Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX LLC Relating to Complex Order Fees, 18274-18276 [2011-7730]
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mstockstill on DSKH9S0YB1PROD with NOTICES
18274
Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices
Act), as well as with Section 16(a) of the
Act and, if and when applicable,
Section 16(b) of the Act. Further, each
Insurance Fund will act in accordance
with the Commission’s interpretations
of the requirements of Section 16(a)
with respect to periodic elections of
directors/trustees and with whatever
rules the Commission may promulgate
thereto.
9. An Insurance Fund will make its
shares available to the VLI Accounts,
VA Accounts, and Plans at or about the
time it accepts any capital from its
investment adviser (or affiliates) or from
a general account of a Participating
Insurance Company.
10. Each Insurance Fund has notified,
or will notify, all Participants that
disclosure regarding potential risks of
mixed and shared funding may be
appropriate in VLI Account and VA
Account prospectuses or Plan
documents. Each Insurance Fund will
disclose, in its prospectus that: (a)
Shares of the Insurance Fund may be
offered to both VA Accounts and VLI
Accounts and, if applicable, to Plans, (b)
due to differences in tax treatment and
other considerations, the interests of
various Variable Contract owners
participating in the Insurance Fund and
the interests of Plan participants
investing in the Insurance Fund, if
applicable, may conflict, and (c) the
Insurance Fund’s Board will monitor
events in order to identify the existence
of any material irreconcilable conflicts
and to determine what action, if any,
should be taken in response to any such
conflicts.
11. If and to the extent Rule 6e–2 and
Rule 6e–3(T) under the Act are
amended, or Rule 6e–3 under the Act is
adopted, to provide exemptive relief
from any provision of the Act, or the
rules thereunder, with respect to mixed
or shared funding, on terms and
conditions materially different from any
exemptions granted in the order
requested in this Application, then each
Insurance Fund and/or Participating
Insurance Companies, as appropriate,
shall take such steps as may be
necessary to comply with Rules 6e–2 or
6e–3(T), as amended, or Rule 6e–3, to
the extent such rules are applicable.
12. Each Participant, at least annually,
shall submit to the Board of each
Insurance Fund such reports, materials
or data as the Board reasonably may
request so that the directors/trustees of
the Board may fully carry out the
obligations imposed upon the Board by
the conditions contained in this
Application. Such reports, materials and
data shall be submitted more frequently
if deemed appropriate by the Board of
an Insurance Fund. The obligations of
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the Participants to provide these reports,
materials and data to the Board, when
it so reasonably requests, shall be a
contractual obligation of all Participants
under their Participation Agreement
with the Insurance Fund.
13. All reports of potential or existing
conflicts received by the Board of each
Insurance Fund, and all Board action
with regard to determining the existence
of a conflict, notifying Participants of a
conflict and determining whether any
proposed action adequately remedies a
conflict, will be properly recorded in
the minutes of the Board or other
appropriate records, and such minutes
or other records shall be made available
to the Commission upon request.
14. Each Insurance Fund will not
accept a purchase order from a Plan if
such purchase would make the Plan an
owner of 10 percent or more of the net
assets of the Insurance Fund unless the
Plan executes an agreement with the
Insurance Fund governing participation
in the Insurance Fund that includes the
conditions set forth herein to the extent
applicable. A Plan will execute an
application containing an
acknowledgement of this condition at
the time of its initial purchase of shares.
15. Each Insurance Fund will make its
shares available through an Account at
or about the same time that the
Insurance Fund receives any seed
money from the general account of a
Participating Insurance Company.
Conclusion
For the reasons summarized above,
applicants assert that the requested
exemptions are appropriate in the
public interest and consistent with the
protection of investors and the purposes
fairly intended by the policy and
provisions of the Act.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011–7695 Filed 3–31–11; 8:45 am]
BILLING CODE 8011–01–P
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on March 21,
2011, NASDAQ OMX PHLX LLC (‘‘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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend its
Complex Order 3 Fees in Section I of its
Fee Schedule titled Rebates and Fees for
Adding and Removing Liquidity in
Select Symbols.
While changes to the Fee Schedule
pursuant to this proposal are effective
upon filing, the Exchange has
designated these changes to be operative
on April 1, 2011.
The text of the proposed rule change
is available on the Exchange’s Website
at https://nasdaqtrader.com/
micro.aspx?id=PHLXfilings, at the
principal office of the Exchange, 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.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–64137; File No. SR–Phlx–
2011–37]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NASDAQ
OMX PHLX LLC Relating to Complex
Order Fees
March 28, 2011.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
PO 00000
Frm 00131
Fmt 4703
Sfmt 4703
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 A Complex Order is any order involving the
simultaneous purchase and/or sale of two or more
different options series in the same underlying
security, priced at a net debit or credit based on the
relative prices of the individual components, for the
same account, for the purpose of executing a
particular investment strategy. Furthermore, a
Complex Order can also be a stock-option order,
which is an order to buy or sell a stated number
of units of an underlying stock or ETF coupled with
the purchase or sale of options contract(s). See
Exchange Rule 1080, Commentary .08(a)(i).
2 17
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Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices
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 amend Section I, Part B of
the Exchange’s Fee Schedule, titled
‘‘Complex Order’’ to pay a Customer
Complex Order Rebate for Adding
Liquidity of $0.25 per contract in certain
symbols, specifically options overlying:
(i) Standard and Poor’s Depositary
Receipts/SPDRs (‘‘SPY’’); 4 (ii) the
PowerShares QQQ Trust (‘‘QQQQ’’)®;
and Apple, Inc. (AAPL), in order to
attract additional Customer order flow
in those symbols.
Currently, the Exchange pays a $0.24
per contract Customer Complex Order
Rebate for Adding Liquidity in all Select
Symbols.5 The Exchange is proposing to
pay a $0.25 per contract Rebate for
Adding Liquidity for Customer Complex
Orders in only the following symbols:
SPY, QQQQ and AAPL. Other market
participants would not be entitled to the
Rebate for Adding Liquidity.6 The
Exchange would continue to pay
Customers a rebate of $0.24 per contract
for transacting a Customer Complex
Order in all other Select Symbols,
except SPY, QQQ and AAPL which
would receive the $0.25 per contract
rebate.
The Exchange does not propose to
amend the fees in Section I, Part A titled
‘‘Single contra-side order.’’
mstockstill on DSKH9S0YB1PROD with NOTICES
2. Statutory Basis
The Exchange believes that its
proposal to amend its Fee Schedule is
consistent with Section 6(b) of the Act 7
in general, and furthers the objectives of
Section 6(b)(4) of the Act 8 in particular,
in that it is an equitable allocation of
reasonable fees and other charges among
Exchange members. The Exchange also
believes that there is an equitable
allocation of reasonable rebates among
Exchange members.
The Exchange believes that it is
reasonable to only pay a Rebate for
Adding Liquidity to Customers because
this Customer rebate would attract
Customer order flow to the Exchange for
the benefit of all market participants.
4 SPY options are based on the SPDR exchangetraded fund (‘‘ETF’’), which is designed to track the
performance of the S&P 500 Index.
5 A list of all symbols subject to the Rebates and
Fees for Adding and Removing Liquidity are listed
in Section I of the Exchange’s Fee Schedule and
titled ‘‘Select Symbols.’’
6 The only market participant that receives a
Rebate for Adding Liquidity for Complex Orders
today is a Customer.
7 15 U.S.C. 78f(b).
8 15 U.S.C. 78f(b)(4).
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The Exchange believes that the proposal
is equitable because by paying a Rebate
for Adding Liquidity to Customers, all
market participants would benefit from
the increased liquidity which increased
Customer order flow would bring to the
Exchange.
Further, the Exchange believes that it
is reasonable to pay a different rebate for
transacting equity options in certain
symbols. NYSE Arca, Inc. (‘‘NYSE
Arca’’) pays an additional $.05 per
contract credit above the stated post
liquidity credit for electronic
transactions in options overlying SPY,
C, BAC, QQQQ, AAPL, IWM, XLF, GLD,
EEM, GE, UNG, FAZ, DIA, GDX, and
USO which are referred to as the
‘‘premium tier.’’ 9 The Exchange is
proposing to pay different rebates for
different symbols similar to the manner
in which NYSE Arca pays an additional
contract credit in certain symbols.
The Exchange believes that its
proposal to pay a higher rebate for
transactions in equity options in SPY,
QQQQ and AAPL, as compared to the
other Select Symbols, is equitable
because the Exchange would uniformly
pay the same rebates for all Customer
Complex Orders in these three symbols.
The Exchange operates in a highly
competitive market comprised of nine
U.S. options exchanges in which
sophisticated and knowledgeable
market participants can readily send
order flow to competing exchanges if
they deem fee levels at a particular
exchange to be excessive. The Exchange
believes that the Complex Order fees
and rebates it assesses must be
competitive with fees and rebates
assessed in place on other exchanges.
The Exchange believes that this
competitive marketplace impacts the
fees and rebates present on the
Exchange today and influences the
proposals set forth above.
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.
9 See
PO 00000
NYSE Arca’s Fee Schedule.
Frm 00132
Fmt 4703
Sfmt 4703
18275
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 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. If the Commission
takes such action, the Commission shall
institute proceedings to determine
whether the proposed rule should be
approved or disapproved.
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 rulecomments@sec.gov. Please include File
Number SR–Phlx-2011–37 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–2011–37. 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
10 15
E:\FR\FM\01APN1.SGM
U.S.C. 78s(b)(3)(A)(ii).
01APN1
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Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices
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 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–2011–37 and should
be submitted on or before April 22,
2011.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011–7730 Filed 3–31–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations; NYSE
Amex LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending NYSE Amex
Equities Rule 440B To Modify the
Exchange’s Procedures for Handling
Short Sale Orders During a Period
When the Short Sale Price Test
Restrictions of Rule 201 of Regulation
SHO Are in Effect
March 28, 2011.
mstockstill on DSKH9S0YB1PROD with NOTICES
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on March 25,
2011, NYSE Amex LLC (the ‘‘Exchange’’
or ‘‘NYSE Amex’’) 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
substantially prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
NYSE Amex Equities Rule 440B (Short
Sales) to modify the Exchange’s
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
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20:09 Mar 31, 2011
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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 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.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
[Release No. 34–64133; File No. SR–
NYSEAmex–2011–19]
11 17
procedures for handling short sale
orders during a period when the short
sale price test restrictions of Rule 201 of
Regulation SHO (‘‘Rule 201’’) 4 are in
effect (‘‘Short Sale Period’’). The text of
the proposed rule change is available at
the Exchange, the Commission’s Public
Reference Room, and https://
www.nyse.com.
1. Purpose
On February 26, 2010, the
Commission adopted amendments to
Rule 201 of Regulation SHO under the
Act.5 In order to implement the
provisions of revised Rule 201, the
Exchange amended NYSE Amex
Equities Rule 440B (Short Sales) to (1)
Establish procedures for the Exchange,
as a listing market, to determine that the
short sale price test restrictions of Rule
201 have been triggered for a covered
security, (2) establish the protocols for
the handling of short sale orders by the
Exchange, as a trading center, in the
event the short sale price test
restrictions of Rule 201 are triggered,
including establishing what types of
short sale orders will be re-priced to
achieve a ‘‘Permitted Price’’ (as defined
and calculated in Rule 440B(e)), in
accordance with Rule 201, during a
Short Sale Period, (3) establish the
Exchange’s procedures regarding the
execution and display of permissible
orders during a Short Sale Period, and
the execution and display of orders
marked ‘‘short exempt’’ during such a
period, (4) establish the Exchange’s
4 17
CFR 242.201.
Securities Exchange Act Release No. 61595
(February 26, 2010), 75 FR 11232 (March 10, 2010)
(File No. S7–08–09; Amendments to Regulation
SHO) (‘‘Rule 201 Adopting Release’’). In the Rule
201 Adopting Release, the Commission also
adopted amendments to Rule 200(g) of Regulation
SHO to include a ‘‘short exempt’’ marking
requirement. 17 CFR 242.200(g).
5 See
PO 00000
Frm 00133
Fmt 4703
Sfmt 4703
procedures regarding the permissible
execution price of short sale orders in
single-priced opening, re-opening and
closing transactions during a Short Sale
Period, and (5) provide that, during a
Short Sale Period, Exchange systems
will not execute or display a short sale
order with respect to that security at a
price that is less than or equal to the
current national best bid (except as
otherwise provided in Rule 440B and
consistent with Rule 201).6
Under Rule 440B(e), during a Short
Sale Period, short sale orders that are
limited to the national best bid or lower
and short sale market orders will be repriced by Exchange systems one
minimum price increment above the
current national best bid to permit their
execution at a price that is compliant
with the short sale price test restrictions
of Rule 201. Consistent with Rule 201,7
the Permitted Price for securities for
which the national best bid is $1 or
more is $.01 above the national best bid;
the Permitted Price for securities for
which the national best bid is below $1
is $.0001 above the national best bid.8
Among other things, Rule 440B(f)
implements Rule 201(b)(1)(iii)(A),
which provides that a trading center
must have policies and procedures
reasonably designed to permit the
execution of a displayed short sale order
of a covered security if, at the time of
the initial display of the short sale
order, the order was at a price above the
current national best bid. Rule 440B(f)
specifically provides that the Exchange
will execute and display a short sale
order without regard to price if, at the
time of the initial display of the short
sale order, the order was at a price
above the then current national best bid.
The Exchange proposes to amend
Rule 440B(e) to provide for how
Exchange systems will treat short sale
orders that are not marked ‘‘short
exempt’’ during a Short Sale Period, i.e.,
displayed short sale orders pursuant to
Rule 440B(f) or non-marketable
displayable or non-displayed short sale
orders that Exchange systems have not
yet re-priced pursuant to Rule 440B(e),
and that would be required to be routed
to a protected bid pursuant to
Regulation NMS, which, by definition,
would be the national best bid or lower.
An example of a situation where
Exchange systems would otherwise be
required to route to the national best bid
includes the following: (1) A short sale
order is displayed pursuant to Rule
6 See Securities Exchange Act Release No. 63974
(February 25, 2011), 76 FR 12198 (March 4, 2011)
(SR–NYSEAmex–2011-08).
7 See Rule 201 Adopting Release at 11247.
8 17 CFR 242.612.
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]]>Agencies
[Federal Register Volume 76, Number 63 (Friday, April 1, 2011)]
[Notices]
[Pages 18274-18276]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-7730]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64137; File No. SR-Phlx-2011-37]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX LLC Relating
to Complex Order Fees
March 28, 2011.
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 March 21, 2011, NASDAQ OMX PHLX LLC (``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 Complex Order \3\ Fees in
Section I of its Fee Schedule titled Rebates and Fees for Adding and
Removing Liquidity in Select Symbols.
---------------------------------------------------------------------------
\3\ A Complex Order is any order involving the simultaneous
purchase and/or sale of two or more different options series in the
same underlying security, priced at a net debit or credit based on
the relative prices of the individual components, for the same
account, for the purpose of executing a particular investment
strategy. Furthermore, a Complex Order can also be a stock-option
order, which is an order to buy or sell a stated number of units of
an underlying stock or ETF coupled with the purchase or sale of
options contract(s). See Exchange Rule 1080, Commentary .08(a)(i).
---------------------------------------------------------------------------
While changes to the Fee Schedule pursuant to this proposal are
effective upon filing, the Exchange has designated these changes to be
operative on April 1, 2011.
The text of the proposed rule change is available on the Exchange's
Website at https://nasdaqtrader.com/micro.aspx?id=PHLXfilings, at the
principal office of the Exchange, 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.
[[Page 18275]]
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 amend Section I, Part
B of the Exchange's Fee Schedule, titled ``Complex Order'' to pay a
Customer Complex Order Rebate for Adding Liquidity of $0.25 per
contract in certain symbols, specifically options overlying: (i)
Standard and Poor's Depositary Receipts/SPDRs (``SPY''); \4\ (ii) the
PowerShares QQQ Trust (``QQQQ'')[reg]; and Apple, Inc. (AAPL), in order
to attract additional Customer order flow in those symbols.
---------------------------------------------------------------------------
\4\ SPY options are based on the SPDR exchange-traded fund
(``ETF''), which is designed to track the performance of the S&P 500
Index.
---------------------------------------------------------------------------
Currently, the Exchange pays a $0.24 per contract Customer Complex
Order Rebate for Adding Liquidity in all Select Symbols.\5\ The
Exchange is proposing to pay a $0.25 per contract Rebate for Adding
Liquidity for Customer Complex Orders in only the following symbols:
SPY, QQQQ and AAPL. Other market participants would not be entitled to
the Rebate for Adding Liquidity.\6\ The Exchange would continue to pay
Customers a rebate of $0.24 per contract for transacting a Customer
Complex Order in all other Select Symbols, except SPY, QQQ and AAPL
which would receive the $0.25 per contract rebate.
---------------------------------------------------------------------------
\5\ A list of all symbols subject to the Rebates and Fees for
Adding and Removing Liquidity are listed in Section I of the
Exchange's Fee Schedule and titled ``Select Symbols.''
\6\ The only market participant that receives a Rebate for
Adding Liquidity for Complex Orders today is a Customer.
---------------------------------------------------------------------------
The Exchange does not propose to amend the fees in Section I, Part
A titled ``Single contra-side order.''
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \7\ in general, and furthers
the objectives of Section 6(b)(4) of the Act \8\ in particular, in that
it is an equitable allocation of reasonable fees and other charges
among Exchange members. The Exchange also believes that there is an
equitable allocation of reasonable rebates among Exchange members.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Exchange believes that it is reasonable to only pay a Rebate
for Adding Liquidity to Customers because this Customer rebate would
attract Customer order flow to the Exchange for the benefit of all
market participants. The Exchange believes that the proposal is
equitable because by paying a Rebate for Adding Liquidity to Customers,
all market participants would benefit from the increased liquidity
which increased Customer order flow would bring to the Exchange.
Further, the Exchange believes that it is reasonable to pay a
different rebate for transacting equity options in certain symbols.
NYSE Arca, Inc. (``NYSE Arca'') pays an additional $.05 per contract
credit above the stated post liquidity credit for electronic
transactions in options overlying SPY, C, BAC, QQQQ, AAPL, IWM, XLF,
GLD, EEM, GE, UNG, FAZ, DIA, GDX, and USO which are referred to as the
``premium tier.'' \9\ The Exchange is proposing to pay different
rebates for different symbols similar to the manner in which NYSE Arca
pays an additional contract credit in certain symbols.
---------------------------------------------------------------------------
\9\ See NYSE Arca's Fee Schedule.
---------------------------------------------------------------------------
The Exchange believes that its proposal to pay a higher rebate for
transactions in equity options in SPY, QQQQ and AAPL, as compared to
the other Select Symbols, is equitable because the Exchange would
uniformly pay the same rebates for all Customer Complex Orders in these
three symbols.
The Exchange operates in a highly competitive market comprised of
nine U.S. options exchanges in which sophisticated and knowledgeable
market participants can readily send order flow to competing exchanges
if they deem fee levels at a particular exchange to be excessive. The
Exchange believes that the Complex Order fees and rebates it assesses
must be competitive with fees and rebates assessed in place on other
exchanges. The Exchange believes that this competitive marketplace
impacts the fees and rebates present on the Exchange today and
influences the proposals set forth above.
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\ 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. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
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\10\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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:
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-2011-37 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-2011-37. 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
[[Page 18276]]
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
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-2011-37 and should be submitted on or before April 22, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-7730 Filed 3-31-11; 8:45 am]
BILLING CODE 8011-01-P
