Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Designation of Longer Period for Commission Action on Proceedings To Determine Whether To Disapprove Proposed Rule Change, as Modified by Amendment No. 1, To Add an Index Option Product for Trading on the Exchange, 58432-58433 [2012-23180]

Download as PDF 58432 Federal Register / Vol. 77, No. 183 / Thursday, September 20, 2012 / Notices displayed market (as the trade occurs at the midpoint of the NBBO). Further, the Taker removing silent-mid or silentpost-mid liquidity will apply to all market participants removing silent-mid or silent-post-mid liquidity. Assessing different fees for orders priced $1 or greater than for such orders priced less than $1 is equitable and not unfairly discriminatory because since orders priced less than $1 can be entered in sub-penny increments (fourdecimal increments), the Exchange believes that employing Maker-Taker pricing similar to that employed for orders priced $1 or greater would not be effective given a market participant’s ability to more-transparently and finitely establish prices in the book. Further, CBSX already assesses different fees for other orders priced $1 or greater than for the same orders priced less than $1.6 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 the purposes of the Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither solicited nor received comments on the proposed rule change. 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) 7 of the Act and paragraph (f) of Rule 19b–4 8 thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. mstockstill on DSK4VPTVN1PROD with NOTICES 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 email to rulecomments@sec.gov. Please include File Number SR–CBOE–2012–088 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–2012–088. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–CBOE– 2012–088 and should be submitted on or before October 11, 2012. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–23179 Filed 9–19–12; 8:45 am] BILLING CODE 8011–01–P 6 See CBSX Fees Schedule, Section 2. 7 15 U.S.C. 78s(b)(3)(A). 8 17 CFR 240.19b–4(f). VerDate Mar<15>2010 16:11 Sep 19, 2012 Jkt 226001 9 17 PO 00000 CFR 200.30–3(a)(12). Frm 00079 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–67865; File No. SR–ISE– 2012–22] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Designation of Longer Period for Commission Action on Proceedings To Determine Whether To Disapprove Proposed Rule Change, as Modified by Amendment No. 1, To Add an Index Option Product for Trading on the Exchange September 14, 2012. On March 9, 2012, the International Securities Exchange, LLC (‘‘Exchange’’ or ‘‘ISE’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to list and trade options on the ISE Max SPY Index. The proposed rule change was published for comment in the Federal Register on March 22, 2012.3 The Commission initially received three comment letters on the proposed rule change.4 On May 1, 2012, the Commission extended the time period for Commission action to June 20, 2012.5 On May 4, 2012, the Exchange submitted a response to the comment letters 6 and filed Amendment No. 1 to the proposed rule change. The Commission subsequently received three additional comment letters 7 and a second response letter from the Exchange.8 On June 20, 2012, the Commission instituted proceedings to determine whether to disapprove the proposed rule change, as modified by 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 See Securities Exchange Act Release No. 66614 (March 16, 2012), 77 FR 16883. 4 See letters to Elizabeth M. Murphy, Secretary, Commission, from Janet McGinness, EVP & Corporate Secretary, NYSE Euronext, dated April 2, 2012; Kenneth M. Vittor, Executive Vice President and General Counsel, McGraw-Hill Companies, Inc., dated April 11, 2012; and Edward T. Tilly, President and Chief Operating Officer, Chicago Board Options Exchange, Incorporated (‘‘CBOE’’), dated April 13, 2012. 5 See Securities Exchange Act Release No. 66889 (May 1, 2012), 77 FR 26812 (May 7, 2012). 6 See letter to Elizabeth M. Murphy, Secretary, Commission, from Michael J. Simon, Secretary and General Counsel, ISE, dated May 4, 2012. 7 See letters to Elizabeth M. Murphy, Secretary, Commission, from Edward T. Tilly, President and Chief Operating Officer, CBOE, dated June 7, 2012; Kenneth M. Vittor, Executive Vice President and General Counsel, McGraw-Hill Companies, Inc., dated June 18, 2012; and Edward T. Tilly, President and Chief Operating Officer, CBOE, dated June 19, 2012. 8 See letter to Elizabeth M. Murphy, Secretary, Commission, from Michael J. Simon, Secretary and General Counsel, ISE, dated June 15, 2012. 2 17 E:\FR\FM\20SEN1.SGM 20SEN1 Federal Register / Vol. 77, No. 183 / Thursday, September 20, 2012 / Notices mstockstill on DSK4VPTVN1PROD with NOTICES Amendment No. 1.9 The Commission thereafter received six comment letters 10 and two response letters from the Exchange.11 Section 19(b)(2) of the Act 12 provides that, after initiating disapproval proceedings, the Commission shall issue an order approving or disapproving the proposed rule change not later than 180 days after the date of publication of notice of filing of the proposed rule change. The Commission may extend the period for issuing an order approving or disapproving the proposed rule change, however, by not more than 60 days if the Commission determines that a longer period is appropriate and publishes the reasons for such determination. The proposed rule change was published for notice and comment in the Federal Register on March 22, 2012. September 18, 2012 is 180 days from that date, and November 17, 2012 is 240 days from that date. The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider this proposed rule change, the issues raised in the comment letters that have been submitted in response to the proposed rule change, including comment letters submitted in response to the Order Instituting Proceedings, and the Exchange’s responses to such comments. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,13 designates November 17, 2012 as the date by which the Commission shall either approve or disapprove the proposed rule change (File No. SR–ISE– 2012–22). 9 See Securities Exchange Act Release No. 67225 (June 20, 2012), 77 FR 38100 (June 26, 2012) (‘‘Order Instituting Proceedings’’). 10 See letters to Elizabeth M. Murphy, Secretary, Commission, from Christopher Nagy, President, KOR Trading LLC, dated August 6, 2012; John L. Jacobs, Executive Vice President, NASDAQ OMX Global Index Group, NASDAQ OMX Group, Inc., dated August 10, 2012; Kenneth M. Vittor, Executive Vice President and General Counsel, McGraw-Hill Companies, Inc., dated August 10, 2012; Edward T. Tilly, President and Chief Operating Officer, CBOE, dated August 10, 2012; John V. O’Hanlon, Dechert LLP, on behalf of the Index Industry Association, dated August 10, 2012; and Edward T. Tilly, President and Chief Operating Officer, CBOE, dated August 27, 2012. 11 See letters to Elizabeth M. Murphy, Secretary, Commission, from Michael J. Simon, Secretary, ISE, dated August 10, 2012 and August 27, 2012. 12 15 U.S.C. 78s(b)(2). 13 15 U.S.C. 78s(b)(2). VerDate Mar<15>2010 16:11 Sep 19, 2012 Jkt 226001 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.14 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–23180 Filed 9–19–12; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–67863; File No. SR– NYSEARCA–2012–94] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Proposes [sic] To Amend Commentary .06 to NYSE Arca Options Rule 6.4 To Permit the Exchange To List Additional Strike Prices Until the Close of Trading on the Second Business Day Prior to Monthly Expiration. September 14, 2012. 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 September 6, 2012, NYSE Arca, Inc. (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been 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 proposes to [sic] amend Commentary .06 to NYSE Arca Options Rule 6.4 to permit the Exchange to list additional strike prices until the close of trading on the second business day prior to monthly expiration. The text of the proposed rule change is available on the Exchange’s Web site at www.nyse.com, 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 self-regulatory organization included statements concerning the purpose of, 14 17 CFR 200.30–3(a)(57). U.S.C.78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 58433 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 1. Purpose The purpose of this filing is to amend Commentary .06 to NYSE Arca Options Rule 6.4 to permit the Exchange to add additional strikes until the close of trading on the second business day prior to a monthly expiration. NYSE Arca Options Rule 6.4 currently permits the Exchange to open additional series of individual stock options until the first calendar day of the month in which the option expires or until the fifth business day prior to expiration if unusual market conditions exist.4 Options market participants generally prefer to focus their trading in strike prices that immediately surround the price of the underlying security. However, if the price of the underlying stock moves significantly, there may be a market need for additional strike prices to adequately account for market participants risk management needs in a stock. In these situations, the Exchange 4 See Commentary .06 to NYSE Arca Options Rule 6.4. ‘Until the fifth business day prior’ generally means up through the end of the day on the Friday of the week prior to expiration week. When options were first approved for listing and trading in the United States, the generally uniform rules of the options exchanges restricted the addition of new series ‘‘until the first calendar day of the month in which the option expires.’’ At various times in 1985, exchanges were granted authority to list new equity options series until five business days prior to expiration under unusual market conditions. In 1985 there were two main concerns expressed by the Commission: (i) Worry over the proliferation of strikes and possible capacity concerns, and (ii) effective and timely communication to market participants about the new strikes. At the time, though, exchanges were only allowed to list three expiration months per issue, and were expanding from listing three strikes to listing five strikes. Since then, there has been a continual expansion of the number of strikes, the number of expiration months, and alternative expiration days. Following the restructuring of OPRA in 2003, each exchange became responsible for purchasing sufficient capacity to handle its own quotes generated by the series and classes it listed. Also, when options were first listed, additional strikes were communicated via teletype and firm wires to branch offices, firm back offices, and OCC. As communications were improved, through the use of fax machines and then email, the time to send notifications decreased significantly. Now, with the adoption of Streamline Options Series Adds (‘‘SOSA’’) by OCC, notification of new strikes is in real time throughout the industry. E:\FR\FM\20SEN1.SGM 20SEN1

Agencies

[Federal Register Volume 77, Number 183 (Thursday, September 20, 2012)]
[Notices]
[Pages 58432-58433]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-23180]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67865; File No. SR-ISE-2012-22]


Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Designation of Longer Period for Commission Action on 
Proceedings To Determine Whether To Disapprove Proposed Rule Change, as 
Modified by Amendment No. 1, To Add an Index Option Product for Trading 
on the Exchange

September 14, 2012.
    On March 9, 2012, the International Securities Exchange, LLC 
(``Exchange'' or ``ISE'') filed with the Securities and Exchange 
Commission (``Commission''), pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to list and trade options on the 
ISE Max SPY Index. The proposed rule change was published for comment 
in the Federal Register on March 22, 2012.\3\ The Commission initially 
received three comment letters on the proposed rule change.\4\ On May 
1, 2012, the Commission extended the time period for Commission action 
to June 20, 2012.\5\ On May 4, 2012, the Exchange submitted a response 
to the comment letters \6\ and filed Amendment No. 1 to the proposed 
rule change. The Commission subsequently received three additional 
comment letters \7\ and a second response letter from the Exchange.\8\ 
On June 20, 2012, the Commission instituted proceedings to determine 
whether to disapprove the proposed rule change, as modified by

[[Page 58433]]

Amendment No. 1.\9\ The Commission thereafter received six comment 
letters \10\ and two response letters from the Exchange.\11\
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 66614 (March 16, 
2012), 77 FR 16883.
    \4\ See letters to Elizabeth M. Murphy, Secretary, Commission, 
from Janet McGinness, EVP & Corporate Secretary, NYSE Euronext, 
dated April 2, 2012; Kenneth M. Vittor, Executive Vice President and 
General Counsel, McGraw-Hill Companies, Inc., dated April 11, 2012; 
and Edward T. Tilly, President and Chief Operating Officer, Chicago 
Board Options Exchange, Incorporated (``CBOE''), dated April 13, 
2012.
    \5\ See Securities Exchange Act Release No. 66889 (May 1, 2012), 
77 FR 26812 (May 7, 2012).
    \6\ See letter to Elizabeth M. Murphy, Secretary, Commission, 
from Michael J. Simon, Secretary and General Counsel, ISE, dated May 
4, 2012.
    \7\ See letters to Elizabeth M. Murphy, Secretary, Commission, 
from Edward T. Tilly, President and Chief Operating Officer, CBOE, 
dated June 7, 2012; Kenneth M. Vittor, Executive Vice President and 
General Counsel, McGraw-Hill Companies, Inc., dated June 18, 2012; 
and Edward T. Tilly, President and Chief Operating Officer, CBOE, 
dated June 19, 2012.
    \8\ See letter to Elizabeth M. Murphy, Secretary, Commission, 
from Michael J. Simon, Secretary and General Counsel, ISE, dated 
June 15, 2012.
    \9\ See Securities Exchange Act Release No. 67225 (June 20, 
2012), 77 FR 38100 (June 26, 2012) (``Order Instituting 
Proceedings'').
    \10\ See letters to Elizabeth M. Murphy, Secretary, Commission, 
from Christopher Nagy, President, KOR Trading LLC, dated August 6, 
2012; John L. Jacobs, Executive Vice President, NASDAQ OMX Global 
Index Group, NASDAQ OMX Group, Inc., dated August 10, 2012; Kenneth 
M. Vittor, Executive Vice President and General Counsel, McGraw-Hill 
Companies, Inc., dated August 10, 2012; Edward T. Tilly, President 
and Chief Operating Officer, CBOE, dated August 10, 2012; John V. 
O'Hanlon, Dechert LLP, on behalf of the Index Industry Association, 
dated August 10, 2012; and Edward T. Tilly, President and Chief 
Operating Officer, CBOE, dated August 27, 2012.
    \11\ See letters to Elizabeth M. Murphy, Secretary, Commission, 
from Michael J. Simon, Secretary, ISE, dated August 10, 2012 and 
August 27, 2012.
---------------------------------------------------------------------------

    Section 19(b)(2) of the Act \12\ provides that, after initiating 
disapproval proceedings, the Commission shall issue an order approving 
or disapproving the proposed rule change not later than 180 days after 
the date of publication of notice of filing of the proposed rule 
change. The Commission may extend the period for issuing an order 
approving or disapproving the proposed rule change, however, by not 
more than 60 days if the Commission determines that a longer period is 
appropriate and publishes the reasons for such determination. The 
proposed rule change was published for notice and comment in the 
Federal Register on March 22, 2012. September 18, 2012 is 180 days from 
that date, and November 17, 2012 is 240 days from that date.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

    The Commission finds it appropriate to designate a longer period 
within which to issue an order approving or disapproving the proposed 
rule change so that it has sufficient time to consider this proposed 
rule change, the issues raised in the comment letters that have been 
submitted in response to the proposed rule change, including comment 
letters submitted in response to the Order Instituting Proceedings, and 
the Exchange's responses to such comments.
    Accordingly, the Commission, pursuant to Section 19(b)(2) of the 
Act,\13\ designates November 17, 2012 as the date by which the 
Commission shall either approve or disapprove the proposed rule change 
(File No. SR-ISE-2012-22).
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
---------------------------------------------------------------------------

    \14\ 17 CFR 200.30-3(a)(57).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-23180 Filed 9-19-12; 8:45 am]
BILLING CODE 8011-01-P
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