Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Fee Schedule of the Boston Options Exchange Facility, 47869-47871 [2010-19607]
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Federal Register / Vol. 75, No. 152 / Monday, August 9, 2010 / Notices
Number SR–FINRA–2010–034 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper Comments
[Release No. 34–62632; File No. SR–BX–
2010–049]
• 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–FINRA–2010–034. 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 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
FINRA. 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–FINRA–2010–034 and
should be submitted on or before
August 30, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.46
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–19505 Filed 8–6–10; 8:45 am]
sroberts on DSKD5P82C1PROD with NOTICES
BILLING CODE 8010–01–P
Self-Regulatory Organizations;
NASDAQ OMX BX, Inc.; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change To Amend the
Fee Schedule of the Boston Options
Exchange Facility
August 3, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on July 16,
2010, NASDAQ OMX BX, Inc. (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the self-regulatory
organization. The Exchange filed the
proposed rule change pursuant to
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
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
Fee Schedule of the Boston Options
Exchange Group, LLC (‘‘BOX’’). 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
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)(ii).
4 17 CFR 240.19b–4(f)(2).
2 17
46 17
CFR 200.30–3(a)(12).
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47869
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
(a) Changes to Trading Fees:
The BOX Fee Schedule currently lists
certain execution fees as ‘standard’
trading fees, meaning that these
execution fees are not dependent upon
whether the transaction added or
removed liquidity on BOX.5 These
standard fees, specifically within
Sections 1–3 of the BOX Fee Schedule,
are applicable to certain Public
Customer PIP Improvement Orders,6
Broker Dealer proprietary accounts and
Market Maker accounts, respectively.
The standard fees are currently set at
$0.20 per contract executed for Broker
Dealer proprietary accounts and Market
Maker accounts. The Exchange proposes
to make the following adjustments to
trading fees effective Monday, July 19,
2010; with the exception of the Public
Customer Trading Fees, which will be
effective August 1, 2010:
Public Customer Trading Fees
The Exchange proposes to amend
Section 1 of the BOX Fee Schedule
relating to standard transaction fees
applicable to Public Customers.
Currently, except for non-CPO, there are
no standard trading fees for any Public
Customer Orders which may be
executed on BOX, including CPOs and
Public Customer Orders on the Book.7
The Exchange proposes to add to the
standard transaction fees for Public
Customer accounts a $0.25 per executed
contract charge for a Primary
Improvement Order for a Public
Customer and, effective August 1, 2010,
for all non-PIP transactions, a $0.10
charge per executed contract.8
Fees and Charges to SPY, QQQQ, and
IWM
Currently, the standard fee for
transactions in the Exchange Traded
Fund Shares (‘‘ETFs’’) Standard & Poor’s
Depositary Receipts® (‘‘SPY’’),
Powershares® QQQ Trust Series 1
(‘‘QQQQ’’) and iShares Russell 2000®
5 See Section 7 of the BOX Fee Schedule which
sets forth any applicable ‘liquidity fees and credits’.
6 According to Section 1 of the BOX Fee Schedule
a Public Customer is charged $0.15 per executed
contract of an Improvement Order on its behalf in
the PIP where that order is not submitted as a
Customer PIP Order (‘‘CPO’’) whereby it is labeled
as a ‘‘non-CPO’’.
7 Applicable charges and credits described in
Section 7 of the BOX Fee Schedule also apply to
Public Customer Orders.
8 The above fees are in addition to any applicable
charges and credits described in Section 7 of the
BOX Fee Schedule.
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Federal Register / Vol. 75, No. 152 / Monday, August 9, 2010 / Notices
Index Fund (‘‘IWM’’) are set at $0.10 per
contract for Broker Dealers and at $0.05
per contract for BOX Market Makers. In
addition, the credits and fees of Section
7 of the BOX Fee Schedule currently
apply equally for these three classes at
$0.05 for both the fees and credits. The
Exchange proposes to remove the
different fees for transactions in SPY,
QQQQ, and IWM throughout the BOX
Fee Schedule so that transactions in
these three classes will no longer be
treated separately from other classes.
Transactions in the PIP
Currently, the standard fee for
transactions within the PIP, including
transactions in SPY, QQQQ and IWM, is
set at $0.20 per contract, both for Broker
Dealers and for BOX Market Makers.
The Exchange proposes to amend
Sections 2 and 3 to raise the standard
transaction fee for PIP executions from
$0.20 to $0.25 both for Broker Dealers
and for BOX Market Makers.
Fees and Credits in Section 7
Currently, the existing credits and
fees within Section 7 for transactions in
the PIP are $0.15. These credits and fees
apply equally to all account types,
whether Public Customer, Broker Dealer
or Market Maker and are in addition to
any applicable trading fees, as described
in Sections 1 through 3 of the BOX Fee
Schedule. The Exchange proposes to
increase the existing credits and fees
within Section 7 for transactions in the
PIP, from $0.15 to $0.25.
Currently, the volume discount for the
fees charged to Initiating Participants
only applies to executions in PIP
auctions initiated by the particular
Initiating Participant which occur at a
price at least better than the NBBO and
after a threshold average daily volume
(‘‘ADV’’) of 50,000 contracts per month
is reached. Any PIP executions of the
Initiating Participant above this
threshold receive a $0.05 discount. The
Exchange proposes to replace the
volume discount with a per contract
execution fee based upon a tiered fee
schedule to apply to executions in PIP
auctions initiated by the particular
Initiating Participant.9 Each Initiating
Participant’s ADV for executions in PIP
auctions will be calculated. All PIP
executions by the Initiating Participant
for that month will be charged the same
per contract fee according to the
respective PIP auction ADV pursuant to
the following table:
Fee per
contract
Average daily volume for initiating participant
ADV
ADV
ADV
ADV
ADV
of
of
of
of
of
150,001 contracts and greater ..........................................................................................................................................
100,001 contracts to 150,000 contracts ...........................................................................................................................
50,001 contracts to 100,000 contracts .............................................................................................................................
20,001 contracts to 50,000 contracts ...............................................................................................................................
0 contracts to 20,000 contracts ........................................................................................................................................
This proposed tiered fee schedule is
designed to incent BOX Participants to
submit their Public Customer Orders
into the PIP for the possibility of price
improvement. As a BOX Participant’s
monthly PIP initiated trading volume
increases, the per-contract fee that an
Initiating Participant is charged for such
executions is decreased.
sroberts on DSKD5P82C1PROD with NOTICES
2. Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the
Act,10 in general, and Section 6(b)(5) of
the Act,11 in particular, as well as
Section 6(b) of the Act,12 in general, and
Section 6(b)(4) of the Act,13 in
particular, in that it provides for the
equitable allocation of reasonable dues,
fees, and other charges among its
members and issuers and other persons
using its facilities. In particular, the
proposed change will allow the fees
charged on BOX to remain competitive
with other exchanges as well as apply
such fees in a manner which is
equitable based upon the particular
account type, e.g. Public Customer,
Market Maker or Broker Dealer, for
9 This tiered fee schedule shall apply to the
standard transaction fee for PIP trades charged to
Public Customers pursuant to Section 1(b), BrokerDealers pursuant to Section 2(a) or Market Makers
pursuant to Section 3(a) of the Fee Schedule. For
example, a Broker-Dealer Primary Improvement
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which such transactions are executed.
The obligations of Public Customers,
Market Makers on BOX and Brokers
Dealers that execute transactions on
BOX are different. For example, BOX
Market Makers must maintain active
two-sided markets in options classes to
which they are assigned and also have
certain restrictions regarding trading
activity in classes outside of their
assignment, both of which do not apply
to Public Customers or Broker Dealers
on BOX.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has neither solicited
nor received comments on the proposed
rule change.
Order submitted by an Initiating Participant who
has reached the highest ADV tier of over 150,001
contracts executed in PIP auctions for the month
will be charged a $0.10 standard transaction fee
plus a provide liquidity fee of $0.25, for a total fee
of $0.35 on his Primary Improvement Order.
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$0.10
0.12
0.15
0.17
0.25
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act 14
and Rule 19b–4(f)(2) thereunder,15
because it establishes or changes a due,
fee, or other charge applicable only to a
member.
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may abrogate
the rule change if it appears to the
Commission that the action is necessary
or appropriate in the public interest, for
the protection of investors, or would
otherwise further 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:
10 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
12 15 U.S.C. 78f(b).
13 15 U.S.C. 78f(b)(4).
14 15 U.S.C. 78s(b)(3)(A)(ii).
15 17 CFR 240.19b–4(f)(2).
11 15
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Federal Register / Vol. 75, No. 152 / Monday, August 9, 2010 / Notices
Electronic Comment
• 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–2010–049 on the
subject line.
Paper Comment
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62629; File No. SR–
NASDAQ–2010–096]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing of a Proposed Rule Change
Relating to the National Quotation
Dissemination Service
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
August 3, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Florence E. Harmon,
Deputy Secretary.
NASDAQ is proposing to re-establish
retroactively through January 1, 2008,
the fee reduction pilot program under
NASDAQ Rule 7017(b) that reduced
from $50 to $10 the monthly fee that
non-professional users pay to receive
NQDS.
sroberts on DSKD5P82C1PROD with NOTICES
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on August 2,
2010, The NASDAQ Stock Market LLC
(‘‘NASDAQ’’ or ‘‘Exchange’’) filed with
All submissions should refer to File
the Securities and Exchange
Number SR–BX–2010–049. This file
Commission (‘‘Commission’’) the
number should be included on the
subject line if e-mail is used. To help the proposed rule change as described in
Items I and II below, which Items have
Commission process and review your
been prepared by NASDAQ. The
comments more efficiently, please use
only one method. The Commission will Commission is publishing this notice to
post all comments on the Commission’s solicit comments on the proposed rule
change from interested persons.
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
submission, all subsequent
the Proposed Rule Change
amendments, all written statements
with respect to the proposed rule
NASDAQ is proposing to amend
change that are filed with the
NASDAQ Rule 7017 to re-establish
Commission, and all written
retroactively through January 1, 2008, a
communications relating to the
pilot program under Nasdaq Rule
proposed rule change between the
7017(b), which reduced from $50 to $10
Commission and any person, other than the monthly fee that non-professional
those that may be withheld from the
users pay to receive the National
public in accordance with the
Quotation Dissemination Service
(‘‘NQDS’’).
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
II. Self-Regulatory Organization’s
printing in the Commission’s Public
Statement of the Purpose of, and
Reference Room, located at 100 F Street, Statutory Basis for, the Proposed Rule
NE., Washington, DC 20549, on official
Change
business days between the hours of 10
In its filing with the Commission,
a.m. and 3 p.m. Copies of such filing
also will be available for inspection and NASDAQ included statements
concerning the purpose of, and basis for,
copying at the principal office of the
the proposed rule change. The text of
Exchange. All comments received will
these statements may be examined at
be posted without change; the
the places specified in Item IV below,
Commission does not edit personal
and is set forth in Sections A, B, and C
identifying information from
below.
submissions. You should submit only
A. Self-Regulatory Organization’s
information that you wish to make
Statement of the Purpose of, and
available publicly. All submissions
Statutory Basis for, the Proposed Rule
should refer to File Number SR–BX–
Change
2010–049 and should be submitted on
or before August 30, 2010.
1. Purpose
[FR Doc. 2010–19607 Filed 8–6–10; 8:45 am]
BILLING CODE 8010–01–P
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
CFR 200.30–3(a)(12).
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Background
NASDAQ disseminates market data
feeds in two capacities. First, NASDAQ
disseminates consolidated or ‘‘core’’ data
in its capacity as Securities Information
Processor (‘‘SIP’’) for the national market
system plan governing securities listed
on NASDAQ as a national securities
exchange (‘‘NASDAQ UTP Plan’’).3 As
the SIP, NASDAQ disseminates the
NASDAQ Level 1 data entitlement
containing consolidated quotation and
last sale information from each selfregulatory organization (‘‘SRO’’) that
quotes or trades NASDAQ-listed
securities. NASDAQ collects revenue
derived from the sale of NASDAQ Level
1, deducts expenses incurred as the SIP,
and distributes the proceeds to the SROs
pursuant to the terms of the NASDAQ
UTP Plan.
Second, NASDAQ separately
disseminates proprietary or ‘‘non-core’’
data in its capacity as a registered
national securities exchange. Non-core
data is any data generated by the
NASDAQ Market Center Execution
System that is voluntarily disseminated
by NASDAQ. Non-core data is not
required to be supplied to the SIP for
inclusion in the consolidated data,
including quotation and last sale data
that is consolidated but which NASDAQ
can disseminate separate and apart from
the consolidated data.4 NASDAQ has
numerous proprietary data products,
such as NASDAQ TotalView, NASDAQ
Last Sale, and NASDAQ Basic. Revenue
from the sale of proprietary data
products is NASDAQ’s and is not
distributed pursuant to the NASDAQ
UTP Plan.
The National Quotation
Dissemination Service (‘‘NQDS’’) is a
proprietary data product that contains
the best bid and offer quotation of each
registered market maker quoting in
NASDAQ-listed securities on the
NASDAQ Stock Market. NQDS data is
used not only by firms, associated
persons, and other market professionals,
but also by non-professionals who
receive the service through authorized
vendors, including, for example, on-line
brokerage firms.
Prior to August 31, 2000, NQDS data
was available through authorized
vendors at a monthly rate of $50 for
professionals and non-professional
users alike. In August 2000, NASDAQ
filed a proposed rule change to reduce
from $50 to $10 the monthly fee that
non-professional users pay to receive
NQDS data. The Commission approved
the pilot on August 22, 2000, and the fee
3 See Securities Exchange Act Release No. 59039
(Dec. 2, 2008) at p. 41.
4 Id.
1 15
16 17
47871
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]]>Agencies
[Federal Register Volume 75, Number 152 (Monday, August 9, 2010)]
[Notices]
[Pages 47869-47871]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-19607]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62632; File No. SR-BX-2010-049]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend the
Fee Schedule of the Boston Options Exchange Facility
August 3, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on July 16, 2010, NASDAQ OMX BX, Inc. (the ``Exchange'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared by the self-regulatory organization. The Exchange filed
the proposed rule change pursuant to 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 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)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the Fee Schedule of the Boston
Options Exchange Group, LLC (``BOX''). 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 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
(a) Changes to Trading Fees:
The BOX Fee Schedule currently lists certain execution fees as
`standard' trading fees, meaning that these execution fees are not
dependent upon whether the transaction added or removed liquidity on
BOX.\5\ These standard fees, specifically within Sections 1-3 of the
BOX Fee Schedule, are applicable to certain Public Customer PIP
Improvement Orders,\6\ Broker Dealer proprietary accounts and Market
Maker accounts, respectively. The standard fees are currently set at
$0.20 per contract executed for Broker Dealer proprietary accounts and
Market Maker accounts. The Exchange proposes to make the following
adjustments to trading fees effective Monday, July 19, 2010; with the
exception of the Public Customer Trading Fees, which will be effective
August 1, 2010:
---------------------------------------------------------------------------
\5\ See Section 7 of the BOX Fee Schedule which sets forth any
applicable `liquidity fees and credits'.
\6\ According to Section 1 of the BOX Fee Schedule a Public
Customer is charged $0.15 per executed contract of an Improvement
Order on its behalf in the PIP where that order is not submitted as
a Customer PIP Order (``CPO'') whereby it is labeled as a ``non-
CPO''.
---------------------------------------------------------------------------
Public Customer Trading Fees
The Exchange proposes to amend Section 1 of the BOX Fee Schedule
relating to standard transaction fees applicable to Public Customers.
Currently, except for non-CPO, there are no standard trading fees for
any Public Customer Orders which may be executed on BOX, including CPOs
and Public Customer Orders on the Book.\7\ The Exchange proposes to add
to the standard transaction fees for Public Customer accounts a $0.25
per executed contract charge for a Primary Improvement Order for a
Public Customer and, effective August 1, 2010, for all non-PIP
transactions, a $0.10 charge per executed contract.\8\
---------------------------------------------------------------------------
\7\ Applicable charges and credits described in Section 7 of the
BOX Fee Schedule also apply to Public Customer Orders.
\8\ The above fees are in addition to any applicable charges and
credits described in Section 7 of the BOX Fee Schedule.
---------------------------------------------------------------------------
Fees and Charges to SPY, QQQQ, and IWM
Currently, the standard fee for transactions in the Exchange Traded
Fund Shares (``ETFs'') Standard & Poor's Depositary Receipts[reg]
(``SPY''), Powershares[reg] QQQ Trust Series 1 (``QQQQ'') and iShares
Russell 2000[reg]
[[Page 47870]]
Index Fund (``IWM'') are set at $0.10 per contract for Broker Dealers
and at $0.05 per contract for BOX Market Makers. In addition, the
credits and fees of Section 7 of the BOX Fee Schedule currently apply
equally for these three classes at $0.05 for both the fees and credits.
The Exchange proposes to remove the different fees for transactions in
SPY, QQQQ, and IWM throughout the BOX Fee Schedule so that transactions
in these three classes will no longer be treated separately from other
classes.
Transactions in the PIP
Currently, the standard fee for transactions within the PIP,
including transactions in SPY, QQQQ and IWM, is set at $0.20 per
contract, both for Broker Dealers and for BOX Market Makers. The
Exchange proposes to amend Sections 2 and 3 to raise the standard
transaction fee for PIP executions from $0.20 to $0.25 both for Broker
Dealers and for BOX Market Makers.
Fees and Credits in Section 7
Currently, the existing credits and fees within Section 7 for
transactions in the PIP are $0.15. These credits and fees apply equally
to all account types, whether Public Customer, Broker Dealer or Market
Maker and are in addition to any applicable trading fees, as described
in Sections 1 through 3 of the BOX Fee Schedule. The Exchange proposes
to increase the existing credits and fees within Section 7 for
transactions in the PIP, from $0.15 to $0.25.
Currently, the volume discount for the fees charged to Initiating
Participants only applies to executions in PIP auctions initiated by
the particular Initiating Participant which occur at a price at least
better than the NBBO and after a threshold average daily volume
(``ADV'') of 50,000 contracts per month is reached. Any PIP executions
of the Initiating Participant above this threshold receive a $0.05
discount. The Exchange proposes to replace the volume discount with a
per contract execution fee based upon a tiered fee schedule to apply to
executions in PIP auctions initiated by the particular Initiating
Participant.\9\ Each Initiating Participant's ADV for executions in PIP
auctions will be calculated. All PIP executions by the Initiating
Participant for that month will be charged the same per contract fee
according to the respective PIP auction ADV pursuant to the following
table:
---------------------------------------------------------------------------
\9\ This tiered fee schedule shall apply to the standard
transaction fee for PIP trades charged to Public Customers pursuant
to Section 1(b), Broker-Dealers pursuant to Section 2(a) or Market
Makers pursuant to Section 3(a) of the Fee Schedule. For example, a
Broker-Dealer Primary Improvement Order submitted by an Initiating
Participant who has reached the highest ADV tier of over 150,001
contracts executed in PIP auctions for the month will be charged a
$0.10 standard transaction fee plus a provide liquidity fee of
$0.25, for a total fee of $0.35 on his Primary Improvement Order.
------------------------------------------------------------------------
Average daily volume for initiating participant Fee per contract
------------------------------------------------------------------------
ADV of 150,001 contracts and greater................. $0.10
ADV of 100,001 contracts to 150,000 contracts........ 0.12
ADV of 50,001 contracts to 100,000 contracts......... 0.15
ADV of 20,001 contracts to 50,000 contracts.......... 0.17
ADV of 0 contracts to 20,000 contracts............... 0.25
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This proposed tiered fee schedule is designed to incent BOX
Participants to submit their Public Customer Orders into the PIP for
the possibility of price improvement. As a BOX Participant's monthly
PIP initiated trading volume increases, the per-contract fee that an
Initiating Participant is charged for such executions is decreased.
2. Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act,\10\ in general, and Section
6(b)(5) of the Act,\11\ in particular, as well as Section 6(b) of the
Act,\12\ in general, and Section 6(b)(4) of the Act,\13\ in particular,
in that it provides for the equitable allocation of reasonable dues,
fees, and other charges among its members and issuers and other persons
using its facilities. In particular, the proposed change will allow the
fees charged on BOX to remain competitive with other exchanges as well
as apply such fees in a manner which is equitable based upon the
particular account type, e.g. Public Customer, Market Maker or Broker
Dealer, for which such transactions are executed. The obligations of
Public Customers, Market Makers on BOX and Brokers Dealers that execute
transactions on BOX are different. For example, BOX Market Makers must
maintain active two-sided markets in options classes to which they are
assigned and also have certain restrictions regarding trading activity
in classes outside of their assignment, both of which do not apply to
Public Customers or Broker Dealers on BOX.
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\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(5).
\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(4).
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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
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act \14\ and Rule 19b-4(f)(2)
thereunder,\15\ because it establishes or changes a due, fee, or other
charge applicable only to a member.
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\14\ 15 U.S.C. 78s(b)(3)(A)(ii).
\15\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may abrogate the rule change if it
appears to the Commission that the action is necessary or appropriate
in the public interest, for the protection of investors, or would
otherwise further 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:
[[Page 47871]]
Electronic Comment
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-2010-049 on the subject line.
Paper Comment
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-2010-049. 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 Web site viewing and
printing in the Commission's Public Reference Room, located at 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 Number SR-BX-
2010-049 and should be submitted on or before August 30, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-19607 Filed 8-6-10; 8:45 am]
BILLING CODE 8010-01-P
