Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX LLC Relating to Inactive Nominees and Dividend and Merger Strategy Definitions, 18587-18589 [2011-7814]
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Federal Register / Vol. 76, No. 64 / Monday, April 4, 2011 / Notices
only during those portions of the
meeting that are open to the public.
Detailed procedures for the conduct of
and participation in ACRS meetings
were published in the Federal Register
on October 21, 2010, (75 FR 65038–
65039).
Detailed meeting agendas and meeting
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suspended for the period from 9:30 a.m.
EDT on March 31, 2011, through 11:59
p.m. EDT on April 13, 2011.
By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–8038 Filed 3–31–11; 4:15 pm]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–64141; File No. SR–Phlx–
2011–32]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NASDAQ
OMX PHLX LLC Relating to Inactive
Nominees and Dividend and Merger
Strategy Definitions
March 29, 2011.
[File No. 500–1]
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 24,
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.
In the Matter of Corestream Energy,
Inc. (f/k/a Zealous, Inc.); Order of
Suspension of Trading
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Dated: March 29, 2011.
Yoira Diaz-Sanabria,
Reactor Safety Branch B, Advisory Committee
on Reactor Safeguards.
[FR Doc. 2011–7889 Filed 4–1–11; 8:45 am]
BILLING CODE 7590–01–P
SECURITIES AND EXCHANGE
COMMISSION
Emcdonald on DSK2BSOYB1PROD with NOTICES
March 31, 2011.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Corestream
Energy, Inc. (‘‘Corestream’’) (f/k/a
Zealous, Inc.) because it has failed to
file certain periodic reports with the
Commission and because of questions
regarding the accuracy and adequacy of
statements made by Corestream in press
releases concerning, among other things,
the acquisition of certain oil wells.
Corestream is quoted on OTC Link
(previously the Pink Sheets) operated by
OTC Markets Group, Inc. under the
ticker symbol ‘‘ZLUS.’’
The Commission is of the opinion that
the public interest and the protection of
investors require a suspension of trading
in the securities of the above-listed
company.
Therefore, it is ordered, pursuant to
Section 12(k) of the Securities Exchange
Act of 1934, that trading in the
securities of the above-listed company is
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The Exchange proposes to amend the
Exchange’s Fee Schedule to apply the
Trading Floor Personnel Registration
Fee to Inactive Nominees.3 In addition,
the Exchange is proposing to amend the
dividend and merger strategy text in the
Exchange’s Fee Schedule to add
specificity to those definitions.
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.
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 The term ‘‘inactive nominee’’ means a natural
person associated with and designated as such by
a member organization and who has been approved
for such status and is registered as such with the
Membership Department. An inactive nominee
shall have no rights or privileges under a permit
unless and until said inactive nominee becomes
admitted as a member of the Exchange pursuant to
the By-Laws and Rules of the Exchange. An inactive
nominee merely stands ready to exercise rights
under a permit upon notice by the member
organization to the Membership Department on an
expedited basis. See Exchange Rule 1(i).
2 17
PO 00000
Frm 00078
Fmt 4703
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18587
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, 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 amend the Exchange’s Fee
Schedule to provide that an Inactive
Nominee must pay the Trading Floor
Personnel Registration Fee in order to
recover certain administrative expenses
associated with Inactive Nominees. An
Inactive Nominee’s status requires
additional administration because the
Inactive Nominee is also deemed a clerk
for the purpose of Exchange Rule 1090.
Pursuant to By-Law Article X, Section
12–10, to be eligible as an Inactive
Nominee, an individual must be
approved as eligible to hold a permit in
accordance with the Exchange’s ByLaws and Rules. An Inactive Nominee
does not have any rights or privileges of
a permit holder unless and until the
Inactive Nominee becomes an effective
permit holder and all applicable
Exchange fees are paid.4
The Inactive Nominee allows a
member to have additional flexibility in
obtaining coverage on the trading floor.
An Inactive Nominee stands ready to
assume a membership upon notice by
the member requesting that a specific
permit be transferred intra-firm on an
expedited and temporary basis. This
transfer allows an Inactive Nominee to
become an effective member of the
4 An Inactive Nominee is currently required to
pay $500 every 6 months for the privilege of
maintaining an Inactive Nominee Status. See the
Inactive Nominee Fee on the Exchange’s Fee
Schedule. See also Exchange By-Law Article X,
Section 12–10.
E:\FR\FM\04APN1.SGM
04APN1
18588
Federal Register / Vol. 76, No. 64 / Monday, April 4, 2011 / Notices
Emcdonald on DSK2BSOYB1PROD with NOTICES
Exchange.5 By way of example, an
Inactive Nominee would be activated in
the event of an emergency due to illness
or other factors. This would allow a
member organization to have a full staff
available to conduct business on the
Exchange trading floor.
An Inactive Nominee is also deemed
a clerk for purposes of Exchange Rule
1090.6 Rule 1090 was enacted to
identify categories of persons that are
not members of the Exchange and who
are not eligible to effect transactions, but
are located on the Exchange’s trading
floor. In order for Rule 1090 to apply to
all categories of registered persons
located on the Exchange’s Options Floor
that are generally not eligible to effect
transactions, Inactive Nominees are
deemed to be Clerks for purposes of that
Rule.7
Currently, the Exchange assesses a
$100 per month Trading Floor
Personnel Registration Fee. This fee is
imposed on member/participant
organizations for individuals who are
employed by such member/participant
organizations and who work on the
Exchange’s trading floor, such as clerks,
interns, stock execution clerks that
handle equity orders that are part of an
options contingency order and other
associated persons, but who are not
registered as members or participants.
The Exchange currently does not
impose the Trading Floor Personnel
Registration Fee on Inactive Nominees
because an Inactive Nominee is required
to register as a member.
The Exchange is proposing to
eliminate the following qualifying
language applicable to the Trading Floor
Personnel Fee ‘‘* * * but who are not
registered as members or participants.’’
In addition, the Exchange is proposing
to add the following clarifying language
‘‘[t]his fee is not imposed on permit
holders.’’ The Exchange also proposes to
add a parenthetical to indicate that for
purposes of the Trading Floor Personnel
Registration Fee a Clerk includes an
5 The Inactive Nominee is required to notify the
Membership Department in writing prior to the
trading day on which they will act in place of a
member. The Exchange requires an Inactive
Nominee on the Exchange’s trading floor to wear a
badge which is provided by the Exchange and
contains identifying information. The Inactive
Nominee cannot simultaneously act as a member
and a clerk on the same day.
6 The term ‘‘Clerk ’’ means any registered on-floor
person employed by or associated with a member,
member organization, participant, or participant
organization who is not a member and is not
eligible to effect transactions on the Options Floor
as a Specialist, Registered Options Trader, or Floor
Broker. See Exchange Rule 1090. For purposes of
Rule 1090, an Inactive Nominee shall be deemed a
Clerk.
7 See Securities Exchange Act Release No. 46505
(September 17, 2002), 67 FR 60273 (September 25,
2002) (SR–Phlx–2001–104).
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18:47 Apr 01, 2011
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Inactive Nominee. This would add
Inactive Nominees to the list of
individuals who are employed on the
Exchange’s trading floor and are subject
to the Trading Floor Personnel
Registration Fee. The only participants
that would not be subject to the fee
would be permit holders.
Additionally, the Exchange is
proposing to amend the definitions of
dividend and merger strategies in
Section II of the Fee Schedule titled
‘‘Equity Options Fees.’’ The Exchange
recently amended the definitions of
dividend and merger strategy to provide
clarity with respect to the text ‘‘prior to
the date.’’ 8 The Exchange added the
word ‘‘immediately’’ to both definitions
to make clear that the timing of the
trigger event must occur the first
business day prior to the trigger event.
For example, with respect to a dividend
strategy, the Exchange would interpret
the proposed term ‘‘immediately’’ to
mean the first business day prior to the
date on which the underlying stock goes
ex-dividend. With respect to a merger
strategy, the Exchange would interpret
the proposed term ‘‘immediately’’ to
mean the first business day prior to the
date on which shareholders of record
are required to elect their respective
form of consideration. In order that the
meaning of immediately is clear, the
Exchange is proposing to replace the
words ‘‘immediately’’ with ‘‘the first
business day’’ in both the dividend and
merger strategy definitions in Section II
of the Fee Schedule.
2. Statutory Basis
The Exchange believes that its
proposal to amend its Fee Schedule is
consistent with Section 6(b) of the Act 9
in general, and furthers the objectives of
Section 6(b)(4) of the Act 10 in
particular, in that it is an equitable
allocation of reasonable fees and other
charges among Exchange members and
other persons using its facilities.
The Exchange believes that applying
the Trading Floor Personnel Registration
Fee to Inactive Nominees is reasonable
because Inactive Nominees are not
subject to the permit fees which permit
holders are required to pay to maintain
their membership. Permit holders are
required to pay a monthly Permit Fee in
order to transact business at the
Exchange. Similar to clerks, interns and
stock execution clerks, Inactive
Nominees do not pay a permit fee.
The Exchange believes that applying
the Trading Floor Personnel Registration
Fee to Inactive Nominees is equitable
8 See
SR–Phlx–2011–20.
U.S.C. 78f(b).
10 15 U.S.C. 78f(b)(4).
because it would uniformly apply to all
inactive nominees and overall the fee
would apply to all individuals that do
not maintain a permit.
The Exchange believes that it is
reasonable to amend the definitions of
dividend and merger strategies to
provide members with a definition that
is clear and unambiguous. In addition,
the Exchange believes that the amended
definitions would provide members
clear guidance on the applicability of
the equity option transaction charges
and the available caps.
The Exchange believes that the
proposed amendments are equitable
because the proposed new definitions
would apply equally to all members
transacting dividend or merger
strategies. The Exchange would
uniformly apply the definitions to all
members who transacted such dividend
and/or merger strategies when assessing
equity option transaction charges and
applying caps.
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.11 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.
9 15
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11 15
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U.S.C. 78s(b)(3)(A)(ii).
04APN1
Federal Register / Vol. 76, No. 64 / Monday, April 4, 2011 / Notices
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–2011–32 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–64143; File No. SR–
NASDAQ–2011–037]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing of Proposed Rule Change to
Modify Chapter VI, Section 8 of the
Exchange’s Rules
March 29, 2011.
Paper Comments
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 15,
2011, The NASDAQ Stock Market LLC
(‘‘NASDAQ’’), filed with the Securities
All submissions should refer to File
and Exchange Commission
Number SR–Phlx–2011–32. This file
(‘‘Commission’’) the proposed rule
number should be included on the
change as described in Items I, II, and
subject line if e-mail is used. To help the III below, which Items have been
Commission process and review your
prepared by NASDAQ. The Commission
comments more efficiently, please use
is publishing this notice to solicit
only one method. The Commission will comments on the proposed rule change
post all comments on the Commission’s from interested persons.
Internet Web site (https://www.sec.gov/
I. Self-Regulatory Organization’s
rules/sro.shtml). Copies of the
Statement of the Terms of the Substance
submission, all subsequent
of the Proposed Rule Change
amendments, all written statements
with respect to the proposed rule
NASDAQ proposes to modify Chapter
change that are filed with the
VI, Section 8 of the Exchange’s rules,
Commission, and all written
dealing with the Nasdaq Opening Cross.
communications relating to the
Additionally, NASDAQ is proposing to
proposed rule change between the
Commission and any person, other than establish a Halt Cross that is nearly
identical to the modified Opening Cross
those that may be withheld from the
on NOM. The Exchange proposes to
public in accordance with the
implement these changes on or about
provisions of 5 U.S.C. 552, will be
May 31, 2011.
available for Web site viewing and
printing in the Commission’s Public
The text of the proposed rule change
Reference Room on official business
is available at https://
days between the hours of 10 a.m. and
nasdaq.cchwallstreet.com/, at
3 p.m. Copies of such filing also will be
NASDAQ’s principal office, and at the
available for inspection and copying at
Commission’s Public Reference Room.
the principal offices of the Exchange.
II. Self-Regulatory Organization’s
All comments received will be posted
Statement of the Purpose of, and
without change; the Commission does
Statutory Basis for, the Proposed Rule
not edit personal identifying
Change
information from submissions. You
should submit only information that
In its filing with the Commission,
you wish to make available publicly. All
NASDAQ included statements
submissions should refer to File
concerning the purpose of and basis for
Number SR–Phlx–2011–32, and should
the proposed rule change and discussed
be submitted on or before April 25,
any comments it received on the
2011.
proposed rule change. The text of these
For the Commission, by the Division of
statements may be examined at the
Trading and Markets, pursuant to delegated
places specified in Item IV below.
authority.12
NASDAQ has prepared summaries, set
Cathy H. Ahn,
forth in Sections A, B, and C below, of
Deputy Secretary.
the most significant aspects of such
[FR Doc. 2011–7814 Filed 4–1–11; 8:45 am]
statements.
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.
BILLING CODE 8011–01–P
1 15
12 17
CFR 200.30–3(a)(12).
VerDate Mar<15>2010
18:47 Apr 01, 2011
2 17
Jkt 223001
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00080
Fmt 4703
Sfmt 4703
18589
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Nasdaq proposes to modify Chapter
VI, Section 8 of the rules governing
NOM, and in particular governing the
opening of trading at the start of the
trading day and at the resumption of
trading following a halt. Since NOM
was launched on March 31, 2008
Nasdaq has monitored the operation of
the market to identify instances where
market efficiency can be enhanced.3
NASDAQ believes that the opening of
the market, while currently quite
effective, can be further enhanced, and
that a Halt Cross would create a more
orderly opening following a trading halt.
First, NOM currently employs a series
of tie-breakers that resolve instances
where multiple prices satisfy the
conditions for executing the cross.
These tie-breakers govern the
calculation of the Current Reference
Price that is disseminated to market
participants prior to the execution of a
cross. The tie-breakers also govern the
calculation of the actual cross price. The
tiebreakers are criteria that operate in a
hierarchy. If one and only one price
satisfies the first criterion, the system
has no need to move to the second.
Conversely, if multiple prices satisfy the
first criterion, the algorithm turns to the
second criteria and if multiple prices
satisfy the second criterion, the
algorithm then turns to the third
criterion.
NASDAQ is proposing to eliminate
what currently serves as the second tiebreaker that NOM employs to establish
the Current Reference Price as set forth
in Chapter VI, Section 8(a)(2(A)(ii) [sic]
and the Cross price as set forth in
subsection (b)(2)(B) of that Rule. This
tie-breaker resolves price disputes based
on minimizing order imbalances. In
other words, under the current system,
when more than one price satisfies
equally the first condition for the
Opening Cross, the system will choose
that price which minimizes the order
imbalance remaining if the cross were to
be executed.
NASDAQ has determined to eliminate
this tie-breaker because it has not
proven useful in augmenting price
discovery prior to the cross or in
3 See Securities Exchange Act Release No. 60905
(Oct. 30, 2009), 74 FR 57544 (Nov. 6, 2009)) (SR–
NASDAQ–2009–033); Securities Exchange Act
Release No. 57822 (May 15, 2008), 73 FR 29800
(May 22, 2008)) (SR–NASDAQ–2008–045);
Securities Exchange Act Release No. 57977 (June
17, 2008), 73 FR 35429 (June 23, 2008) (SR–
NASDAQ–2008–052).
E:\FR\FM\04APN1.SGM
04APN1
Agencies
[Federal Register Volume 76, Number 64 (Monday, April 4, 2011)]
[Notices]
[Pages 18587-18589]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-7814]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64141; File No. SR-Phlx-2011-32]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX LLC Relating
to Inactive Nominees and Dividend and Merger Strategy Definitions
March 29, 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 24, 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 the Exchange's Fee Schedule to apply
the Trading Floor Personnel Registration Fee to Inactive Nominees.\3\
In addition, the Exchange is proposing to amend the dividend and merger
strategy text in the Exchange's Fee Schedule to add specificity to
those definitions.
---------------------------------------------------------------------------
\3\ The term ``inactive nominee'' means a natural person
associated with and designated as such by a member organization and
who has been approved for such status and is registered as such with
the Membership Department. An inactive nominee shall have no rights
or privileges under a permit unless and until said inactive nominee
becomes admitted as a member of the Exchange pursuant to the By-Laws
and Rules of the Exchange. An inactive nominee merely stands ready
to exercise rights under a permit upon notice by the member
organization to the Membership Department on an expedited basis. See
Exchange Rule 1(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
Web site 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.
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 the Exchange's
Fee Schedule to provide that an Inactive Nominee must pay the Trading
Floor Personnel Registration Fee in order to recover certain
administrative expenses associated with Inactive Nominees. An Inactive
Nominee's status requires additional administration because the
Inactive Nominee is also deemed a clerk for the purpose of Exchange
Rule 1090.
Pursuant to By-Law Article X, Section 12-10, to be eligible as an
Inactive Nominee, an individual must be approved as eligible to hold a
permit in accordance with the Exchange's By-Laws and Rules. An Inactive
Nominee does not have any rights or privileges of a permit holder
unless and until the Inactive Nominee becomes an effective permit
holder and all applicable Exchange fees are paid.\4\
---------------------------------------------------------------------------
\4\ An Inactive Nominee is currently required to pay $500 every
6 months for the privilege of maintaining an Inactive Nominee
Status. See the Inactive Nominee Fee on the Exchange's Fee Schedule.
See also Exchange By-Law Article X, Section 12-10.
---------------------------------------------------------------------------
The Inactive Nominee allows a member to have additional flexibility
in obtaining coverage on the trading floor. An Inactive Nominee stands
ready to assume a membership upon notice by the member requesting that
a specific permit be transferred intra-firm on an expedited and
temporary basis. This transfer allows an Inactive Nominee to become an
effective member of the
[[Page 18588]]
Exchange.\5\ By way of example, an Inactive Nominee would be activated
in the event of an emergency due to illness or other factors. This
would allow a member organization to have a full staff available to
conduct business on the Exchange trading floor.
---------------------------------------------------------------------------
\5\ The Inactive Nominee is required to notify the Membership
Department in writing prior to the trading day on which they will
act in place of a member. The Exchange requires an Inactive Nominee
on the Exchange's trading floor to wear a badge which is provided by
the Exchange and contains identifying information. The Inactive
Nominee cannot simultaneously act as a member and a clerk on the
same day.
---------------------------------------------------------------------------
An Inactive Nominee is also deemed a clerk for purposes of Exchange
Rule 1090.\6\ Rule 1090 was enacted to identify categories of persons
that are not members of the Exchange and who are not eligible to effect
transactions, but are located on the Exchange's trading floor. In order
for Rule 1090 to apply to all categories of registered persons located
on the Exchange's Options Floor that are generally not eligible to
effect transactions, Inactive Nominees are deemed to be Clerks for
purposes of that Rule.\7\
---------------------------------------------------------------------------
\6\ The term ``Clerk '' means any registered on-floor person
employed by or associated with a member, member organization,
participant, or participant organization who is not a member and is
not eligible to effect transactions on the Options Floor as a
Specialist, Registered Options Trader, or Floor Broker. See Exchange
Rule 1090. For purposes of Rule 1090, an Inactive Nominee shall be
deemed a Clerk.
\7\ See Securities Exchange Act Release No. 46505 (September 17,
2002), 67 FR 60273 (September 25, 2002) (SR-Phlx-2001-104).
---------------------------------------------------------------------------
Currently, the Exchange assesses a $100 per month Trading Floor
Personnel Registration Fee. This fee is imposed on member/participant
organizations for individuals who are employed by such member/
participant organizations and who work on the Exchange's trading floor,
such as clerks, interns, stock execution clerks that handle equity
orders that are part of an options contingency order and other
associated persons, but who are not registered as members or
participants. The Exchange currently does not impose the Trading Floor
Personnel Registration Fee on Inactive Nominees because an Inactive
Nominee is required to register as a member.
The Exchange is proposing to eliminate the following qualifying
language applicable to the Trading Floor Personnel Fee ``* * * but who
are not registered as members or participants.'' In addition, the
Exchange is proposing to add the following clarifying language ``[t]his
fee is not imposed on permit holders.'' The Exchange also proposes to
add a parenthetical to indicate that for purposes of the Trading Floor
Personnel Registration Fee a Clerk includes an Inactive Nominee. This
would add Inactive Nominees to the list of individuals who are employed
on the Exchange's trading floor and are subject to the Trading Floor
Personnel Registration Fee. The only participants that would not be
subject to the fee would be permit holders.
Additionally, the Exchange is proposing to amend the definitions of
dividend and merger strategies in Section II of the Fee Schedule titled
``Equity Options Fees.'' The Exchange recently amended the definitions
of dividend and merger strategy to provide clarity with respect to the
text ``prior to the date.'' \8\ The Exchange added the word
``immediately'' to both definitions to make clear that the timing of
the trigger event must occur the first business day prior to the
trigger event. For example, with respect to a dividend strategy, the
Exchange would interpret the proposed term ``immediately'' to mean the
first business day prior to the date on which the underlying stock goes
ex-dividend. With respect to a merger strategy, the Exchange would
interpret the proposed term ``immediately'' to mean the first business
day prior to the date on which shareholders of record are required to
elect their respective form of consideration. In order that the meaning
of immediately is clear, the Exchange is proposing to replace the words
``immediately'' with ``the first business day'' in both the dividend
and merger strategy definitions in Section II of the Fee Schedule.
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\8\ See SR-Phlx-2011-20.
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2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \9\ in general, and furthers
the objectives of Section 6(b)(4) of the Act \10\ in particular, in
that it is an equitable allocation of reasonable fees and other charges
among Exchange members and other persons using its facilities.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that applying the Trading Floor Personnel
Registration Fee to Inactive Nominees is reasonable because Inactive
Nominees are not subject to the permit fees which permit holders are
required to pay to maintain their membership. Permit holders are
required to pay a monthly Permit Fee in order to transact business at
the Exchange. Similar to clerks, interns and stock execution clerks,
Inactive Nominees do not pay a permit fee.
The Exchange believes that applying the Trading Floor Personnel
Registration Fee to Inactive Nominees is equitable because it would
uniformly apply to all inactive nominees and overall the fee would
apply to all individuals that do not maintain a permit.
The Exchange believes that it is reasonable to amend the
definitions of dividend and merger strategies to provide members with a
definition that is clear and unambiguous. In addition, the Exchange
believes that the amended definitions would provide members clear
guidance on the applicability of the equity option transaction charges
and the available caps.
The Exchange believes that the proposed amendments are equitable
because the proposed new definitions would apply equally to all members
transacting dividend or merger strategies. The Exchange would uniformly
apply the definitions to all members who transacted such dividend and/
or merger strategies when assessing equity option transaction charges
and applying caps.
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.\11\ 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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\11\ 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.
[[Page 18589]]
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-2011-32 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-2011-32. 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 offices
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-2011-32, and should be submitted on or before April 25, 2011.
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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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-7814 Filed 4-1-11; 8:45 am]
BILLING CODE 8011-01-P