Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing of Proposed Rule Change Relating to Zero Bid Orders on the Boston Options Exchange Facility, 9840-9841 [E9-4769]

Download as PDF 9840 Federal Register / Vol. 74, No. 43 / Friday, March 6, 2009 / Notices 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)(iii) of the Act 7 and Rule 19b–4(f)(3) 8 thereunder because it is concerned solely with the administration of 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. 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: 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 the filing will also be available for inspection and copying at the principal office of the self-regulatory organization. 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– 2009–010 and should be submitted on or before March 27, 2009. BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Florence E. Harmon, Deputy Secretary. [FR Doc. E9–4757 Filed 3–5–09; 8:45 am] mstockstill on PROD1PC66 with NOTICES [Release No. 34–59475; File No. SR–BX– 2009–014] Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–CBOE–2009–010. 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 February 27, 2009. 8 17 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(3). VerDate Nov<24>2008 16:20 Mar 05, 2009 Jkt 217001 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 self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. Electronic Comments • 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–CBOE–2009–010 on the subject line. 7 15 office of the Exchange, at the Commission’s Public Reference Room and also on the Exchange’s Internet Web site at https:// nasdaqomxbx.cchwallstreet.com/ NASDAQOMXBX/Filings/. Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing of Proposed Rule Change Relating to Zero Bid Orders on the Boston Options Exchange Facility 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 February 26, 2009, NASDAQ OMX BX, Inc. (the ‘‘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 the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Chapter V, Section 14 (Order Entry) of the Rules of the Boston Options Exchange Group, LLC (‘‘BOX’’) to clarify the treatment of certain Zero Bid Orders.3 The text of the proposed rule change is available from the principal 9 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Capitalized terms not otherwise defined herein shall have the meanings set forth in the BOX Rules. 1 15 PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 1. Purpose The purpose of the proposed rule change is to amend Chapter V, Section 14 of the BOX Rules to clarify the treatment of Market Orders to sell and BOX-Top Orders to sell when the highest bid on BOX is zero in the options series for a particular order (‘‘Zero Bid Order’’). Currently, Section 14 states, in part, that: ‘‘[i]n the case where the lowest offer for any options contract is $.05, and an Options Participant enters a Market Order to sell that series, any such Market Order shall be considered a Limit Order to sell at a price of $.05.’’ 4 The Exchange seeks to amend Chapter V, Section 14 of the BOX Rules to (1) clarify the specific circumstances under which an order will be considered a Zero Bid Order, (2) address the treatment of Zero Bid Orders in options classes that trade in other than $.05 increments, and (3) address the treatment of Zero Bid Orders that would cause a locked or crossed market. The Exchange proposes to amend Section 14 so that it will apply equally to Market Orders to sell and BOX-Top Orders to sell when the highest bid on BOX is zero in the options series. In this case such Zero Bid Orders shall be considered a Limit Order to sell at a price, above zero, that is equal to the minimum trading increment applicable to that particular options series. Consequently, where the BOX market displays a zero bid and the options 4 See E:\FR\FM\06MRN1.SGM Chapter V, Section 14 of the BOX Rules. 06MRN1 Federal Register / Vol. 74, No. 43 / Friday, March 6, 2009 / Notices series is subject to the Penny Pilot Program,5 the Zero Bid Order will be considered a Limit Order to sell at a price of $.01. If the options series is not subject to the Penny Pilot Program, the Zero Bid Order will be considered a Limit Order to sell at a price of $.05 or $.10, depending upon the minimum trading increment for the specific options series of the Zero Bid Order. The Exchange also seeks to clarify that if the resulting Limit Order would cause either a locked or crossed market, then the original Market Order or BOXTop Order will be rejected by the Trading Host. 2. Basis The Exchange believes that the proposal is consistent with the requirements of Section 6(b) of the Act,6 in general, and Section 6(b)(5) of the Act,7 in particular, in that it is designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts, to foster cooperation and coordination with persons engaged in facilitating 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 proposed amendments will give greater clarification to Options Participants regarding the handling of Zero Bid Orders and provide enhanced treatment of such orders on BOX. 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 not necessary or appropriate in furtherance of the purposes of the Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action mstockstill on PROD1PC66 with NOTICES Within 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) 5 BOX may trade options contracts in one-cent increments in certain approved issues through March 27, 2009, as part of the Penny Pilot Program. See Securities Exchange Act Release No. 56566 (September 27, 2007), 72 FR 56400 (October 3, 2007) (SR–BSE–2007–40). 6 15 U.S.C. 78f(b). 7 15 U.S.C. 78f(b)(5). VerDate Nov<24>2008 16:20 Mar 05, 2009 Jkt 217001 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 the self-regulatory organization 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: 9841 submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–BX– 2009–014 and should be submitted on or before March 27, 2009. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Florence E. Harmon, Deputy Secretary. [FR Doc. E9–4769 Filed 3–5–09; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–59460; File Nos. SR– NASDAQ–2009–010, SR–BX–2009–009, SR–Phlx–2009–14] Electronic Comments • 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–BX–2009–014 on the subject line. Self-Regulatory Organizations; the NASDAQ Stock Market, LLC; NASDAQ OMX BX, Inc.; NASDAQ OMX Phlx, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Changes To Amend the Certificate of Incorporation of The NASDAQ OMX Group, Inc. Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–BX–2009–014. 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 business days between the hours of 10 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from February 26, 2009. PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 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 February 17, 2009, The NASDAQ Stock Market, LLC (‘‘NASDAQ Exchange’’) and NASDAQ OMX BX, Inc. (‘‘BX’’), and on February 20, 2009, NASDAQ OMX Phlx, Inc. (‘‘PHLX’’) (collectively, the ‘‘NASDAQ OMX Exchange Subsidiaries’’) 3 filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule changes as described in Items I, II, and III below, which Items have been substantially prepared by the NASDAQ OMX Exchange Subsidiaries. The Commission is publishing this notice to solicit comments on the proposed rule changes from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of the Substance of the Proposed Rule Change The NASDAQ OMX Exchange Subsidiaries are filing the proposed rule changes with regard to proposed changes to the Restated Certificate of 8 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Substantially similar filings have been submitted by Boston Stock Exchange Clearing Corporation (‘‘BSECC’’) (SR–BSECC–2009–001) and Stock Clearing Corporation of Philadelphia (‘‘SCCP’’) (SR–SCCP–2009–01), the clearing corporation subsidiaries of NASDAQ OMX Group, Inc. (‘‘NASDAQ OMX’’). 1 15 E:\FR\FM\06MRN1.SGM 06MRN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 74, Number 43 (Friday, March 6, 2009)]
[Notices]
[Pages 9840-9841]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-4769]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59475; File No. SR-BX-2009-014]


Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of 
Filing of Proposed Rule Change Relating to Zero Bid Orders on the 
Boston Options Exchange Facility

February 27, 2009.
    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 February 26, 2009, NASDAQ OMX BX, Inc. (the ``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 the self-regulatory organization. The Commission 
is publishing this notice to solicit comments on the proposed rule 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

    The Exchange proposes to amend Chapter V, Section 14 (Order Entry) 
of the Rules of the Boston Options Exchange Group, LLC (``BOX'') to 
clarify the treatment of certain Zero Bid Orders.\3\ The text of the 
proposed rule change is available from the principal office of the 
Exchange, at the Commission's Public Reference Room and also on the 
Exchange's Internet Web site at https://nasdaqomxbx.cchwallstreet.com/
NASDAQOMXBX/Filings/.
---------------------------------------------------------------------------

    \3\ Capitalized terms not otherwise defined herein shall have 
the meanings set forth in the BOX Rules.
---------------------------------------------------------------------------

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 self-regulatory organization 
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 amend Chapter V, 
Section 14 of the BOX Rules to clarify the treatment of Market Orders 
to sell and BOX-Top Orders to sell when the highest bid on BOX is zero 
in the options series for a particular order (``Zero Bid Order''). 
Currently, Section 14 states, in part, that: ``[i]n the case where the 
lowest offer for any options contract is $.05, and an Options 
Participant enters a Market Order to sell that series, any such Market 
Order shall be considered a Limit Order to sell at a price of $.05.'' 
\4\
---------------------------------------------------------------------------

    \4\ See Chapter V, Section 14 of the BOX Rules.
---------------------------------------------------------------------------

    The Exchange seeks to amend Chapter V, Section 14 of the BOX Rules 
to (1) clarify the specific circumstances under which an order will be 
considered a Zero Bid Order, (2) address the treatment of Zero Bid 
Orders in options classes that trade in other than $.05 increments, and 
(3) address the treatment of Zero Bid Orders that would cause a locked 
or crossed market.
    The Exchange proposes to amend Section 14 so that it will apply 
equally to Market Orders to sell and BOX-Top Orders to sell when the 
highest bid on BOX is zero in the options series. In this case such 
Zero Bid Orders shall be considered a Limit Order to sell at a price, 
above zero, that is equal to the minimum trading increment applicable 
to that particular options series.
    Consequently, where the BOX market displays a zero bid and the 
options

[[Page 9841]]

series is subject to the Penny Pilot Program,\5\ the Zero Bid Order 
will be considered a Limit Order to sell at a price of $.01. If the 
options series is not subject to the Penny Pilot Program, the Zero Bid 
Order will be considered a Limit Order to sell at a price of $.05 or 
$.10, depending upon the minimum trading increment for the specific 
options series of the Zero Bid Order.
---------------------------------------------------------------------------

    \5\ BOX may trade options contracts in one-cent increments in 
certain approved issues through March 27, 2009, as part of the Penny 
Pilot Program. See Securities Exchange Act Release No. 56566 
(September 27, 2007), 72 FR 56400 (October 3, 2007) (SR-BSE-2007-
40).
---------------------------------------------------------------------------

    The Exchange also seeks to clarify that if the resulting Limit 
Order would cause either a locked or crossed market, then the original 
Market Order or BOX-Top Order will be rejected by the Trading Host.
2. Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\6\ in general, and Section 
6(b)(5) of the Act,\7\ in particular, in that it is designed to promote 
just and equitable principles of trade, to prevent fraudulent and 
manipulative acts, to foster cooperation and coordination with persons 
engaged in facilitating 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 proposed amendments will give greater 
clarification to Options Participants regarding the handling of Zero 
Bid Orders and provide enhanced treatment of such orders on BOX.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 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 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

    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

    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 the self-regulatory organization 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-BX-2009-014 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-BX-2009-014. 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 business days between the hours of 10 a.m. and 
3 p.m. Copies of such filing also will be available for inspection and 
copying at the principal office of the Exchange. All comments received 
will be posted without change; the Commission does not edit personal 
identifying information from submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-BX-2009-014 and should be submitted on 
or before March 27, 2009.

    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,
Deputy Secretary.
[FR Doc. E9-4769 Filed 3-5-09; 8:45 am]
BILLING CODE 8011-01-P

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