Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change, as Modified by Amendment No. 1, by NYSE Arca, Inc. Implementing Schedule of Fees and Charges for Exchange Services by adding a Ratio Threshold Fee, 29251-29252 [E9-14352]

Download as PDF Federal Register / Vol. 74, No. 117 / Friday, June 19, 2009 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–60102; File No. SR– NYSEArca-2009–50] Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change, as Modified by Amendment No. 1, by NYSE Arca, Inc. Implementing Schedule of Fees and Charges for Exchange Services by adding a Ratio Threshold Fee June 11, 2009. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on June 1, 2009, NYSE Arca, Inc. (‘‘NYSE Arca’’ or the ‘‘Exchange’’) 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 prepared by the self-regulatory organization. On June 9, 2009, the Exchange filed Amendment No. 1 to the proposed rule change.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 its Schedule of Fees and Charges for Exchange Services (‘‘Schedule’’) by adding a Ratio Threshold Fee. While changes to the Schedule pursuant to this proposal will be effective upon filing, the proposed fee will become operative on June 1, 2009. The text of the proposed rule change is attached as Ex.5 to the 19b–4 form. A copy of this filing is available on the Exchange’s Web site at https://www.nyse.com, at the Exchange’s principal office 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 1 15 U.S.C.78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 4 In Amendment No. 1, the Exchange corrected a typographical error that occurred on the cover sheet that accompanied the Exchange’s submission on Form 19b–4. Specifically, the Exchange conformed its categorization of the statutory provision applicable to the proposed rule change (i.e., Section 19(b)(3)(A) instead of Section 19(b)(2) of the Act) to make the cover sheet consistent with the text of the Form 19b–4. mstockstill on PROD1PC66 with NOTICES 2 15 VerDate Nov<24>2008 16:25 Jun 18, 2009 Jkt 217001 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 Exchange proposes adding a Ratio Threshold Fee to its Fee Schedule. The proposed Ratio Threshold Fee will be charged to OTP Holders based on the number of orders entered compared to the number of executions received in a calendar month. The fee will be assessed as follows: Monthly order to execution ratio Between 10,000 and 14,999 to 1 Between 15,000 and 19,999 to 1 Between 20,000 and 24,999 to 1 25,000 to 1 and greater ................ Monthly charge $5,000 10,000 20,000 35,000 This fee shall not apply to orders that improve the Exchange’s prevailing best bid-offer (BBO) market at the time the orders are received. OTP Holders with order to execution ratios of 10,000 to 1 or greater have the potential residual effect of exhausting system resources, bandwidth, and capacity. Such order to execution ratios may, in turn, create latency and impact other OTP Holders ability to receive timely executions. Recognizing that orders and executions often occur in large numbers, the purpose of this fee is to focus on activity that is truly disproportionate while fairly allocating costs among members. The proposed fee has multiple thresholds and is greater at higher order to execution ratios because the potential impact on exchange systems, bandwidth and capacity becomes greater with increased order to execution ratios. The new Ratio Threshold Fee will become effective on June 1, 2009. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Securities Exchange Act of 1934 (the ‘‘Act’’),5 in general, and Section 6(b)(4) of the Act,6 in particular, in that it is designed to provide for the equitable allocation of reasonable dues, fees, and 5 15 6 15 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(4). Frm 00088 Fmt 4703 other charges among its members and other persons using its facilities. Under this proposal, all similarly situated members of NYSE Arca will be charged the same reasonable dues, fees and other charges. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others 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 is effective upon filing pursuant to Section 19(b)(3)(A) 7 of the Act and subparagraph (f)(2) of Rule 19b–4 8 thereunder, because it establishes a due, fee, or other charge imposed by NYSE Arca. 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 (https://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSEArca-2009–50 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. 7 15 8 17 Sfmt 4703 29251 E:\FR\FM\19JNN1.SGM U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(2). 19JNN1 29252 Federal Register / Vol. 74, No. 117 / Friday, June 19, 2009 / Notices All submissions should refer to File Number SR–NYSEArca-2009–50. 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 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– NYSEArca-2009–50 and should be submitted on or before July 10, 2009. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Florence E. Harmon, Deputy Secretary. [FR Doc. E9–14352 Filed 6–18–09; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–60103; File No. SR–Phlx– 2009–47] Self-Regulatory Organizations; NASDAQ OMX PHLX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Order Routing Fees mstockstill on PROD1PC66 with NOTICES June 11, 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 June 5, 2009, NASDAQ OMX PHLX, Inc. 9 17 CFR 200.30–3(a)(12). U.S.C.78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate Nov<24>2008 16:25 Jun 18, 2009 Jkt 217001 (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by the Exchange. 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 adopt fees governing pricing for Phlx members using the Phlx XL II system,3 for routing standardized equity and index options to away markets for execution. The text of the proposed rule change is available on the Exchange’s Web site at https:// nasdaqomxphlx.cchwallstreet.com/ NASDAQOMXPHLX/Filings/, at the principal office of 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 Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of the proposed rule change is to adopt fees for executions of options orders entered into the Exchange’s enhanced electronic trading platform for options, Phlx XL II but routed to away markets. The Exchange proposes a routing fee based upon the cost to the Exchange of executing such orders at those markets. In order to reflect the Exchange’s cost of execution at away markets, the fees will be separated as applicable, depending on the away market’s fee schedule, by type 3 For a complete description of Phlx XL II, see Securities Exchange Act Release No. 59995 (May 28, 2009), 74 FR 26750 (June 3, 2009) (SR–Phlx– 2009–32). The instant proposed fees will apply only to options entered into, and routed by, the Phlx XL II system. PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 of option (penny pilot, equity/nonpenny pilot, ETF or HLDS/non-penny pilot, and Index) and vary depending upon whether the order is being routed for a customer, a member firm, a market maker (which includes a specialist, a Registered Options Trader, a Streaming Quote Trader (‘‘SQT’’),4 and a Remote Streaming Quote Trader (‘‘RSQT’’)),5 or by a Floor Broker. Initially, the Phlx XL II system will only route customer orders.6 The Table reflects that routing fees are currently not applicable to firms and market makers, since their order will not be routed by the Phlx XL II system. In the event that the Exchange determines to route firm and market maker orders, membership will be notified by an Options Trader Alert (‘‘OTA’’) of any applicable routing fees, and the Table will be updated to reflect such fees. The Exchange proposes to pass through to Exchange members the actual transaction fees (including surcharges/ license fees if applicable) assessed by away markets plus the clearing fees for the execution of orders routed from the Phlx XL II system. The Exchange has collected and organized in table format the fees to be assessed for routing to each destination exchange.7 The Exchange recently adopted Rule 1080(m)(iii)(A) to establish Nasdaq Options Services LLC (‘‘NOS’’), a member of the Exchange, as the Exchange’s exclusive order router.8 The sole use of NOS by the Phlx XL II system will be to route orders in options listed and open for trading on the Phlx XL II system to destination markets. A particular destination market would charge NOS their applicable transaction fees, which would then be passed through to Phlx, and ultimately to the initiating member under this proposal. Similarly, clearing fees charged to NOS by the Options Clearing Corporation 4 An SQT is an Exchange Registered Options Trader (‘‘ROT’’) who has received permission from the Exchange to generate and submit option quotations electronically through AUTOM in eligible options to which such SQT is assigned. An SQT may only submit such quotations while such SQT is physically present on the floor of the Exchange. See Exchange Rule 1014(b)(ii)(A). 5 An RSQT is an ROT that is a member or member organization with no physical trading floor presence who has received permission from the Exchange to generate and submit option quotations electronically through AUTOM in eligible options to which such RSQT has been assigned. An RSQT may only submit such quotations electronically from off the floor of the Exchange. See Exchange Rule 1014(b)(ii)(B). 6 See supra note 3. 7 See Exhibit 3 to the proposed rule change. See also infra note 9 8 See Securities Exchange Act Release No. 59995 (May 28, 2009), 74 FR 26750 (June 3, 2009) (SR– Phlx–2009–32). E:\FR\FM\19JNN1.SGM 19JNN1

Agencies

[Federal Register Volume 74, Number 117 (Friday, June 19, 2009)]
[Notices]
[Pages 29251-29252]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-14352]



[[Page 29251]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60102; File No. SR-NYSEArca-2009-50]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change, as Modified by Amendment No. 1, 
by NYSE Arca, Inc. Implementing Schedule of Fees and Charges for 
Exchange Services by adding a Ratio Threshold Fee

June 11, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on June 1, 2009, NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange'') 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 prepared by the self-regulatory 
organization. On June 9, 2009, the Exchange filed Amendment No. 1 to 
the proposed rule change.\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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ In Amendment No. 1, the Exchange corrected a typographical 
error that occurred on the cover sheet that accompanied the 
Exchange's submission on Form 19b-4. Specifically, the Exchange 
conformed its categorization of the statutory provision applicable 
to the proposed rule change (i.e., Section 19(b)(3)(A) instead of 
Section 19(b)(2) of the Act) to make the cover sheet consistent with 
the text of the Form 19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend its Schedule of Fees and Charges for 
Exchange Services (``Schedule'') by adding a Ratio Threshold Fee. While 
changes to the Schedule pursuant to this proposal will be effective 
upon filing, the proposed fee will become operative on June 1, 2009. 
The text of the proposed rule change is attached as Ex.5 to the 19b-4 
form. A copy of this filing is available on the Exchange's Web site at 
https://www.nyse.com, at the Exchange's principal office 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 Exchange proposes adding a Ratio Threshold Fee to its Fee 
Schedule. The proposed Ratio Threshold Fee will be charged to OTP 
Holders based on the number of orders entered compared to the number of 
executions received in a calendar month. The fee will be assessed as 
follows:

------------------------------------------------------------------------
                                                                Monthly
               Monthly order to execution ratio                  charge
------------------------------------------------------------------------
Between 10,000 and 14,999 to 1...............................     $5,000
Between 15,000 and 19,999 to 1...............................     10,000
Between 20,000 and 24,999 to 1...............................     20,000
25,000 to 1 and greater......................................     35,000
------------------------------------------------------------------------

    This fee shall not apply to orders that improve the Exchange's 
prevailing best bid-offer (BBO) market at the time the orders are 
received.
    OTP Holders with order to execution ratios of 10,000 to 1 or 
greater have the potential residual effect of exhausting system 
resources, bandwidth, and capacity. Such order to execution ratios may, 
in turn, create latency and impact other OTP Holders ability to receive 
timely executions. Recognizing that orders and executions often occur 
in large numbers, the purpose of this fee is to focus on activity that 
is truly disproportionate while fairly allocating costs among members. 
The proposed fee has multiple thresholds and is greater at higher order 
to execution ratios because the potential impact on exchange systems, 
bandwidth and capacity becomes greater with increased order to 
execution ratios.
    The new Ratio Threshold Fee will become effective on June 1, 2009.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Securities Exchange Act of 1934 
(the ``Act''),\5\ in general, and Section 6(b)(4) of the 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 other persons using its facilities. Under this proposal, 
all similarly situated members of NYSE Arca will be charged the same 
reasonable dues, fees and other charges.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

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

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

    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 is effective upon filing pursuant to 
Section 19(b)(3)(A) \7\ of the Act and subparagraph (f)(2) of Rule 19b-
4 \8\ thereunder, because it establishes a due, fee, or other charge 
imposed by NYSE Arca.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    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 (https://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2009-50 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.


[[Page 29252]]


All submissions should refer to File Number SR-NYSEArca-2009-50. 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 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-
NYSEArca-2009-50 and should be submitted on or before July 10, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-14352 Filed 6-18-09; 8:45 am]
BILLING CODE 8010-01-P
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