BILLING CODE 8010-01-P
