Self-Regulatory Organizations; NASDAQ OMX BX, Inc., Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Permitting Concurrent Listing of $3.50 and $4 Strikes for Classes in the $0.50 Strike and $1 Strike Programs, 17802-17803 [2010-7839]

Download as PDF 17802 Federal Register / Vol. 75, No. 66 / Wednesday, April 7, 2010 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–61811; File No. SR–BX– 2010–025] Self-Regulatory Organizations; NASDAQ OMX BX, Inc., Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Permitting Concurrent Listing of $3.50 and $4 Strikes for Classes in the $0.50 Strike and $1 Strike Programs March 31, 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 March 30, 2010, NASDAQ OMX BX, Inc. (the ‘‘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 Exchange filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act,3 and Rule 19b–4(f)(6) thereunder,4 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. WReier-Aviles on DSKGBLS3C1PROD with NOTICES I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Supplementary Material .02 to Section 6 of Chapter IV (Series of Options Open for Trading) of the Rules of the Boston Options Exchange Group, LLC (‘‘BOX’’) to permit the concurrent listing of $3.50 and $4 strikes for classes that participate in both the $0.50 Strike and $1 Strike Price Programs. 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/. 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 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(6). 2 17 15:18 Apr 06, 2010 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose BOX recently implemented a rule change that permits strike price intervals of $0.50 for options on stocks trading at or below $3.00 (‘‘$0.50 Strike Price Program’’).5 As part of the filing to establish the $0.50 Strike Price Program, BOX contemplated that a class may be selected to participate in both the $0.50 Strike Price Program and the $1 Strike Price Program. Under the $1 Strike Price Program, new series with $1 intervals are not permitted to be listed within $0.50 of an existing $2.50 strike price in the same series, except that strike prices of $2 and $3 are permitted to be listed within $0.50 of a $2.50 strike price for classes also selected to participate in the $0.50 Strike Price Program.6 Under BOX’s existing rule, for classes selected to participate in both the $0.50 Strike Price Program and the $1 Strike Price Program, BOX may either: (a) List a $3.50 strike but not list a $4 strike; or (b) list a $4 strike but not list a $3.50 strike. For example, under the BOX’s current rules, if a $3.50 strike for an option class in both the $0.50 and $1 Strike Price Programs was listed, the next highest permissible strike price would be $5.00. Alternatively, if a $4 strike was listed, the next lowest permissible strike price would be $3.00. The intent of the $.50 Strike Price Program was to expand the ability of investors to hedge risks associated with stocks trading at or under $3 and to provide finer intervals of $0.50, beginning at $1 up to $3.50. As a result, BOX believes that the current filing is consistent with the purpose of the $0.50 Strike Price Program and will permit BOX to fill in any existing gaps resulting from having to choose whether to list a $3.50 or $4 strike for options classes in both the $0.50 and $1 Strike Price Programs. Therefore, the Exchange is submitting the current filing to permit the listing of concurrent $3.50 and $4 strikes for classes that are selected to participate in both the $0.50 Strike Price Program and 5 See Securities Exchange Act Release No. 60814 (October 13, 2009), 74 FR 53535 (October 19, 2009) (SR–BX–2009–063). 6 See Supplementary Material .02(b) to Section 6 of Chapter IV of the BOX Rules. 1 15 VerDate Nov<24>2008 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. Jkt 220001 PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 the $1 Strike Price Program. To effect this change, the Exchange is proposing to amend Supplementary Material .02(b) to Section 6 of Chapter IV of the BOX Rules by adding $4 to the strike prices of $2 and $3 currently permitted if a class participates in both the $0.50 Strike Price Program and the $1 Strike Price Program. The Exchange is also proposing to amend the current rule text to delete references to ‘‘$2.50 strike prices’’ (and the example utilizing $2.50 strike prices) and to replace those references with broader language, e.g., ‘‘existing strike prices’’. 2. Statutory Basis The Exchange believes that the proposal is consistent with the requirements of Section 6(b) of the Act,7 in general, and Section 6(b)(5) of the Act,8 in particular, in that it is designed to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism for a free and open market and a national market system and, in general, to protect investors and the public interest. In particular, the Exchange believes that permitting the listing of more granular strikes on options overlying lower priced securities will provide investors with greater flexibility by allowing them to establish positions that are better tailored to meet their investment objectives. 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 Because the foregoing proposed rule change does not significantly affect the protection of investors or the public interest, does not impose any significant burden on competition, and, by its 7 15 8 15 E:\FR\FM\07APN1.SGM U.S.C. 78f(b). U.S.C. 78f(b)(5). 07APN1 Federal Register / Vol. 75, No. 66 / Wednesday, April 7, 2010 / Notices terms, does not become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) 9 of the Act and Rule 19b– 4(f)(6) 10 thereunder. The Exchange provided the Commission with written notice of its 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 the proposed rule change. The Exchange has requested that the Commission waive the 30-day operative delay to permit the Exchange to compete with other exchanges whose rules permit concurrent listing of $3.50 and $4 strikes for classes similarly participating in both a $0.50 strike program and a $1 strike program. The Commission finds that waiver of the operative delay is consistent with the protection of investors and the public interest because such waiver will encourage fair competition among the exchanges. Therefore, the Commission designates the proposal operative upon filing.11 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: 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–BX–2010–025. 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,12 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 Web site viewing and printing 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 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– 2010–025 and should be submitted on or before April 28, 2010. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–7839 Filed 4–6–10; 8:45 am] BILLING CODE 8011–01–P 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–2010–025 on the subject line. WReier-Aviles on DSKGBLS3C1PROD with NOTICES Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 9 15 U.S.C. 78s(b)(3)(A). 10 17 CFR 240.19b–4(f)(6). 11 For 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. 78c(f). VerDate Nov<24>2008 15:18 Apr 06, 2010 Jkt 220001 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–61822; File No. SR–Phlx– 2010–47] Self-Regulatory Organizations; NASDAQ OMX PHLX, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Amendment of the Fee Schedule April 1, 2010. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 12 The text of the proposed rule change is available on the Commission’s Web site at https:// www.sec.gov/. 13 17 CFR 200.30–3(a)(12). PO 00000 Frm 00123 Fmt 4703 Sfmt 4703 17803 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on March 22, 2010, NASDAQ OMX PHLX, Inc. (‘‘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 prepared by the Exchange. Phlx has designated this proposal as one establishing or changing a member due, fee, or other charge imposed under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b– 4(f)(2) thereunder,4 which renders the proposal effective upon filing with the Commission. 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 the Exchange’s Fee Schedule to: (i) Increase the number of options to be included in the Exchange’s current schedule of transaction fees and rebates for adding and removing liquidity; (ii) increase the Sector Index Options Fees assessed on Registered Options Traders (on-floor) and Specialists from $.30 to $.35 and (iii) make other clarifying technical amendments to the Fee Schedule. While changes to the Fee Schedule pursuant to this proposal are effective upon filing, the Exchange has designated these changes to be operative for transactions settling on or after April 1, 2010. The text of the proposed rule change is available on the Exchange’s Web site at https://nasdaqtrader.com/ micro.aspx?id=PHLXfilings, at the principal office of the Exchange, at the Commission’s Public Reference Room, and on the Commission’s Web site at https://www.sec.gov. 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 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(ii). 4 17 CFR 240.19b–4(f)(2). 2 17 E:\FR\FM\07APN1.SGM 07APN1

Agencies

[Federal Register Volume 75, Number 66 (Wednesday, April 7, 2010)]
[Notices]
[Pages 17802-17803]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-7839]



[[Page 17802]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61811; File No. SR-BX-2010-025]


Self-Regulatory Organizations; NASDAQ OMX BX, Inc., Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating to 
Permitting Concurrent Listing of $3.50 and $4 Strikes for Classes in 
the $0.50 Strike and $1 Strike Programs

March 31, 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 March 30, 2010, NASDAQ OMX BX, Inc. (the ``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 Exchange filed the 
proposed rule change pursuant to Section 19(b)(3)(A) of the Act,\3\ and 
Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective 
upon filing with the Commission. 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).
    \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 Supplementary Material .02 to 
Section 6 of Chapter IV (Series of Options Open for Trading) of the 
Rules of the Boston Options Exchange Group, LLC (``BOX'') to permit the 
concurrent listing of $3.50 and $4 strikes for classes that participate 
in both the $0.50 Strike and $1 Strike Price Programs. 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/.

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 parts of such 
statements.

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

1. Purpose
    BOX recently implemented a rule change that permits strike price 
intervals of $0.50 for options on stocks trading at or below $3.00 
(``$0.50 Strike Price Program'').\5\ As part of the filing to establish 
the $0.50 Strike Price Program, BOX contemplated that a class may be 
selected to participate in both the $0.50 Strike Price Program and the 
$1 Strike Price Program. Under the $1 Strike Price Program, new series 
with $1 intervals are not permitted to be listed within $0.50 of an 
existing $2.50 strike price in the same series, except that strike 
prices of $2 and $3 are permitted to be listed within $0.50 of a $2.50 
strike price for classes also selected to participate in the $0.50 
Strike Price Program.\6\ Under BOX's existing rule, for classes 
selected to participate in both the $0.50 Strike Price Program and the 
$1 Strike Price Program, BOX may either: (a) List a $3.50 strike but 
not list a $4 strike; or (b) list a $4 strike but not list a $3.50 
strike. For example, under the BOX's current rules, if a $3.50 strike 
for an option class in both the $0.50 and $1 Strike Price Programs was 
listed, the next highest permissible strike price would be $5.00. 
Alternatively, if a $4 strike was listed, the next lowest permissible 
strike price would be $3.00. The intent of the $.50 Strike Price 
Program was to expand the ability of investors to hedge risks 
associated with stocks trading at or under $3 and to provide finer 
intervals of $0.50, beginning at $1 up to $3.50. As a result, BOX 
believes that the current filing is consistent with the purpose of the 
$0.50 Strike Price Program and will permit BOX to fill in any existing 
gaps resulting from having to choose whether to list a $3.50 or $4 
strike for options classes in both the $0.50 and $1 Strike Price 
Programs.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 60814 (October 13, 
2009), 74 FR 53535 (October 19, 2009) (SR-BX-2009-063).
    \6\ See Supplementary Material .02(b) to Section 6 of Chapter IV 
of the BOX Rules.
---------------------------------------------------------------------------

    Therefore, the Exchange is submitting the current filing to permit 
the listing of concurrent $3.50 and $4 strikes for classes that are 
selected to participate in both the $0.50 Strike Price Program and the 
$1 Strike Price Program. To effect this change, the Exchange is 
proposing to amend Supplementary Material .02(b) to Section 6 of 
Chapter IV of the BOX Rules by adding $4 to the strike prices of $2 and 
$3 currently permitted if a class participates in both the $0.50 Strike 
Price Program and the $1 Strike Price Program.
    The Exchange is also proposing to amend the current rule text to 
delete references to ``$2.50 strike prices'' (and the example utilizing 
$2.50 strike prices) and to replace those references with broader 
language, e.g., ``existing strike prices''.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\7\ in general, and Section 
6(b)(5) of the Act,\8\ in particular, in that it is designed to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism for a free and open market and a national market 
system and, in general, to protect investors and the public interest. 
In particular, the Exchange believes that permitting the listing of 
more granular strikes on options overlying lower priced securities will 
provide investors with greater flexibility by allowing them to 
establish positions that are better tailored to meet their investment 
objectives.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 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

    Because the foregoing proposed rule change does not significantly 
affect the protection of investors or the public interest, does not 
impose any significant burden on competition, and, by its

[[Page 17803]]

terms, does not become operative for 30 days from the date on which it 
was filed, or such shorter time as the Commission may designate, it has 
become effective pursuant to Section 19(b)(3)(A) \9\ of the Act and 
Rule 19b-4(f)(6) \10\ thereunder. The Exchange provided the Commission 
with written notice of its 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 the proposed rule 
change.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    The Exchange has requested that the Commission waive the 30-day 
operative delay to permit the Exchange to compete with other exchanges 
whose rules permit concurrent listing of $3.50 and $4 strikes for 
classes similarly participating in both a $0.50 strike program and a $1 
strike program. The Commission finds that waiver of the operative delay 
is consistent with the protection of investors and the public interest 
because such waiver will encourage fair competition among the 
exchanges. Therefore, the Commission designates the proposal operative 
upon filing.\11\
---------------------------------------------------------------------------

    \11\ For 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. 
78c(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, 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-2010-025 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-2010-025. 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,\12\ 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 Web site 
viewing and printing 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 
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-
2010-025 and should be submitted on or before April 28, 2010.
---------------------------------------------------------------------------

    \12\ The text of the proposed rule change is available on the 
Commission's Web site at https://www.sec.gov/.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-7839 Filed 4-6-10; 8:45 am]
BILLING CODE 8011-01-P
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