Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Penny Pilot Program, 15017-15018 [E9-7351]
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Federal Register / Vol. 74, No. 62 / Thursday, April 2, 2009 / Notices
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59630; File No. SR–CBOE–
2009–021]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to the Penny
Pilot Program
March 26, 2009.
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 March 24,
2009, 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 and II
below, which Items have been 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 Penny Pilot
Program. 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.
mstockstill on PROD1PC66 with NOTICES
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 those 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 parts of such
statements.
1 15
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
VerDate Nov<24>2008
17:43 Apr 01, 2009
Jkt 217001
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The industry-wide Penny Pilot
Program is scheduled to expire on
March 27, 2009.5 CBOE is filing this
proposed rule change to amend the
Penny Pilot Program such that it will
continue ‘‘as is’’ until July 3, 2009, in
the option classes that have been
selected to participate in the Penny Pilot
Program. Extending the Pilot Program as
proposed in this rule filing will allow
further analysis of the Pilot Program.
Additionally, CBOE states that it
intends to submit to the Commission a
report analyzing the Penny Pilot
Program for the period February 1, 2009
through April 30, 2009. CBOE’s report
should be submitted by the end of May
2009.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations under the
Act applicable to a national securities
exchange and, in particular, the
requirements of Section 6(b) of the Act.
Specifically, the Exchange believes the
proposed rule change is consistent with
the Section 6(b)(5) of the Act 6
requirements that the rules of an
exchange be designed to promote just
and equitable principles of trade, to
prevent fraudulent and manipulative
acts and, in general, to protect investors
and the public interest, in that
extending the Penny Pilot Program will
allow for further analysis.
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.
5 Initially, thirteen option classes were included
in the Pilot Program. On September 28, 2007,
twenty-two additional option classes were added to
the Pilot Program. On March 28, 2008, twenty-eight
additional classes were added to the Pilot Program.
Presently, fifty-eight option classes participate in
the Penny Pilot Program. CBOE also quotes and
trades XSP options and DJX options in $.01
increments for all option series below $3, and $.05
increments for all option series $3 and above. See
Securities Exchange Act Release No. 55154 (January
23, 2007), 72 FR 4743 (February 1, 2007) (SR–
CBOE–2006–92); See also Securities Exchange Act
Release No. 56139 (July 26, 2007), 72 FR 42159
(August 1, 2007) (SR–CBOE–2007–86); Securities
Exchange Act Release No. 56565 (September 27,
2007), 72 FR 56403 (October 3, 2007) (SR–CBOE–
2007–98); Securities Exchange Act Release No.
57576 (March 28, 2008) 73 FR 18306 (April 3, 2008)
(SR–CBOE–2008–33).
6 15 U.S.C. 78f(b)(5).
PO 00000
Frm 00066
Fmt 4703
Sfmt 4703
15017
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
The Exchange neither solicited nor
received comments on the proposal.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule does not (i)
significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
for 30 days from the date on which it
was filed, or such shorter time as the
Commission may designate if consistent
with the protection of investors and the
public interest, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) of the Act 7 and Rule
19b–4(f)(6) thereunder.8
The Exchange has requested that the
Commission waive the 30-day operative
delay so that the proposed rule change
may become operative upon filing with
the Commission pursuant to Section
19(b)(3)(A) of the Act 9 and Rule 19b–
4(f)(6) 10 thereunder. The Commission
believes that waiving the 30-day
operative delay is consistent with the
protection of investors and the public
interest because such waiver will allow
the Penny Pilot Program to continue
without interruption through July 3,
2009.11 Accordingly, the Commission
designates the proposed rule change
operative upon filing with the
Commission.
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,
7 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the
Commission written notice of the Exchange’s 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. The Exchange
has satisfied the pre-filing requirement.
9 15 U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b–4.
11 For the purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78(c)(f).
8 17
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15018
Federal Register / Vol. 74, No. 62 / Thursday, April 2, 2009 / Notices
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 rulecomments@sec.gov. Please include File
Number SR–CBOE–2009–021 on the
subject line.
mstockstill on PROD1PC66 with NOTICES
• 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–2009–021. This file
number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for inspection and copying in
the Commission’s Public Reference
Room, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3 p.m.
Copies of such filing also will be
available for inspection and copying at
the principal office of 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–CBOE–2009–021 and should be
submitted on or before April 23, 2009.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–7351 Filed 4–1–09; 8:45 am]
BILLING CODE
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change Relating to an Extension of the
Penny Pilot Program
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 March 24,
2009, the International Securities
Exchange, LLC (the ‘‘Exchange’’ or the
‘‘ISE’’) filed with the Securities and
Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Exchange filed the proposal as a ‘‘noncontroversial’’ 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 ISE is proposing to extend, until
July 3, 2009, a pilot program to quote
and to trade certain options in pennies.
The text of the proposed rule change is
available at the Exchange 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 self regulatory organization has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
1 15
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
CFR 200.30–3(a)(12).
VerDate Nov<24>2008
[Release No. 34–59633; File No. SR–ISE–
2009–14]
March 26, 2009.
Paper Comments
12 17
SECURITIES AND EXCHANGE
COMMISSION
17:43 Apr 01, 2009
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A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
On January 24, 2007, the Commission
approved ISE’s rule filing, SR–ISE–
2006–62, which permits 13 option
classes to quote in penny increments in
connection with the implementation of
an industry wide, six month pilot
program (the ‘‘Penny Pilot Program’’).5
Under the Penny Pilot Program, the
minimum price variation for all 13
option classes, except for the Nasdaq100 Index Tracking Stock (‘‘QQQQ’’), is
$0.01 for all quotations in option series
that are quoted at less than $3 per
contract and $0.05 for all quotations in
options series that are quoted at $3 per
contract or greater. The QQQQs are
quoted in $0.01 increments for all
options series.
Subsequent ISE rule filings initiated a
two-phase expansion of the Penny Pilot
Program. SR–ISE–2007–74 initiated
Phase I of the expansion and added 22
option classes to the Penny Pilot
Program that are among the most
actively traded, multiply-listed option
classes based on national average daily
volume, and together with the original
13 option classes, represent
approximately 35% of the total industry
volume.6
SR–ISE–2008–27 implemented Phase
II of the expansion, which added an
additional 28 option classes to the
Penny Pilot Program.7 The total number
of option classes in the Penny Pilot
Program currently stands at 63. A
Regulatory Information Circular,
attached as Exhibit 5 to this proposed
rule change, identifies all 63 underlying
securities. Phase II of the Penny Pilot
Program is set to expire on March 27,
2009. ISE now proposes to extend the
current Penny Pilot Program until July
3, 2009.
ISE believes extending the Penny
Pilot Program as proposed by this rule
filing will allow the Exchange and the
Commission additional time to continue
its analysis of the impact of quoting and
trading option classes in penny
increments and the impact of the Penny
5 See Securities Exchange Act Release No. 55161
(January 24, 2007), 72 FR 4754 (February 1, 2007)
(the ‘‘Initial Filing’’). The Penny Pilot Program was
subsequently extended for an additional two month
period, until September 27, 2007. See Securities
Exchange Act Release No. 56151 (July 26, 2007), 72
FR 42452 (August 2, 2007).
6 See Securities Exchange Act Release No. 56564
(September 27, 2007), 72 FR 56412 (October 3,
2007).
7 See Securities Exchange Act Release No. 57508
(March 17, 2008), 73 FR 15243 (March 21, 2008).
E:\FR\FM\02APN1.SGM
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]]>Agencies
[Federal Register Volume 74, Number 62 (Thursday, April 2, 2009)]
[Notices]
[Pages 15017-15018]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-7351]
[[Page 15017]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-59630; File No. SR-CBOE-2009-021]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Relating to the Penny Pilot Program
March 26, 2009.
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 March 24, 2009, 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 and II below, which Items have been 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
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 Penny
Pilot Program. 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 those 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 parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The industry-wide Penny Pilot Program is scheduled to expire on
March 27, 2009.\5\ CBOE is filing this proposed rule change to amend
the Penny Pilot Program such that it will continue ``as is'' until July
3, 2009, in the option classes that have been selected to participate
in the Penny Pilot Program. Extending the Pilot Program as proposed in
this rule filing will allow further analysis of the Pilot Program.
---------------------------------------------------------------------------
\5\ Initially, thirteen option classes were included in the
Pilot Program. On September 28, 2007, twenty-two additional option
classes were added to the Pilot Program. On March 28, 2008, twenty-
eight additional classes were added to the Pilot Program. Presently,
fifty-eight option classes participate in the Penny Pilot Program.
CBOE also quotes and trades XSP options and DJX options in $.01
increments for all option series below $3, and $.05 increments for
all option series $3 and above. See Securities Exchange Act Release
No. 55154 (January 23, 2007), 72 FR 4743 (February 1, 2007) (SR-
CBOE-2006-92); See also Securities Exchange Act Release No. 56139
(July 26, 2007), 72 FR 42159 (August 1, 2007) (SR-CBOE-2007-86);
Securities Exchange Act Release No. 56565 (September 27, 2007), 72
FR 56403 (October 3, 2007) (SR-CBOE-2007-98); Securities Exchange
Act Release No. 57576 (March 28, 2008) 73 FR 18306 (April 3, 2008)
(SR-CBOE-2008-33).
---------------------------------------------------------------------------
Additionally, CBOE states that it intends to submit to the
Commission a report analyzing the Penny Pilot Program for the period
February 1, 2009 through April 30, 2009. CBOE's report should be
submitted by the end of May 2009.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations under the Act applicable to a
national securities exchange and, in particular, the requirements of
Section 6(b) of the Act. Specifically, the Exchange believes the
proposed rule change is consistent with the Section 6(b)(5) of the Act
\6\ requirements that the rules of an exchange be designed to promote
just and equitable principles of trade, to prevent fraudulent and
manipulative acts and, in general, to protect investors and the public
interest, in that extending the Penny Pilot Program will allow for
further analysis.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
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
The Exchange neither solicited nor received comments on the
proposal.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule does not (i) significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate if consistent with the protection of investors
and the public interest, the proposed rule change has become effective
pursuant to Section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)
thereunder.\8\
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's 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. The
Exchange has satisfied the pre-filing requirement.
---------------------------------------------------------------------------
The Exchange has requested that the Commission waive the 30-day
operative delay so that the proposed rule change may become operative
upon filing with the Commission pursuant to Section 19(b)(3)(A) of the
Act \9\ and Rule 19b-4(f)(6) \10\ thereunder. The Commission believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest because such waiver
will allow the Penny Pilot Program to continue without interruption
through July 3, 2009.\11\ Accordingly, the Commission designates the
proposed rule change operative upon filing with the Commission.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4.
\11\ For the purposes only of waiving the 30-day operative
delay, the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78(c)(f).
---------------------------------------------------------------------------
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,
[[Page 15018]]
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-CBOE-2009-021 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-CBOE-2009-021. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of 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-CBOE-2009-021 and should be
submitted on or before April 23, 2009.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
Florence E. Harmon,
Deputy Secretary.
---------------------------------------------------------------------------
\12\ 17 CFR 200.30-3(a)(12).
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[FR Doc. E9-7351 Filed 4-1-09; 8:45 am]
BILLING CODE
