Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to CBOE's Marketing Fee Program, 78284-78285 [2010-31436]
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Federal Register / Vol. 75, No. 240 / Wednesday, December 15, 2010 / Notices
SECURITIES AND EXCHANGE
COMMISSION
and (C) below, of the most significant
aspects of such statements.
[Release No. 34–63470; File No. SR–CBOE–
2010–108]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to CBOE’s
Marketing Fee Program
December 8, 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 December
1, 2010, Chicago Board Options
Exchange, Incorporated (‘‘CBOE’’ or the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Exchange has
designated this proposal as one
establishing or changing a due, fee, or
other charge imposed by CBOE under
Section 19(b)(3)(A)(ii) of the Act 3 and
Rule 19b–4(f)(2) thereunder,4 which
renders the proposal effective upon
filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Chicago Board Options Exchange,
Incorporated (‘‘CBOE’’ or ‘‘Exchange’’)
proposes to amend its Fees Schedule
and specifically make certain changes to
its Marketing Fee Program. The text of
the proposed rule change is available on
the Exchange’s Web site (https://
www.cboe.org/legal), at the Exchange’s
Office of the Secretary and at the
Commission.
hsrobinson on DSK69SOYB1PROD 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,
CBOE 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. CBOE has prepared
summaries, set forth in sections (A), (B),
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
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19:10 Dec 14, 2010
Jkt 223001
1. Purpose
CBOE proposes to amend its
Marketing Fee Program in two respects.
First, CBOE proposes to amend the
types of transactions in which the fee is
assessed in the SPY option class.
Currently, the marketing fee is assessed
on transactions as set forth in footnote
6 of the Fees Schedule.5 In that regard,
CBOE notes that it is assessed on both
electronic and open outcry transactions.
CBOE now proposes to not assess the
marketing fee on electronic transactions
in SPY options, except that it would
continue to assess the marketing fee on
electronic transactions resulting from its
Automated Improvement Mechanism
(‘‘AIM ’’) pursuant to CBOE Rule 6.74A
and transactions in open outcry. CBOE
proposes to implement this change on a
pilot basis starting on December 1, 2010
and continuing through March 31, 2011.
This proposed change is intended to
attract more customer volume to the
Exchange in this option class and to
allow CBOE market-makers to better
compete for order flow. CBOE notes that
the SPY option class is unique in the
manner in which it trades and is one of
the most active option classes. CBOE
also notes that DPMs and Preferred
Market-Makers can utilize the marketing
fee funds to attract orders from payment
accepting firms that are executed in
AIM and in open outcry. Finally, CBOE
believes that the marketing fee funds
received by payment accepting firms
may be used to offset transaction and
other costs related to the execution of an
order in AIM and in open outcry,
including in the SPY option class. For
these reasons, CBOE believes that it
would make sense to continue to assess
the marketing fee in transactions
resulting from AIM and in open outcry
in the SPY option class, and would
5 In particular, the marketing fee is assessed only
on transactions of Market-Makers, e-DPMs, and
DPMs, resulting from (i) customer orders from
payment accepting firms, or (ii) customer orders
that have designated a ‘‘Preferred Market-Maker’’
under CBOE Rule 8.13. However, as described in
footnote 6, the marketing fee does not apply to:
Market-Maker-to-Market-Maker transactions
including transactions resulting from orders from
non-Trading Permit Holder market-makers;
transactions resulting from accommodation
liquidations (cabinet trades); and transactions
resulting from any of the strategies identified and/
or defined in footnote 13 of this Fees Schedule; and
transactions in the Penny Pilot classes resulting
from orders executed through the Hybrid Agency
Liaison under Rule 6.14.
PO 00000
Frm 00082
Fmt 4703
Sfmt 4703
assist in attracting customer volume to
the Exchange.
In addition, CBOE proposes to amend
its Marketing Fee Program to not assess
the fee in transactions in Flexible
Exchange Options (‘‘FLEX’’), which
CBOE believes may encourage MarketMakers to transact in FLEX options.
CBOE proposes to implement this
change to the marketing fee program
beginning on December 1, 2010. CBOE
is not amending its Marketing Fee
Program in any other respects.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with Section
6(b) of the Securities Exchange Act of
1934 (‘‘Act’’), 6 in general, and furthers
the objectives of Section 6(b)(4) 7 of the
Act in particular, in that it is designed
to provide for the equitable allocation of
reasonable dues, fees, and other charges
among its Trading Permit Holders and
other persons using its facilities in that
it is intended to attract more customer
volume on the Exchange in the SPY
option class and also to encourage
Market-Makers to transact in FLEX
options.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
CBOE does not believe that the
proposed rule change will impose any
burden on competition that is not
necessary or appropriate in furtherance
of [sic] 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 solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change establishes or changes a due, fee,
or other charge imposed by the
Exchange, it has become effective
pursuant to Section 19(b)(3)(A) of the
Act 8 and subparagraph (f)(2) of Rule
19b–4 9 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
6 15
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
8 15 U.S.C. 78s(b)(3)(A).
9 17 CFR 240.19b–4(f)(2).
7 15
E:\FR\FM\15DEN1.SGM
15DEN1
Federal Register / Vol. 75, No. 240 / Wednesday, December 15, 2010 / Notices
investors, or otherwise in furtherance of
the purposes of the Act.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
IV. Solicitation of Comments
Florence E. Harmon,
Deputy Secretary.
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:
[FR Doc. 2010–31436 Filed 12–14–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
[Release No. 34–63496; File No. SR–
NYSEArca–2010–114]
• 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–CBOE–2010–108 on the
subject line.
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending NYSE Arca
Equities Rule 7.11 To Extend the
Effective Date of the Pilot
December 9, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
• Send paper comments in triplicate
(‘‘Act’’)1, and Rule 19b–42 thereunder,
to Elizabeth M. Murphy, Secretary,
notice is hereby given that on December
Securities and Exchange Commission,
7, 2010, NYSE Arca, Inc. (‘‘NYSE Arca’’
100 F Street, NE., Washington, DC
or ‘‘Exchange’’) filed with the Securities
20549–1090.
and Exchange Commission (the
‘‘Commission’’) the proposed rule
All submissions should refer to File
change as described in Items I and II
Number SR–CBOE–2010–108. This file
below, which Items have been prepared
number should be included on the
by the Exchange. The Commission is
subject line if e-mail is used. To help the
publishing this notice to solicit
Commission process and review your
comments on the proposed rule change
comments more efficiently, please use
from interested persons.
only one method. The Commission will
post all comments on the Commission’s I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
Internet Web site (https://www.sec.gov/
the Proposed Rule Change
rules/sro.shtml). Copies of the
submission, all subsequent
The Exchange proposes to amend
amendments, all written statements
NYSE Arca Equities Rule 7.11 to extend
with respect to the proposed rule
the effective date of the pilot by which
change that are filed with the
such rule operates, which is currently
Commission, and all written
scheduled to expire on December 10,
communications relating to the
2010, until April 11, 2011. The text of
proposed rule change between the
the proposed rule change is available at
Commission and any person, other than the Exchange, the Commission’s Public
those that may be withheld from the
Reference Room, and https://
www.nyse.com.
public in accordance with the
provisions of 5 U.S.C. 552, will be
II. Self-Regulatory Organization’s
available for Web site viewing and
Statement of the Purpose of, and
printing in the Commission’s Public
Statutory Basis for, the Proposed Rule
Reference Room on official business
Change
days between the hours of 10 a.m. and
In its filing with the Commission, the
3 p.m. Copies of such filing also will be
self-regulatory organization included
available for inspection and copying at
statements concerning the purpose of,
the principal office of CBOE. All
and basis for, the proposed rule change
comments received will be posted
and discussed any comments it received
without change; the Commission does
on the proposed rule change. The text
not edit personal identifying
of those statements may be examined at
information from submissions. You
the places specified in Item IV below.
should submit only information that
The Exchange has prepared summaries,
you wish to make available publicly. All
set forth in sections A, B, and C below,
submissions should refer to File
Number SR–CBOE–2010–108 and
10 17 CFR 200.30–3(a)(12).
should be submitted on or before
1 15 U.S.C. 78s(b)(1).
January 5, 2011.
2 17 CFR 240.19b–4.
hsrobinson on DSK69SOYB1PROD with NOTICES
Paper Comments
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PO 00000
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Fmt 4703
Sfmt 4703
78285
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
NYSE Arca Equities Rule 7.11 to extend
the effective date of the pilot by which
such rule operates, which is currently
scheduled to expire on December 10,
2010,3 until April 11, 2011.
NYSE Arca Equities Rule 7.11
requires the Exchange to pause trading
in an individual security listed on the
Exchange if the price moves by 10% as
compared to prices of that security in
the preceding five-minute period during
a trading day, which period is defined
as a ‘‘Trading Pause.’’ The pilot was
developed and implemented as a
market-wide initiative by the Exchange
and other national securities exchanges
in consultation with the Commission
staff and is currently applicable to all
S&P 500 Index securities, Russell 1000
Index securities, and specified
exchange-traded products.4
The extension proposed herein would
allow the pilot to continue to operate
without interruption while the
Exchange, other national securities
exchanges and the Commission further
assess the effect of the pilot on the
marketplace or whether other initiatives
should be adopted in lieu of the current
pilot.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Securities Exchange Act of 1934
(the ‘‘Act’’),5 in general, and furthers the
objectives of Section 6(b)(5) of the Act,6
in particular, in that it is designed to
prevent fraudulent and manipulative
acts and practices, 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. The Exchange believes
that the change proposed herein meets
these requirements in that it promotes
uniformity across markets concerning
decisions to pause trading in a security
when there are significant price
movements. Additionally, extension of
3 See Securities Exchange Act Release No. 62252
(June 10, 2010), 75 FR 34186 (June 16, 2010) (SR–
NYSEArca–2010–41).
4 The Exchange notes that the other national
securities exchanges have adopted the pilot in
substantially similar form.
5 15 U.S.C. 78f(b).
6 15 U.S.C. 78f(b)(5).
E:\FR\FM\15DEN1.SGM
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]]>Agencies
[Federal Register Volume 75, Number 240 (Wednesday, December 15, 2010)]
[Notices]
[Pages 78284-78285]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-31436]
[[Page 78284]]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63470; File No. SR-CBOE-2010-108]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Relating to CBOE's Marketing Fee Program
December 8, 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 December 1, 2010, Chicago Board Options Exchange, Incorporated
(``CBOE'' or the ``Exchange'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by the Exchange.
The Exchange has designated this proposal as one establishing or
changing a due, fee, or other charge imposed by CBOE under Section
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\
which renders the proposal effective upon filing with the Commission.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\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
Chicago Board Options Exchange, Incorporated (``CBOE'' or
``Exchange'') proposes to amend its Fees Schedule and specifically make
certain changes to its Marketing Fee Program. The text of the proposed
rule change is available on the Exchange's Web site (https://www.cboe.org/legal), at the Exchange's Office of the Secretary and at
the Commission.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, CBOE 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. CBOE 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
CBOE proposes to amend its Marketing Fee Program in two respects.
First, CBOE proposes to amend the types of transactions in which the
fee is assessed in the SPY option class. Currently, the marketing fee
is assessed on transactions as set forth in footnote 6 of the Fees
Schedule.\5\ In that regard, CBOE notes that it is assessed on both
electronic and open outcry transactions. CBOE now proposes to not
assess the marketing fee on electronic transactions in SPY options,
except that it would continue to assess the marketing fee on electronic
transactions resulting from its Automated Improvement Mechanism (``AIM
'') pursuant to CBOE Rule 6.74A and transactions in open outcry. CBOE
proposes to implement this change on a pilot basis starting on December
1, 2010 and continuing through March 31, 2011.
---------------------------------------------------------------------------
\5\ In particular, the marketing fee is assessed only on
transactions of Market-Makers, e-DPMs, and DPMs, resulting from (i)
customer orders from payment accepting firms, or (ii) customer
orders that have designated a ``Preferred Market-Maker'' under CBOE
Rule 8.13. However, as described in footnote 6, the marketing fee
does not apply to: Market-Maker-to-Market-Maker transactions
including transactions resulting from orders from non-Trading Permit
Holder market-makers; transactions resulting from accommodation
liquidations (cabinet trades); and transactions resulting from any
of the strategies identified and/or defined in footnote 13 of this
Fees Schedule; and transactions in the Penny Pilot classes resulting
from orders executed through the Hybrid Agency Liaison under Rule
6.14.
---------------------------------------------------------------------------
This proposed change is intended to attract more customer volume to
the Exchange in this option class and to allow CBOE market-makers to
better compete for order flow. CBOE notes that the SPY option class is
unique in the manner in which it trades and is one of the most active
option classes. CBOE also notes that DPMs and Preferred Market-Makers
can utilize the marketing fee funds to attract orders from payment
accepting firms that are executed in AIM and in open outcry. Finally,
CBOE believes that the marketing fee funds received by payment
accepting firms may be used to offset transaction and other costs
related to the execution of an order in AIM and in open outcry,
including in the SPY option class. For these reasons, CBOE believes
that it would make sense to continue to assess the marketing fee in
transactions resulting from AIM and in open outcry in the SPY option
class, and would assist in attracting customer volume to the Exchange.
In addition, CBOE proposes to amend its Marketing Fee Program to
not assess the fee in transactions in Flexible Exchange Options
(``FLEX''), which CBOE believes may encourage Market-Makers to transact
in FLEX options. CBOE proposes to implement this change to the
marketing fee program beginning on December 1, 2010. CBOE is not
amending its Marketing Fee Program in any other respects.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) of the Securities Exchange Act of 1934 (``Act''), \6\ in
general, and furthers the objectives of Section 6(b)(4) \7\ of the Act
in particular, in that it is designed to provide for the equitable
allocation of reasonable dues, fees, and other charges among its
Trading Permit Holders and other persons using its facilities in that
it is intended to attract more customer volume on the Exchange in the
SPY option class and also to encourage Market-Makers to transact in
FLEX options.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
CBOE does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of [sic] 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 solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change establishes or changes a
due, fee, or other charge imposed by the Exchange, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and
subparagraph (f)(2) of Rule 19b-4 \9\ 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
[[Page 78285]]
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
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-CBOE-2010-108 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-CBOE-2010-108. 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 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
CBOE. 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-
CBOE-2010-108 and should be submitted on or before January 5, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------
\10\ 17 CFR 200.30-3(a)(12).
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-31436 Filed 12-14-10; 8:45 am]
BILLING CODE 8011-01-P
