Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Establishing Strike Price Intervals for Options on Trust Issued Receipts, Including Holding Company Depositary Receipts, 51306-51308 [2010-20554]
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51306
Federal Register / Vol. 75, No. 160 / Thursday, August 19, 2010 / Notices
and Exchange Commission (‘‘SEC’’)
(each, an ‘‘Agency,’’ and collectively, the
‘‘Agencies’’).
ACTION: Notice of roundtable discussion;
request for comment.
On August 20, 2010,
commencing at 9 a.m. and ending at 12
p.m., staff of the Agencies will hold a
public roundtable discussion at which
invited participants will discuss
governance and conflicts of interest in
the context of certain authority that
Sections 726 and 765 of the Dodd-Frank
Wall Street Reform and Consumer
Protection Act (the ‘‘Act’’) granted to the
Agencies respectively. The discussion
will be open to the public with seating
on a first-come, first-served basis.
Members of the public may also listen
by telephone. Call-in participants
should be prepared to provide their first
name, last name, and affiliation. The
information for the conference call is set
forth below.
• U.S./Canada Toll-Free: (866) 312–
4390.
• International Toll: (404) 537–3379.
• Conference ID: 94280143.
A transcript of the public roundtable
discussion will be published on the
CFTC’s governance rulemaking page at
https://www.cftc.gov/LawRegulation/
OTCDerivatives/
OTC_9_DCOGovernance.html.
The roundtable discussion will take
place in Lobby Level Hearing Room
(Room 1000) at the CFTC’s headquarters
at Three Lafayette Centre, 1155 21st
Street, NW., Washington, DC.
FOR FURTHER INFORMATION CONTACT: The
CFTC’s Office of Public Affairs at (202)
418–5080 or the SEC’s Office of Public
Affairs at (202) 551–4120.
SUPPLEMENTARY INFORMATION: The
roundtable discussion will take place on
Friday, August 20, 2010, commencing at
9 a.m. and ending at 12 p.m. Members
of the public who wish to submit their
views on the topics addressed at the
discussion, or on any other topics
related to governance and conflicts of
interest in the context of the Act, may
do so via:
• Paper submission to David Stawick,
Secretary, Commodity Futures Trading
Commission, Three Lafayette Centre,
1155 21st Street, NW., Washington, DC
20581, or Elizabeth M. Murphy,
Secretary, Securities and Exchange
Commission, 100 F Street, NE.,
Washington, DC 20549–1090; or
• Electronic submission to the e-mail
address provided on the CFTC’s
governance rulemaking page (all e-mails
must reference ‘‘Dodd-Frank
Governance’’ in the subject field); and/
or by email to rule-comments@sec.gov
emcdonald on DSK2BSOYB1PROD with NOTICES
SUMMARY:
VerDate Mar<15>2010
17:05 Aug 18, 2010
Jkt 220001
or through the comment form available
at: https://www.sec.gov/news/press/2010/
2010–148.htm.
All submissions will be reviewed jointly
by the Agencies. All comments must be
in English or be accompanied by an
English translation. All submissions
provided to either Agency in any
electronic form or on paper will be
published on the Web site of the
respective Agency, without review and
without removal of personally
identifying information. Please submit
only information that you wish to make
publicly available.
Contracts Open for Trading) of the Rules
of the Boston Options Exchange Group,
LLC (‘‘BOX’’) to establish strike price
intervals for options on Trust Issued
Receipts (‘‘TIRs’’), including Holding
Company Depositary Receipts
(‘‘HOLDRs’’). The text of the proposed
rule change is available from the
principal office of the Exchange, on the
Commission’s Web site at https://
www.sec.gov, at the Commission’s
Public Reference Room and also on the
Exchange’s Internet Web site at https://
nasdaqomxbx.cchwallstreet.com/
NASDAQOMXBX/Filings/.
By the Securities and Exchange
Commission.
Dated: August 16, 2010.
Elizabeth M. Murphy,
Secretary.
By the Commodity Futures Trading
Commission.
Dated: August 16, 2010.
David A. Stawick,
Secretary.
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.
[FR Doc. 2010–20591 Filed 8–18–10; 8:45 am]
BILLING CODE 8010–01–P, 6351–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62719; File No. SR–BX–
2010–056]
Self-Regulatory Organizations;
NASDAQ OMX BX, Inc.; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change Relating to
Establishing Strike Price Intervals for
Options on Trust Issued Receipts,
Including Holding Company
Depositary Receipts
August 13, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’)1 and Rule 19b–4 thereunder,2
notice is hereby given that, on August
9, 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 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
NASDAQ OMX BX, Inc. (the
‘‘Exchange’’) proposes to amend Chapter
IV, Section 6 (Series of Options
1 15
2 17
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00069
Fmt 4703
Sfmt 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
Chapter IV, Section 6, Supplementary
Material .01 of the BOX Rules to allow
BOX to list options on Trust Issued
Receipts (‘‘TIRs’’), including Holding
Company Depository Receipts
(‘‘HOLDRs’’), in $1 or greater strike price
intervals, where the strike price is $200
or less, and $5 or greater where the
strike price is greater than $200.3
Currently, the strike price intervals for
options on TIRs are as follows: (1) $2.50
or greater where the strike price is $
25.00 or less; (2) $5.00 or greater where
the strike price is greater than $25.00;
and (3) $10.00 or greater where the
strike price is greater than $200.4
BOX is seeking to permit $1 strikes for
options on TIRs where the strike price
is less than $200 because TIRs have
characteristics similar to exchange
traded funds (‘‘ETFs’’). Specifically, TIRs
are exchange-listed securities
representing beneficial ownership of the
specific deposited securities represented
by the receipts. They are negotiable
3 HOLDRs are a type of TIR and the current
proposal would permit $1 strikes for options on
HOLDRS where the strike price is less than $200.
4 See Chapter IV, Section 6(d) of the BOX Rules.
E:\FR\FM\19AUN1.SGM
19AUN1
Federal Register / Vol. 75, No. 160 / Thursday, August 19, 2010 / Notices
receipts issued by a trust representing
securities of issuers that have been
deposited and held on behalf of the
holders of the TIRs. TIRs, which trade
in round-lots of 100, and multiples
thereof, may be issued after their initial
offering through a deposit with the
trustee of the required number of shares
of common stock of the underlying
issuers. This characteristic of TIRs is
similar to that of ETFs, which also may
be created on any business day upon
receipt of the requisite securities or
other investment assets comprising a
creation unit. The trust only issues
receipts upon the deposit of the shares
of the underlying securities that are
represented by a round-lot of 100
receipts. Likewise, the trust will cancel,
and an investor may obtain, hold, trade
or surrender TIRs in a round-lot and
round-lot multiples of 100 receipts.
Strike prices for ETF options are
permitted in $1 or greater intervals
where the strike price is $200 or less
and $5 or greater where the strike is
greater than $200. Accordingly, BOX
believes that the rationale for permitting
$1 strikes for ETF options equally
applies to permitting $1 strikes for
options on TIRs. BOX has analyzed its
capacity and believes the Exchange and
the Options Price Reporting Authority
(‘‘OPRA’’) have the necessary systems
capacity to handle the additional traffic
associated with the listing and trading
of $1 strikes where the strike price is
less than $200 for options on TIRs.
emcdonald on DSK2BSOYB1PROD with NOTICES
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the
Securities Exchange Act of 1934
(‘‘Exchange Act’’),5 in general, and
Section 6(b)(5) of the Exchange Act,6 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 national market
system and, in general, to protect
investors and the public interest. In
particular, BOX believes that the
marketplace and investors expect
options on TIRs to trade in a similar
manner to ETF options. BOX further
believes that investors will be better
served if $1 strike price intervals are
available for options on TIRs where the
strike price is less than $200.
5 15
6 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
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17:05 Aug 18, 2010
Jkt 220001
B. Self-Regulatory Organization’s
Statement on Burden on Competition
51307
IV. Solicitation of Comments
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
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
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
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) of the Act7 and Rule 19b–
4(f)(6) thereunder.8
The Exchange has requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiver of the operative delay is
consistent with the protection of
investors and the public interest
because the proposal is substantially
similar to a rule of another exchange
that has been approved by the
Commission.9 Therefore, the
Commission designates the proposal
operative upon filing.10
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.
7 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the self-regulatory organization
to submit to the Commission 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 of the proposed rule change, or such
shorter time as designated by the Commission. The
Exchange has satisfied the five-day pre-filing
requirement.
9 See Securities Exchange Release No. 34–62141
(May 20, 2010), 75 FR 29787 (May 27, 2010) (SR–
CBOE–2010–036).
10 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).
8 17
PO 00000
Frm 00070
Fmt 4703
Sfmt 4703
• 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–2010–056 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–2010–056. 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–BX–
2010–056 and should be submitted on
orbefore September 9, 2010.
11 17
E:\FR\FM\19AUN1.SGM
CFR 200.30–3(a)(12).
19AUN1
51308
Federal Register / Vol. 75, No. 160 / Thursday, August 19, 2010 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–20554 Filed 8–18–10; 8:45 am]
BILLING CODE 8010–01–P
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62712; File No. SR–CBOE–
2010–074]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposal
To Extend the Cut-Off Time To Submit
Contrary Exercise Advices
August 12, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on August
11, 2010, the Chicago Board Options
Exchange, Incorporated (‘‘Exchange’’ or
‘‘CBOE’’) filed with the Securities and
Exchange Commission (the
‘‘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
proposal as a ‘‘non-controversial’’
proposed rule change pursuant to
Section 19(b)(3)(A)(iii) of the Act3 and
Rule 19b–4(f)(6) thereunder.4 The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
CBOE proposes to amend Rule 11.1 to
extend the cut-off time to submit
contrary exercise advices. The text of
the rule proposal is available on the
Exchange’s website (https://
www.cboe.org/legal), at the Exchange’s
Office of the Secretary, and at the
Commission Public Reference Room.
emcdonald on DSK2BSOYB1PROD with NOTICES
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
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
1. Purpose
The purpose of the proposed rule
change is to amend Rule 11.1 to extend
the cut-off time to submit contrary
exercise advices (‘‘Contrary Exercise
Advice’’, or, ‘‘CEA’’)5 to the Exchange.
The Exchange also proposes to make
certain non-substantive changes to the
text of Rule 11.1 to more clearly present
the existing requirements.
The Options Clearing Corporation
(‘‘OCC’’) has an established procedure,
under OCC Rule 805, that provides for
the automatic exercise of certain options
that are in-the-money by a specified
amount known as ‘‘Exercise-byException’’ or ‘‘Ex-by-Ex.’’ Under the Exby-Ex process, options holders holding
option contracts that are in-the-money
by a requisite amount and who wish to
have their contracts automatically
exercised need take no further action.
However, under OCC Rule 805, option
holders who do not want their options
automatically exercised or who want
their options to be exercised under
different parameters than that of the Exby-Ex procedures must instruct OCC of
their ‘‘contrary intention.’’
In addition to and separate from the
OCC requirement, under Exchange Rule
11.1 option holders must file a CEA
with the Exchange notifying it of the
contrary intention. Rule 11.1 is
designed, in part, to deter individuals
from taking improper advantage of late
breaking news by requiring evidence of
an option holder’s timely decision to
exercise or not exercise expiring equity
options. Trading Permit Holders satisfy
this evidentiary requirement by
submitting a CEA form directly to the
Exchange, or by electronically
submitting the CEA to the Exchange
through OCC’s electronic
communications system. The
submission of the CEA allows the
Exchange to satisfy its regulatory
obligation to verify that the decision to
make a contrary exercise was made
timely and in accordance with Rule
11.1.
1 15
2 17
VerDate Mar<15>2010
17:05 Aug 18, 2010
5 Contrary Exercise Advices are also referred to as
Expiring Exercise Declarations (‘‘EED’’) in the OCC
rules.
Jkt 220001
PO 00000
Frm 00071
Fmt 4703
Sfmt 4703
Currently under Rule 11.1, option
holders have until 1 hour 28 6 minutes
following the time announced for the
close of trading on that day on the day
prior to expiration to make a final
decision to exercise or not exercise an
expiring option that would otherwise
either expire or be automatically
exercised. A Trading Permit Holder may
not accept CEA instructions from its
customer or non customer accounts after
1 hour 28 minutes. However, the current
rule gives Trading Permit Holders an
additional one hour, up to 2 hours 28
minutes, to submit these CEA
instructions to the Exchange where such
Trading Permit Holder uses an
electronic submission process.
The Exchange proposes to extend the
current deadline for submitting CEA
instructions to the Exchange by one
additional hour and 2 minutes, up to 3
hours 30 minutes following the time
announced for the close of trading on
that day for those Trading Permit
Holders who use an electronic
submission process.7 The Exchange
believes that this proposed rule change
is necessary to address concerns
expressed by Trading Permit Holders
that, given the decrease in the Ex-by-Ex
threshold and the increase in trading,
the existing deadline for submitting
CEAs to the Exchange is problematic for
timely back-office processing. The
proposed additional one hour and 2
minutes will address this concern by
further enabling firms to more timely
manage, process, and submit the
instructions to the Exchange.
It is important to note that this
proposed submission deadline does not
change the substantive requirement that
option holders make a final decision by
1 hour and 30 minutes following the
time announced for the close of trading
on that day. The Exchange will continue
to enforce the cut-off time to submit
CEAs, while also allowing additional
time to process and submit the CEAs.
This proposal seeks to increase that
additional submission time by one hour,
and the Exchange believes that this
proposal will be beneficial to the
marketplace, particularly as it concerns
back-office processing. The initiative to
6 CBOE is proposing to amend the current rule
relating to the deadline to make a final decision to
exercise or not exercise an expiring option from 1
hour 28 minutes to 1 hour 30 minutes following the
time announced for the close of trading on that day
to make it consistent with the current equity option
market close of trading (3:00 p.m. CT). See
Securities Exchange Act Release No. 34–53246
(February 7, 2007), SR–CBOE–2005–104, 71 FR
8014 (February 15, 2006) (Order approving
proposed change to amend Exchange Rules
governing the hours of trading in equity options and
narrow-based index options).
7 That time would be 6:30 P.M. Central Time.
E:\FR\FM\19AUN1.SGM
19AUN1
]]>Agencies
[Federal Register Volume 75, Number 160 (Thursday, August 19, 2010)]
[Notices]
[Pages 51306-51308]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-20554]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62719; File No. SR-BX-2010-056]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Relating to
Establishing Strike Price Intervals for Options on Trust Issued
Receipts, Including Holding Company Depositary Receipts
August 13, 2010.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'')\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that, on August 9, 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 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
NASDAQ OMX BX, Inc. (the ``Exchange'') proposes to amend Chapter
IV, Section 6 (Series of Options Contracts Open for Trading) of the
Rules of the Boston Options Exchange Group, LLC (``BOX'') to establish
strike price intervals for options on Trust Issued Receipts (``TIRs''),
including Holding Company Depositary Receipts (``HOLDRs''). The text of
the proposed rule change is available from the principal office of the
Exchange, on the Commission's Web site at https://www.sec.gov, 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
The purpose of this filing is to amend Chapter IV, Section 6,
Supplementary Material .01 of the BOX Rules to allow BOX to list
options on Trust Issued Receipts (``TIRs''), including Holding Company
Depository Receipts (``HOLDRs''), in $1 or greater strike price
intervals, where the strike price is $200 or less, and $5 or greater
where the strike price is greater than $200.\3\
---------------------------------------------------------------------------
\3\ HOLDRs are a type of TIR and the current proposal would
permit $1 strikes for options on HOLDRS where the strike price is
less than $200.
---------------------------------------------------------------------------
Currently, the strike price intervals for options on TIRs are as
follows: (1) $2.50 or greater where the strike price is $ 25.00 or
less; (2) $5.00 or greater where the strike price is greater than
$25.00; and (3) $10.00 or greater where the strike price is greater
than $200.\4\
---------------------------------------------------------------------------
\4\ See Chapter IV, Section 6(d) of the BOX Rules.
---------------------------------------------------------------------------
BOX is seeking to permit $1 strikes for options on TIRs where the
strike price is less than $200 because TIRs have characteristics
similar to exchange traded funds (``ETFs''). Specifically, TIRs are
exchange-listed securities representing beneficial ownership of the
specific deposited securities represented by the receipts. They are
negotiable
[[Page 51307]]
receipts issued by a trust representing securities of issuers that have
been deposited and held on behalf of the holders of the TIRs. TIRs,
which trade in round-lots of 100, and multiples thereof, may be issued
after their initial offering through a deposit with the trustee of the
required number of shares of common stock of the underlying issuers.
This characteristic of TIRs is similar to that of ETFs, which also may
be created on any business day upon receipt of the requisite securities
or other investment assets comprising a creation unit. The trust only
issues receipts upon the deposit of the shares of the underlying
securities that are represented by a round-lot of 100 receipts.
Likewise, the trust will cancel, and an investor may obtain, hold,
trade or surrender TIRs in a round-lot and round-lot multiples of 100
receipts.
Strike prices for ETF options are permitted in $1 or greater
intervals where the strike price is $200 or less and $5 or greater
where the strike is greater than $200. Accordingly, BOX believes that
the rationale for permitting $1 strikes for ETF options equally applies
to permitting $1 strikes for options on TIRs. BOX has analyzed its
capacity and believes the Exchange and the Options Price Reporting
Authority (``OPRA'') have the necessary systems capacity to handle the
additional traffic associated with the listing and trading of $1
strikes where the strike price is less than $200 for options on TIRs.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Securities Exchange Act of 1934
(``Exchange Act''),\5\ in general, and Section 6(b)(5) of the Exchange
Act,\6\ 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 national market system and, in general, to
protect investors and the public interest. In particular, BOX believes
that the marketplace and investors expect options on TIRs to trade in a
similar manner to ETF options. BOX further believes that investors will
be better served if $1 strike price intervals are available for options
on TIRs where the strike price is less than $200.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
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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
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 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) of the Act\7\ and Rule 19b-
4(f)(6) thereunder.\8\
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the self-regulatory organization to submit to the
Commission 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 of
the proposed rule change, or such shorter time as designated by the
Commission. The Exchange has satisfied the five-day pre-filing
requirement.
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The Exchange has requested that the Commission waive the 30-day
operative delay. The Commission believes that waiver of the operative
delay is consistent with the protection of investors and the public
interest because the proposal is substantially similar to a rule of
another exchange that has been approved by the Commission.\9\
Therefore, the Commission designates the proposal operative upon
filing.\10\
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\9\ See Securities Exchange Release No. 34-62141 (May 20, 2010),
75 FR 29787 (May 27, 2010) (SR-CBOE-2010-036).
\10\ 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).
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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:
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-2010-056 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-2010-056. 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-BX-2010-056 and should be
submitted on or before September 9, 2010.
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\11\ 17 CFR 200.30-3(a)(12).
[[Page 51308]]
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For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-20554 Filed 8-18-10; 8:45 am]
BILLING CODE 8010-01-P
