Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change, as Modified by Amendment No. 2 Thereto, Relating to Fee Changes, 5826-5827 [2010-2334]

Download as PDF 5826 Federal Register / Vol. 75, No. 23 / Thursday, February 4, 2010 / Notices submission,9 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 also will be available for inspection and copying at the principal office of the ISE. 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–ISE–2010–04 and should be submitted on or before February 25, 2010. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.10 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–2333 Filed 2–3–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change, as Modified by Amendment No. 2 Thereto, Relating to Fee Changes srobinson on DSKHWCL6B1PROD with NOTICES January 27, 2010. 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 January 14, 2010, the International Securities Exchange, LLC (the ‘‘Exchange’’ or the ‘‘ISE’’) filed with the Securities and Exchange Commission the proposed rule change, as described in Items I, II, and III below, which items have been 9 The text of the proposed rule change is available on ISE’s Web site at https://www.ise.com, on the Commission’s Web site at https://www.sec.gov, at ISE, and at the Commission’s Public Reference Room. 10 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 17:31 Feb 03, 2010 Jkt 220001 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The ISE is proposing to amend its Schedule of Fees. The text of the proposed rule change is available on the Exchange’s Web site (https:// www.ise.com), 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 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 [Release No. 34–61434; File No. SR–ISE– 2010–06] VerDate Nov<24>2008 prepared by the self-regulatory organization. On January 27, 2010, ISE filed Amendment No. 1 to the proposed rule change. On January 27, 2010, ISE withdrew Amendment No. 1 and filed Amendment No. 2 to the proposed rule change.3 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 1. Purpose ISE proposes to amend its Schedule of Fees. Specifically, the Exchange proposes to adopt a $0.20 per contract execution fee for professional customers who execute orders as a result of posting liquidity to ISE’s order book. ISE recently adopted a rule change to distinguish between Priority Customer Orders and Professional Orders.4 A Priority Customer is defined in ISE Rule 100(a)(37A) as a person or entity that is not a broker or dealer in securities, and does not place more than 390 orders in listed options per day on average during a calendar month for its own beneficial account(s). A Professional Order is defined in ISE Rule 100(a)(37C) as an order that is for the account of a person or entity that is not a Priority Customer. For purpose of this discussion, 3 Amendment No. 2 deleted a sentence in the purpose section of the filing and in Exhibit 1. 4 See Exchange Act Release No. 59287 (Jan. 23, 2009), 74 FR 5694 (Jan. 30, 2009). PO 00000 Frm 00071 Fmt 4703 Sfmt 4703 ‘‘professional customers’’ are nonbroker/dealer participants who enter at least 390 orders per day on average during a calendar month for their own beneficial account(s). The level of trading activity by professional customers more resembles that of market makers and proprietary traders on the Exchange than it does of other customers. Currently, the primary distinction between the two types of customers is that Priority Customers take priority on the order book over professional customers. Professional customers are on parity with market makers and broker/dealers. However, professional customers generally do not pay transaction fees. Market makers and broker/dealers on the other hand pay transaction fees to the Exchange. Specifically, for market makers, the Exchange applies a sliding scale, between $0.01 and $0.18 per contract side, based on the number of contracts an ISE market maker trades in a month. Broker/dealer orders pay a flat execution fee of $0.20 per traded contract, regardless of whether they post liquidity to or take liquidity from ISE’s order book when they enter orders. Broker/dealer fees are posted on the Exchange’s fee schedule under the Firm Proprietary line item. The Exchange now proposes to adopt a $0.20 per contract execution fee for professional customers who execute orders as a result of posting liquidity to ISE’s order book. The proposed fee applies only to professional customer orders, i.e., non-broker/dealer customer orders; it does not apply to market maker and broker/dealer orders who, as noted above, already pay transaction fees. As discussed, professional customers engage in trading activity similar to that conducted by market makers and proprietary traders. For example, professional customers continue to join bids and offers on the Exchange and thus compete for incoming order flow. Professional customers do so in direct competition with ISE’s market makers, but with the distinct advantage of generally not paying transaction fees to the Exchange. ISE believes that adopting a ‘‘maker fee’’ for professional customers will put these market participants on a more equal footing with market makers and proprietary traders regarding fees paid for transacting on the Exchange. The Exchange further notes that the proposed fees, while comparable to fees currently paid by broker/dealer orders, are less than those fees as the Exchange is only proposing to charge professional customers who execute orders as a result of posting liquidity to ISE’s order E:\FR\FM\04FEN1.SGM 04FEN1 Federal Register / Vol. 75, No. 23 / Thursday, February 4, 2010 / Notices book. The Exchange is not currently proposing to charge professional customers a fee for taking liquidity from ISE’s order book. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Exchange Act,5 in general, and furthers the objectives of Section 6(b)(4),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. In particular, the proposed rule change will help equalize competition between market makers, proprietary traders and professional customers on the Exchange. B. Self-Regulatory Organization’s Statement on Burden on Competition The proposed rule change does not 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 has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties. 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) of the Act 7 and Rule 19b–4(f)(2) 8 thereunder. At any time within 60 days of the filing of such 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.9 srobinson on DSKHWCL6B1PROD with NOTICES IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule 5 15 U.S.C. 78f. U.S.C. 78f(b)(4). 7 15 U.S.C. 78s(b)(3)(A). 8 17 CFR 19b–4(f)(2). 9 The Commission considers the 60-day period within which the Commission may summarily abrogate the proposal pursuant to Section 19(b)(3)(C) of the Act, 15 U.S.C. 78s(b)(3)(C), to commence on January 27, 2010, the date ISE filed Amendment No. 2 to the proposal. 6 15 VerDate Nov<24>2008 17:31 Feb 03, 2010 Jkt 220001 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–ISE–2010–06 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–ISE–2010–06. 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,10 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 10:00 am and 3 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the ISE. 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–ISE–2010–06 and should be submitted on or before February 25, 2010. 10 The text of the proposed rule change is available on ISE’s Web site at https://www.ise.com, on the Commission’s Web site at https:// www.sec.gov, at ISE, and at the Commission’s Public Reference Room. PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 5827 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.11 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–2334 Filed 2–3–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–61438; File No. SR–Phlx– 2010–13] Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating To Amending Rule 1092, Obvious Errors and Catastrophic Errors January 28, 2010. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 2 thereunder, notice is hereby given that on January 26, 2010, NASDAQ OMX PHLX, Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been 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 amend Exchange Rule 1092, Obvious Errors and Catastrophic Errors, to adopt the ability to review transactions on the Exchange’s own motion. The text of the proposed rule change is available on the Exchange’s Web site at https://www.nasdaqtrader.com/ micro.aspx?id=PHLXRulefilings, 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 11 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\04FEN1.SGM 04FEN1

Agencies

[Federal Register Volume 75, Number 23 (Thursday, February 4, 2010)]
[Notices]
[Pages 5826-5827]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-2334]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61434; File No. SR-ISE-2010-06]


Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change, as Modified by Amendment No. 2 Thereto, Relating to Fee Changes

January 27, 2010.
    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 January 14, 2010, the International Securities Exchange, LLC 
(the ``Exchange'' or the ``ISE'') filed with the Securities and 
Exchange 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 January 27, 2010, ISE filed Amendment No. 1 
to the proposed rule change. On January 27, 2010, ISE withdrew 
Amendment No. 1 and filed Amendment No. 2 to the proposed rule 
change.\3\ 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\ Amendment No. 2 deleted a sentence in the purpose section of 
the filing and in Exhibit 1.
---------------------------------------------------------------------------

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

    The ISE is proposing to amend its Schedule of Fees. The text of the 
proposed rule change is available on the Exchange's Web site (https://www.ise.com), 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 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
    ISE proposes to amend its Schedule of Fees. Specifically, the 
Exchange proposes to adopt a $0.20 per contract execution fee for 
professional customers who execute orders as a result of posting 
liquidity to ISE's order book.
    ISE recently adopted a rule change to distinguish between Priority 
Customer Orders and Professional Orders.\4\ A Priority Customer is 
defined in ISE Rule 100(a)(37A) as a person or entity that is not a 
broker or dealer in securities, and does not place more than 390 orders 
in listed options per day on average during a calendar month for its 
own beneficial account(s). A Professional Order is defined in ISE Rule 
100(a)(37C) as an order that is for the account of a person or entity 
that is not a Priority Customer. For purpose of this discussion, 
``professional customers'' are non-broker/dealer participants who enter 
at least 390 orders per day on average during a calendar month for 
their own beneficial account(s). The level of trading activity by 
professional customers more resembles that of market makers and 
proprietary traders on the Exchange than it does of other customers.
---------------------------------------------------------------------------

    \4\ See Exchange Act Release No. 59287 (Jan. 23, 2009), 74 FR 
5694 (Jan. 30, 2009).
---------------------------------------------------------------------------

    Currently, the primary distinction between the two types of 
customers is that Priority Customers take priority on the order book 
over professional customers. Professional customers are on parity with 
market makers and broker/dealers. However, professional customers 
generally do not pay transaction fees. Market makers and broker/dealers 
on the other hand pay transaction fees to the Exchange. Specifically, 
for market makers, the Exchange applies a sliding scale, between $0.01 
and $0.18 per contract side, based on the number of contracts an ISE 
market maker trades in a month. Broker/dealer orders pay a flat 
execution fee of $0.20 per traded contract, regardless of whether they 
post liquidity to or take liquidity from ISE's order book when they 
enter orders. Broker/dealer fees are posted on the Exchange's fee 
schedule under the Firm Proprietary line item.
    The Exchange now proposes to adopt a $0.20 per contract execution 
fee for professional customers who execute orders as a result of 
posting liquidity to ISE's order book. The proposed fee applies only to 
professional customer orders, i.e., non-broker/dealer customer orders; 
it does not apply to market maker and broker/dealer orders who, as 
noted above, already pay transaction fees.
    As discussed, professional customers engage in trading activity 
similar to that conducted by market makers and proprietary traders. For 
example, professional customers continue to join bids and offers on the 
Exchange and thus compete for incoming order flow. Professional 
customers do so in direct competition with ISE's market makers, but 
with the distinct advantage of generally not paying transaction fees to 
the Exchange. ISE believes that adopting a ``maker fee'' for 
professional customers will put these market participants on a more 
equal footing with market makers and proprietary traders regarding fees 
paid for transacting on the Exchange.
    The Exchange further notes that the proposed fees, while comparable 
to fees currently paid by broker/dealer orders, are less than those 
fees as the Exchange is only proposing to charge professional customers 
who execute orders as a result of posting liquidity to ISE's order

[[Page 5827]]

book. The Exchange is not currently proposing to charge professional 
customers a fee for taking liquidity from ISE's order book.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Exchange Act,\5\ in general, 
and furthers the objectives of Section 6(b)(4),\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. In particular, the proposed rule change 
will help equalize competition between market makers, proprietary 
traders and professional customers on the Exchange.
---------------------------------------------------------------------------

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

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

    The proposed rule change does not 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 has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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) of the Act \7\ and Rule 19b-4(f)(2) \8\ thereunder. At any 
time within 60 days of the filing of such 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.\9\
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 19b-4(f)(2).
    \9\ The Commission considers the 60-day period within which the 
Commission may summarily abrogate the proposal pursuant to Section 
19(b)(3)(C) of the Act, 15 U.S.C. 78s(b)(3)(C), to commence on 
January 27, 2010, the date ISE filed Amendment No. 2 to the 
proposal.
---------------------------------------------------------------------------

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-ISE-2010-06 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-ISE-2010-06. 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,\10\ 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 10:00 am and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the ISE. 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-ISE-2010-06 and should be 
submitted on or before February 25, 2010.
---------------------------------------------------------------------------

    \10\ The text of the proposed rule change is available on ISE's 
Web site at https://www.ise.com, on the Commission's Web site at 
https://www.sec.gov, at ISE, and at the Commission's Public Reference 
Room.


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-2334 Filed 2-3-10; 8:45 am]
BILLING CODE 8011-01-P
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.