Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Market-Maker Transaction Fees, 46955-46956 [E8-18602]

Download as PDF sroberts on PROD1PC70 with NOTICES Federal Register / Vol. 73, No. 156 / Tuesday, August 12, 2008 / Notices become party to the BSX Operating Agreement pursuant to the revised Section 8.2(f). The Commission finds these changes to the BSX Operating Agreement consistent with the Act. Section 8.2(f) of the BSX Operating Agreement is designed to minimize the potential that a person could improperly interfere with or restrict the ability of the Commission and BSE to effectively carry out their regulatory oversight responsibilities under the Act. The clarifications proposed by BSE do not hinder the intent of Section 8.2(f), because the Commission believes that a person without voting power in the equity securities of a BSX Member, or a person with no direct or indirect interest in a BSX Member, could not interfere with or restrict the Commission’s or the BSE’s ability to carry out its regulatory responsibilities. In Amendment No. 1 to the BOX Transfer Proposal, BSE proposes to amend Section 8.4(g) of the BOX LLC Agreement. Section 8.4(g) currently requires that any person who, alone or together with any affiliate of such person, has 25 percent or greater interest in a BOX Member who, alone or together with any affiliate of such BOX Member, holds 20 percent or greater interest in BOX become party to, and abide by all the provisions of, the BOX LLC Agreement. In Amendment No. 1, BSE proposes to clarify that for the Section 8.4(g) requirement to apply, a person, alone or together with any affiliate of such person, must have direct or indirect ownership of 25 percent or more of the total voting power of all equity securities of a BOX Member, other than voting rights solely with respect to matters affecting the rights, preferences, or privileges of a particular class of equity securities. Notwithstanding the foregoing, BSE proposes to clarify that a person with zero percent direct or indirect interest in a BOX Member would not be required to become party to the BOX LLC Agreement pursuant to the revised Section 8.4(g). The Commission finds these changes to the BOX LLC Agreement consistent with the Act. Section 8.4(g) of the BOX LLC Agreement is designed to minimize the potential that a person could improperly interfere with or restrict the ability of the Commission and BSE to effectively carry out their regulatory oversight responsibilities under the Act. The clarifications proposed by BSE do not hinder the intent of Section 8.4(g) because the Commission believes that a person without voting power in the equity securities of a BOX Member, or a person with no direct or indirect VerDate Aug<31>2005 16:24 Aug 11, 2008 Jkt 214001 interest in a BOX Member, could not interfere with or restrict the Commission’s or the BSE’s ability to carry out its regulatory responsibilities. For the reasons described above, the Commission finds good cause for approving each of the following on an accelerated basis, pursuant to Section 19(b)(2) of the Act: (1) The BSE Governance Proposal, as modified by Amendment No. 1; (2) the BSECC Governance Proposal, as modified by Amendment No. 1; and (3) the BOX transfer Proposal, as modified by Amendment No. 1. V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,270 that the BSE Interim Certificate Proposal (SR– BSE–2008–02), as modified by Amendment No. 1, be, and hereby is, approved; that the BSE Governance Proposal (SR–BSE–2008–23), as modified by Amendment No.1, be, and hereby is, approved on an accelerated basis; that the BOX Transfer Proposal (SR–BSE–2008–25), as modified by Amendment No. 1, be, and hereby is, approved on an accelerated basis; and that the BSECC Governance Proposal (SR–BSECC–2008–01), as modified by Amendment No.1 be, and hereby is approved on an accelerated basis. By the Commission. Florence E. Harmon, Acting Secretary. [FR Doc. E8–18577 Filed 8–11–08; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58321; File No. SR–CBOE– 2008–78] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Market-Maker Transaction Fees August 6, 2008. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 1, notice is hereby given that on July 25, 2008, the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ 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 prepared by CBOE. The Commission is 270 15 1 15 PO 00000 U.S.C. 78s(b)(2). U.S.C. 78s(b)(1). Frm 00087 Fmt 4703 Sfmt 4703 46955 publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of the Substance of the Proposed Rule Change CBOE proposes to amend its Fees Schedule relating to market-maker transaction fees. The text of the proposed rule change is available on the Exchange’s Web site (http:// www.cboe.org/legal), at the Exchange’s Office of the Secretary and at the Commission. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CBOE 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. CBOE 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 Under the Exchange’s ‘‘Liquidity Provider Sliding Scale’’ program, the Exchange reduces Liquidity Provider (CBOE Market-Maker, DPM, e-DPM and LMM) per contract transaction fees based on the number of contracts a Liquidity Provider trades in a month. The sliding scale applies to Liquidity Provider transaction fees in all products.2 A Liquidity Provider’s standard $.20 per contract transaction fee is reduced if the Liquidity Provider reaches the volume thresholds set forth in the sliding scale in a month. As a Liquidity Provider’s monthly volume increases, its per contract transaction fee decreases. The first 75,000 contracts traded in a month (first tier) are assessed at $.20 per contract. The next 1,125,000 contracts traded (up to 1.2 million total contracts traded—second tier) are assessed at $.18 per contract. The next 1.8 million contracts traded (up to 3 million total contracts traded—third tier) are assessed at $.15 per contract 2 Contract volume resulting from dividend, merger and short stock interest strategies as defined in Footnote 13 of the Fees Schedule does not apply towards reaching the sliding scale volume thresholds. E:\FR\FM\12AUN1.SGM 12AUN1 46956 Federal Register / Vol. 73, No. 156 / Tuesday, August 12, 2008 / Notices and the next 1.8 million contracts traded (up to 4.8 million total contracts traded—fourth tier) are assessed at $.10 per contract. All contracts above 4.8 million contracts traded in a month (fifth tier) are assessed at $.03 per contract.3 The Exchange proposes to add a sixth tier in order to provide an additional fee reduction at higher volume levels. Specifically, the Exchange proposes to assess $.01 per contract for all contracts above 10 million contracts traded by a Liquidity Provider in a month. Accordingly, the fifth tier would be revised to reflect that all contracts above 4.8 million up to 10 million contracts traded in a month would be assessed $.03 per contract. No other changes to the program are proposed. The Exchange plans to implement the proposed fee change on August 1, 2008. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (‘‘Act’’) 4, in general, and furthers the objectives of Section 6(b)(4) 5 of the Act in particular, in that it is designed to provide for the equitable allocation of reasonable dues, fees, and other charges among CBOE members. The proposed fee change would provide an additional fee reduction to Liquidity Providers at higher monthly volume levels. B. Self-Regulatory Organization’s Statement on Burden on Competition CBOE 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 sroberts on PROD1PC70 with NOTICES No written comments were solicited or received with respect to the proposed rule change. 3 The Exchange aggregates the trading activity of separate Liquidity Provider firms for purposes of the sliding scale if there is at least 75% common ownership between the firms as reflected on each firm’s Form BD, Schedule A. A Liquidity Provider’s monthly contract volume is determined at the firm affiliation level, e.g., if five Liquidity Provider individuals are affiliated with the same member firm as reflected by Exchange records for the entire month, all of the volume from those five individual Liquidity Providers count towards that firm’s sliding scale transaction fees for that month. See CBOE Fees Schedule, Footnote 10. 4 15 U.S.C. 78f(b). 5 15 U.S.C. 78f(b)(4). VerDate Aug<31>2005 16:24 Aug 11, 2008 Jkt 214001 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 6 and subparagraph (f)(2) of Rule 19b–4 thereunder.7 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. 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–CBOE–2008–78 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–CBOE–2008–78. 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 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 6 15 7 17 PO 00000 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(2). Frm 00088 Fmt 4703 Sfmt 4703 of such filing also will be available for inspection and copying at the principal office of CBOE. 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–CBOE– 2008–78, and should be submitted on or before September 2, 2008. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Florence E. Harmon, Acting Secretary. [FR Doc. E8–18602 Filed 8–11–08; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–58300; File No. SR–NSCC– 2008–06] Self-Regulatory Organizations; The National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Enhance the Equity Options Service To Include Bond Options August 4, 2008. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 notice is hereby given that on July 25, 2008, the National Securities Clearing Corporation (‘‘NSCC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change described in Items I, II, and III below, which items have been prepared primarily by NSCC. The Commission is publishing this notice to solicit comments on the proposed rule change from interested parties. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change NSCC proposes to amend its rules in order to enhance the NSCC Equity Options Service by extending similar processing to bond options transactions. The enhanced service will be called the ‘‘NSCC Equity Options and Bond Options Service.’’2 8 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 Changes are to the rule text that appears in the electronic manual of NSCC found at http:// www.nscc.com/legal/. 1 15 E:\FR\FM\12AUN1.SGM 12AUN1

Agencies

[Federal Register Volume 73, Number 156 (Tuesday, August 12, 2008)]
[Notices]
[Pages 46955-46956]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-18602]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58321; File No. SR-CBOE-2008-78]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to Market-Maker Transaction Fees

August 6, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
\1\, notice is hereby given that on July 25, 2008, the Chicago Board 
Options Exchange, Incorporated (``CBOE'' 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 prepared by CBOE. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
---------------------------------------------------------------------------

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

    CBOE proposes to amend its Fees Schedule relating to market-maker 
transaction fees. The text of the proposed rule change is available on 
the Exchange's Web site (http://www.cboe.org/legal), at the Exchange's 
Office of the Secretary and at the Commission.

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

    In its filing with the Commission, CBOE 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. CBOE 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
    Under the Exchange's ``Liquidity Provider Sliding Scale'' program, 
the Exchange reduces Liquidity Provider (CBOE Market-Maker, DPM, e-DPM 
and LMM) per contract transaction fees based on the number of contracts 
a Liquidity Provider trades in a month. The sliding scale applies to 
Liquidity Provider transaction fees in all products.\2\
---------------------------------------------------------------------------

    \2\ Contract volume resulting from dividend, merger and short 
stock interest strategies as defined in Footnote 13 of the Fees 
Schedule does not apply towards reaching the sliding scale volume 
thresholds.
---------------------------------------------------------------------------

    A Liquidity Provider's standard $.20 per contract transaction fee 
is reduced if the Liquidity Provider reaches the volume thresholds set 
forth in the sliding scale in a month. As a Liquidity Provider's 
monthly volume increases, its per contract transaction fee decreases. 
The first 75,000 contracts traded in a month (first tier) are assessed 
at $.20 per contract. The next 1,125,000 contracts traded (up to 1.2 
million total contracts traded--second tier) are assessed at $.18 per 
contract. The next 1.8 million contracts traded (up to 3 million total 
contracts traded--third tier) are assessed at $.15 per contract

[[Page 46956]]

and the next 1.8 million contracts traded (up to 4.8 million total 
contracts traded--fourth tier) are assessed at $.10 per contract. All 
contracts above 4.8 million contracts traded in a month (fifth tier) 
are assessed at $.03 per contract.\3\
---------------------------------------------------------------------------

    \3\ The Exchange aggregates the trading activity of separate 
Liquidity Provider firms for purposes of the sliding scale if there 
is at least 75% common ownership between the firms as reflected on 
each firm's Form BD, Schedule A. A Liquidity Provider's monthly 
contract volume is determined at the firm affiliation level, e.g., 
if five Liquidity Provider individuals are affiliated with the same 
member firm as reflected by Exchange records for the entire month, 
all of the volume from those five individual Liquidity Providers 
count towards that firm's sliding scale transaction fees for that 
month. See CBOE Fees Schedule, Footnote 10.
---------------------------------------------------------------------------

    The Exchange proposes to add a sixth tier in order to provide an 
additional fee reduction at higher volume levels. Specifically, the 
Exchange proposes to assess $.01 per contract for all contracts above 
10 million contracts traded by a Liquidity Provider in a month. 
Accordingly, the fifth tier would be revised to reflect that all 
contracts above 4.8 million up to 10 million contracts traded in a 
month would be assessed $.03 per contract.
    No other changes to the program are proposed. The Exchange plans to 
implement the proposed fee change on August 1, 2008.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
Section 6(b) of the Securities Exchange Act of 1934 (``Act'') \4\, in 
general, and furthers the objectives of Section 6(b)(4) \5\ of the Act 
in particular, in that it is designed to provide for the equitable 
allocation of reasonable dues, fees, and other charges among CBOE 
members. The proposed fee change would provide an additional fee 
reduction to Liquidity Providers at higher monthly volume levels.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE does not believe that the proposed rule change will impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \6\ and subparagraph (f)(2) of Rule 19b-4 
thereunder.\7\ 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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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-CBOE-2008-78 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2008-78. 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 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 CBOE. 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-CBOE-2008-78, and should be 
submitted on or before September 2, 2008.
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    \8\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-18602 Filed 8-11-08; 8:45 am]
BILLING CODE 8010-01-P