Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating to Billing Policies, 49544-49546 [2010-19971]
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49544
Federal Register / Vol. 75, No. 156 / Friday, August 13, 2010 / Notices
emcdonald on DSK2BSOYB1PROD with NOTICES
monthly fee of $5000. The Exchange
proposed to establish the same fees for
non-co-located customers with a 10Gb
circuit connection.4
NASDAQ represented that it also
already makes available to both colocated and non-co-located customers
direct connections capable of
supporting up to 1Gb, with per
connection monthly fees of $500 for colocated customers and $1000 for non colocated customers. According to the
Exchange, monthly fees are higher for
non-co-located customers because direct
connections require NASDAQ to
provide cabinet space and middleware
for those customers’ third-party vendors
to connect into the datacenter and,
ultimately, to the trading system.
Finally, the Exchange represented that
for non-co-located customers, it charges
an optional installation fee of $925 if the
customer chooses to use an on-site
router.
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.5 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(4) of the Act,6 which requires that
the rules of a national securities
exchange provide for the equitable
allocation of reasonable dues, fees and
other charges among its members and
issuers and other persons using its
facilities, and with Section 6(b)(5) of the
Act,7 which requires, among other
things, that the rules of a national
securities exchange be designed to
promote just and equitable principles of
trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system and, in general, to protect
investors and the public interest, and
not be designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers.
The Commission believes that the
proposed fees for 10Gb and 1Gb direct
circuit connections are reasonable and
equitably allocated insofar as they are
applied on the same terms to similarlysituated market participants. In
4 According to the Exchange, NASDAQ provides
an additional 1Gb copper connection option for colocated customers. NASDAQ represented that,
given the technological constraints of copper
connections over longer distances, it does not offer
a copper connection option to users outside of its
datacenter.
5 In approving this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
6 15 U.S.C. 78f(b)(4).
7 15 U.S.C. 78f(b)(5).
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addition, the Commission believes that
the connectivity options described in
the proposed rule change are not
unfairly discriminatory because
NASDAQ makes the 10Gb and 1Gb
direct circuit connections uniformly
available to all non-co-located
customers who voluntarily request them
and pay the fees as detailed in the
proposal. As represented by NASDAQ,
these fees are uniform for all such
customers and are either the same as
fees charged to co-located customers, or
vary due to different costs incurred by
NASDAQ associated with providing
service to the two different customer
types. Finally, the Commission believes
that the proposal will further the
protection of investors and the public
interest because it will provide greater
transparency regarding the connectivity
options available to market participants.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,8 that the
proposed rule change (SR–NASDAQ–
2010–077) be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–19972 Filed 8–12–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62661; File No. SR–Phlx–
2010–110]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NASDAQ
OMX PHLX, Inc. Relating to Billing
Policies
August 6, 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 August
4, 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, II
and III 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.
8 15
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
9 17
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend its
Fee Schedule to: (i) Require members
and member organizations to identify
accounts to properly identify joint backoffice (‘‘JBO’’) participant transactions;
(ii) specify certain policies to dispute
billing invoices; and (iii) amend the
index to rearrange the order of fees on
the Fee Schedule.
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, on the
Commission’s Web site at https://
www.sec.gov, 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 memorialize current
practices for the Exchange to clearly
identify orders that are not subject to the
Firm Related Equity Option Cap in
order to ensure that members and
member organizations are being
properly billed the Exchange fees and
also to modify the time requirements to
dispute Exchange dues and fees to
reduce the Exchange’s operational costs.
The Exchange proposes to memorialize
an existing process that requires
members and member organizations to
identify certain trades which are not
subject to the Firm Related Equity
Option Cap and to set concrete
timelines to dispute any assessed
Exchange dues and fees.
Currently, the Firms are subject to a
maximum fee of $75,000 also known as
the Firm Related Equity Option Cap.
Firm equity option transaction charges,
in the aggregate, for one billing month
cannot exceed the Firm Related Equity
E:\FR\FM\13AUN1.SGM
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Federal Register / Vol. 75, No. 156 / Friday, August 13, 2010 / Notices
emcdonald on DSK2BSOYB1PROD with NOTICES
Option Cap per member organization,
except for orders of JBO Participants.3
Therefore, Exchange accounts used for
JBO Participant orders are not subject to
the Firm Related Equity Option Cap.
The Exchange proposes to memorialize
the current practice of requiring
members and member organizations to
notify the Exchange in writing 4 and
indicate which accounts are used to
segregate orders of JBO participants
from other Firm orders. The Exchange
believes that memorializing the policy
within the Fee Schedule will eliminate
any confusion as to which orders are
JBO Participant orders and not subject
to the Firm Related Equity Option Cap.
Further the Exchange proposes to create
a new billing practice with respect to
JBO transactions. The Exchange
proposes to indicate on the Fee
Schedule that the Exchange will not
make any adjustments to billing
invoices where JBO transactions are
commingled with other Firm orders in
Exchange accounts, which are
designated by the member organization
as not subject to the Firm Related Equity
Option Cap. The Exchange believes that
this practice would not create an undue
burden on its members and/or member
organizations and would ensure a more
efficient billing process.
The Exchange also proposes to
establish a billing practice to prevent
members and member organizations
from disputing billing invoices after
sixty (60) days. The Exchange proposes
to state on its Fee Schedule that all
billing disputes must be submitted to
the Exchange in writing 5 and must be
accompanied by supporting
documentation. All disputes must be
submitted no later than sixty (60) days
after receipt of an Exchange invoice.
The Exchange proposes to exclude the
following types of fee disputes:
NASDAQ OMX PSX Fees, Proprietary
Data Feed Fees and Co-Location
Services Fees.6 The Exchange is
3 A JBO participant is a Member, Member
Organization or non-member organization that
maintains a JBO arrangement with a clearing
broker-dealer (‘‘JBO Broker’’) subject to the
requirements of Regulation T Section 220.7 of the
Federal Reserve System. See also Exchange Rule
703. JBO participant orders are not subject to the
Firm Related Equity Option Cap because the
Exchange is unable to differentiate orders of a JBO
participant from orders of its JBO Broker and
therefore is unable to aggregate the JBO
participant’s orders. JBO participant orders may
employ the F-account type and qualify for the Firm
charge, but are not eligible for the Monthly Firm
Cap.
4 The Exchange will issue an Options Regulatory
Alert to specify the proper Exchange contacts to
notify the Exchange.
5 The Exchange invoice specifies the Exchange
contact persons with whom to dispute the invoice.
6 These fees are not included in the reports
described in footnote 7.
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49545
excluding these types of fees because
these fees are billed separately to
Exchange members and Exchange
members do not have the same type of
notice as all other fees on the Fee
Schedule, as they do not receive reports
for certain fees. The Exchange believes
that members and member organizations
should be aware of any billing errors
within two months of receiving an
invoice.7 The Exchange further believes
that this practice will conserve
Exchange resources which are expended
when untimely billing disputes require
staff to research applicable fees and
order information beyond two months
after the transaction occurred.
Finally, the Exchange proposes to
rearrange its Fee Schedule to relocate
the Routing Fees and PSX Fees in the
Fee Schedule to eliminate sequential
numbering discrepancies in the Index
which arose when the Fee Schedule was
reformatted.
organizations are currently required to
properly account for these type of
orders. The proposal is equitable
because this practice will apply to all
members and member organizations
transacting JBO business.
Additionally, the Exchange believes
the requirement that all billing disputes
must be submitted within 60 days from
receipt of the invoice, with the
exception of certain fees, is reasonable
because the Exchange provides ample
tools to properly and swiftly monitor
and account for various charges
incurred in a given month. Also, the
proposal is equitable because it equally
applies to all members and member
organizations. The Exchange’s
administrative costs would also be
lowered as a result of this policy.
Finally the Exchange believes that the
proposal to rearrange the Fee Schedule
is both reasonable and equitable because
it clarifies the Fee Schedule.
2. Statutory Basis
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange believes that its
proposal to amend its Fee Schedule is
consistent with Section 6(b) of the Act 8
in general, and furthers the objectives of
Section 6(b)(4) of the Act 9 in particular,
in that it is an equitable allocation of
reasonable fees and other charges among
Exchange members. The Exchange
believes that the proposal to
memorialize the current practice
concerning JBO accounts is reasonable
to ensure that the Firm Related Equity
Option Cap is properly applied in
billing members and member
organizations. The Exchange believes
that the proposal is equitable because
the process of notifying the Exchange of
accounts used for JBO orders is
currently being employed and would
therefore not create an undue burden.
The Exchange believes that the
proposed amendment to billing
practices, the proposal to not adjust
commingled JBO orders, is reasonable
because members and member
7 The Exchange provides members and member
organizations the ability to sign-up to receive
certain daily reports (i.e. daily traded against report,
daily cancel fees, etc. * * *), which provides the
members and member organizations with trade data
to determine fees prior to receiving a billing
invoice. In addition, members and member
organizations have access to myphlx.com, a
password protected Web site, which provides
members an electronic copy of current and
historical invoices, as well as the supporting details
for assessed charges. Members will have the ability
to retrieve trade information from this Web site on
a T +1 basis no later than September 30, 2010 This
new enhancement will provide members and
member organizations the ability to see information
about their trades and billing information prior to
receiving the final month-end invoice.
8 15 U.S.C. 78f(b).
9 15 U.S.C. 78f(b)(4).
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Frm 00092
Fmt 4703
Sfmt 4703
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
No written comments were either
solicited or received.
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 Act 10 and
subparagraph (f) of Rule 19b–4 11
thereunder. At any time within 60 days
of the filing of the proposed rule change,
the Commission summarily may
temporarily suspend 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:
10 15
11 17
E:\FR\FM\13AUN1.SGM
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
13AUN1
49546
Federal Register / Vol. 75, No. 156 / Friday, August 13, 2010 / Notices
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–Phlx–2010–110 on the
subject line.
Paper Comments
emcdonald on DSK2BSOYB1PROD with NOTICES
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62670; File No. SR–
NYSEArca–2010–77]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NYSE
Arca, Inc. Amending Its Fee Schedule
August 9, 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 August
4, 2010, NYSE Arca, Inc. (‘‘NYSE Arca’’
All submissions should refer to File
or the ‘‘Exchange’’) filed with the
Number SR–Phlx–2010–110. This file
Securities and Exchange Commission
number should be included on the
(‘‘SEC’’ or ‘‘Commission’’) the proposed
subject line if e-mail is used. To help the rule change as described in Items I and
Commission process and review your
II below, which Items have been
comments more efficiently, please use
prepared by the Exchange. The
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
Internet Web site (https://www.sec.gov/
change from interested persons.
rules/sro.shtml). Copies of the
I. Self-Regulatory Organization’s
submission, all subsequent
Statement of the Terms of Substance of
amendments, all written statements
the Proposed Rule Change
with respect to the proposed rule
change that are filed with the
The Exchange proposes to amend its
Commission, and all written
Schedule of Fees and Charges for
communications relating to the
Exchange Services (the ‘‘Schedule’’).
proposed rule change between the
While changes to the Schedule pursuant
Commission and any person, other than to this proposal will be effective upon
those that may be withheld from the
filing, the changes will become
public in accordance with the
operative on August 4, 2010. The
provisions of 5 U.S.C. 552, will be
amended section of the Schedule is
available for Web site viewing and
included as Exhibit 5 to the 19b–4 form.
printing in the Commission’s Public
A copy of this filing is available on the
Reference Room, 100 F Street, NE.,
Exchange’s Web site at https://
Washington, DC 20549, on official
www.nyse.com, at the Exchange’s
business days between the hours of
principal office, on the Commission’s
10 a.m. and 3 p.m. Copies of the filing
Web site at https://www.sec.gov, and at
also will be available for inspection and the Commission’s Public Reference
copying at the principal office of the
Room.
Exchange. All comments received will
II. Self-Regulatory Organization’s
be posted without change; the
Statement of the Purpose of, and
Commission does not edit personal
Statutory Basis for, the Proposed Rule
identifying information from
Change
submissions. You should submit only
information that you wish to make
In its filing with the Commission, the
available publicly. All submissions
self-regulatory organization included
should refer to File Number SR–Phlx–
statements concerning the purpose of,
2010–110 and should be submitted on
and basis for, the proposed rule change
or before September 3, 2010.
and discussed any comments it received
on the proposed rule change. The text
For the Commission, by the Division of
of those statements may be examined at
Trading and Markets, pursuant to delegated
authority.12
the places specified in Item IV below.
The Exchange has prepared summaries,
Florence E. Harmon,
set forth in sections A, B, and C below,
Deputy Secretary.
of the most significant parts of such
[FR Doc. 2010–19971 Filed 8–12–10; 8:45 am]
statements.
BILLING CODE 8010–01–P
1 15
12 17
CFR 200.30–3(a)(12).
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16:35 Aug 12, 2010
2 17
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PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00093
Fmt 4703
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of this filing is to amend
the Schedule to reflect new transaction
pricing that will become operative on
August 4, 2010.
The Exchange proposes to eliminate
the fees charged to Firms that manually
facilitate their customer order flow.
Currently, all Firm proprietary manual
transactions are charged $0.18 per
contract and are further capped at
$2,000 per issue per day.
NYSE Arca proposes to eliminate fees
charged for any transaction involving a
Firm’s proprietary trading account that
has a customer of that same Firm on the
contra side of the transaction. Under the
revised Schedule, all such transactions,
known as Firm Facilitation—Manual
trades, will be subject to a rate of $0.00
per contract.
With the reduction of Firm
Facilitation—Manual trades to $0.00 the
transaction fee for all other Firm
proprietary manual trades will be $0.25
per contract. The fee for Firm
proprietary electronic transactions will
continue to be $0.50 per contract. Firm
transaction fees will be applied on the
same basis as all other Broker Dealer
transaction fees.
Additionally, there will no longer be
a daily cap on Firm proprietary manual
transactions in the same option class.
The fees for electronic complex
orders, where two complex orders trade
against each other, will be reduced to
$0.00 when the same Firm represents
both sides.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6(b) of the
Act,3 in general, and Section 6(b)(4) of
the Act,4 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.
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.
3 15
4 15
Sfmt 4703
E:\FR\FM\13AUN1.SGM
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
13AUN1
]]>Agencies
[Federal Register Volume 75, Number 156 (Friday, August 13, 2010)]
[Notices]
[Pages 49544-49546]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-19971]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62661; File No. SR-Phlx-2010-110]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating
to Billing Policies
August 6, 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 August 4, 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, II and III 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend its Fee Schedule to: (i) Require
members and member organizations to identify accounts to properly
identify joint back-office (``JBO'') participant transactions; (ii)
specify certain policies to dispute billing invoices; and (iii) amend
the index to rearrange the order of fees on the Fee Schedule.
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, on the Commission's Web site at
https://www.sec.gov, 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 memorialize current
practices for the Exchange to clearly identify orders that are not
subject to the Firm Related Equity Option Cap in order to ensure that
members and member organizations are being properly billed the Exchange
fees and also to modify the time requirements to dispute Exchange dues
and fees to reduce the Exchange's operational costs. The Exchange
proposes to memorialize an existing process that requires members and
member organizations to identify certain trades which are not subject
to the Firm Related Equity Option Cap and to set concrete timelines to
dispute any assessed Exchange dues and fees.
Currently, the Firms are subject to a maximum fee of $75,000 also
known as the Firm Related Equity Option Cap. Firm equity option
transaction charges, in the aggregate, for one billing month cannot
exceed the Firm Related Equity
[[Page 49545]]
Option Cap per member organization, except for orders of JBO
Participants.\3\ Therefore, Exchange accounts used for JBO Participant
orders are not subject to the Firm Related Equity Option Cap. The
Exchange proposes to memorialize the current practice of requiring
members and member organizations to notify the Exchange in writing \4\
and indicate which accounts are used to segregate orders of JBO
participants from other Firm orders. The Exchange believes that
memorializing the policy within the Fee Schedule will eliminate any
confusion as to which orders are JBO Participant orders and not subject
to the Firm Related Equity Option Cap. Further the Exchange proposes to
create a new billing practice with respect to JBO transactions. The
Exchange proposes to indicate on the Fee Schedule that the Exchange
will not make any adjustments to billing invoices where JBO
transactions are commingled with other Firm orders in Exchange
accounts, which are designated by the member organization as not
subject to the Firm Related Equity Option Cap. The Exchange believes
that this practice would not create an undue burden on its members and/
or member organizations and would ensure a more efficient billing
process.
---------------------------------------------------------------------------
\3\ A JBO participant is a Member, Member Organization or non-
member organization that maintains a JBO arrangement with a clearing
broker-dealer (``JBO Broker'') subject to the requirements of
Regulation T Section 220.7 of the Federal Reserve System. See also
Exchange Rule 703. JBO participant orders are not subject to the
Firm Related Equity Option Cap because the Exchange is unable to
differentiate orders of a JBO participant from orders of its JBO
Broker and therefore is unable to aggregate the JBO participant's
orders. JBO participant orders may employ the F-account type and
qualify for the Firm charge, but are not eligible for the Monthly
Firm Cap.
\4\ The Exchange will issue an Options Regulatory Alert to
specify the proper Exchange contacts to notify the Exchange.
---------------------------------------------------------------------------
The Exchange also proposes to establish a billing practice to
prevent members and member organizations from disputing billing
invoices after sixty (60) days. The Exchange proposes to state on its
Fee Schedule that all billing disputes must be submitted to the
Exchange in writing \5\ and must be accompanied by supporting
documentation. All disputes must be submitted no later than sixty (60)
days after receipt of an Exchange invoice. The Exchange proposes to
exclude the following types of fee disputes: NASDAQ OMX PSX Fees,
Proprietary Data Feed Fees and Co-Location Services Fees.\6\ The
Exchange is excluding these types of fees because these fees are billed
separately to Exchange members and Exchange members do not have the
same type of notice as all other fees on the Fee Schedule, as they do
not receive reports for certain fees. The Exchange believes that
members and member organizations should be aware of any billing errors
within two months of receiving an invoice.\7\ The Exchange further
believes that this practice will conserve Exchange resources which are
expended when untimely billing disputes require staff to research
applicable fees and order information beyond two months after the
transaction occurred.
---------------------------------------------------------------------------
\5\ The Exchange invoice specifies the Exchange contact persons
with whom to dispute the invoice.
\6\ These fees are not included in the reports described in
footnote 7.
\7\ The Exchange provides members and member organizations the
ability to sign-up to receive certain daily reports (i.e. daily
traded against report, daily cancel fees, etc. * * *), which
provides the members and member organizations with trade data to
determine fees prior to receiving a billing invoice. In addition,
members and member organizations have access to myphlx.com, a
password protected Web site, which provides members an electronic
copy of current and historical invoices, as well as the supporting
details for assessed charges. Members will have the ability to
retrieve trade information from this Web site on a T +1 basis no
later than September 30, 2010 This new enhancement will provide
members and member organizations the ability to see information
about their trades and billing information prior to receiving the
final month-end invoice.
---------------------------------------------------------------------------
Finally, the Exchange proposes to rearrange its Fee Schedule to
relocate the Routing Fees and PSX Fees in the Fee Schedule to eliminate
sequential numbering discrepancies in the Index which arose when the
Fee Schedule was reformatted.
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \8\ in general, and furthers
the objectives of Section 6(b)(4) of the Act \9\ in particular, in that
it is an equitable allocation of reasonable fees and other charges
among Exchange members. The Exchange believes that the proposal to
memorialize the current practice concerning JBO accounts is reasonable
to ensure that the Firm Related Equity Option Cap is properly applied
in billing members and member organizations. The Exchange believes that
the proposal is equitable because the process of notifying the Exchange
of accounts used for JBO orders is currently being employed and would
therefore not create an undue burden.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that the proposed amendment to billing
practices, the proposal to not adjust commingled JBO orders, is
reasonable because members and member organizations are currently
required to properly account for these type of orders. The proposal is
equitable because this practice will apply to all members and member
organizations transacting JBO business.
Additionally, the Exchange believes the requirement that all
billing disputes must be submitted within 60 days from receipt of the
invoice, with the exception of certain fees, is reasonable because the
Exchange provides ample tools to properly and swiftly monitor and
account for various charges incurred in a given month. Also, the
proposal is equitable because it equally applies to all members and
member organizations. The Exchange's administrative costs would also be
lowered as a result of this policy. Finally the Exchange believes that
the proposal to rearrange the Fee Schedule is both reasonable and
equitable because it clarifies the Fee Schedule.
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
No written comments were either solicited or received.
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 Act \10\ and subparagraph (f) of Rule 19b-4 \11\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend 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.
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\10\ 15 U.S.C. 78s(b)(3)(A)(ii).
\11\ 17 CFR 240.19b-4(f)(2).
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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 49546]]
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-Phlx-2010-110 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-Phlx-2010-110. 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 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-Phlx-2010-110 and should be
submitted on or before September 3, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-19971 Filed 8-12-10; 8:45 am]
BILLING CODE 8010-01-P
