Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to CBSX Rule 53.24, 67037-67038 [2012-27318]

Download as PDF Federal Register / Vol. 77, No. 217 / Thursday, November 8, 2012 / Notices will then compare the aggregate positions reported by each clearing member with its own records and make any needed adjustments to the initial margin calculation to ensure all positions on OCC’s books are properly margined. tkelley on DSK3SPTVN1PROD with NOTICES Proposed By-Law and Rule Changes The proposed changes to OCC’s Rules provide for the calculation of initial margin for segregated futures customer accounts on a gross basis and mandate submission of the clearing member data files necessary to allow OCC to calculate initial margin at the level of each futures customer. In the event that the data included in these data files is incomplete (for example, if OCC shows positions held in a clearing member’s segregated futures accounts, but those positions are not reflected in the data file), OCC will create a separate subaccount to be used for initial margin calculation purposes only. Positions recorded on OCC’s books and records, but not reflected in the data file, will be attributed to this sub-account and an initial margin amount will be calculated for the sub-account. This initial margin amount will be added to a clearing member’s initial margin requirement. OCC has determined to adopt this approach to dealing with discrepancies between its own records and clearing member data files in order to ensure that OCC does not collect an inadequate amount of initial margin from clearing members. III. Discussion of the Proposed Rule Change Section 19(b)(2)(C) of the Exchange Act 12 directs the Commission to approve a proposed rule change of a self-regulatory organization if it finds that the proposed rule change is consistent with the requirements of the Exchange Act and the rules and regulations thereunder applicable to such organization. Section 17A(b)(3)(F) of the Exchange Act 13 requires that the rules of the clearing agency, among other things, are designed to promote the prompt and accurate clearance and settlement of securities transactions, and, to the extent applicable, derivative agreements, contracts, and transactions. The Commission finds that the proposed rule change is consistent with the requirements of Section 17A of the Exchange Act 14 because it is designed to permit OCC to perform clearing services for products that are subject to the jurisdiction of the CFTC without adversely affecting OCC’s obligations with respect to the prompt and accurate clearance and settlement of securities transactions or the protection of securities investors and the public interest. change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. IV. Conclusion On the basis of the foregoing, the Commission finds that the proposal is consistent with the requirements of the Act and in particular with the requirements of Section 17A of the Act 15 and the rules and regulations thereunder. It is therefore ordered, pursuant to Section 19(b)(2) of the Act,16 that the proposed rule change (File No. SR– OCC–2012–17) be and hereby is approved 17 as of the date of this order or the date of the ‘‘Notice of No Objection to Advance Notice Filing, as Modified by Amendment No. 1 Thereto, Relating to the Margining of Segregated Futures Customer Accounts on a Gross Basis’’ (File No. SR–2012–17), whichever is later. The purpose of the filing is to amend Rule 53.24 (Quote Maintenance) of the CBOE Stock Exchange, LLC (‘‘CBSX’’) to delete references to the automatic quote regeneration and quote risk monitor functions. 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. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–27293 Filed 11–7–12; 8:45 am] BILLING CODE 8011–01–P VerDate Mar<15>2010 18:34 Nov 07, 2012 Jkt 229001 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change 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. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–68144; File No. SR–CBOE– 2012–103] A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to CBSX Rule 53.24 November 2, 2012. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b-4 thereunder,2 notice is hereby given that on October 25, 2012, Chicago Board Options Exchange, Incorporated (the ‘‘Exchange’’ or ‘‘CBOE’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule 15 15 U.S.C. 78q–1. U.S.C. 78s(b)(2). 17 In approving the proposed rule change, the Commission considered the proposal’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 18 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 16 15 internal non-proprietary cross-margining accounts. All such accounts would be margined on a gross basis under the proposed amendments to OCC Rule 601. 12 15 U.S.C. 78s(b)(2)(C). 13 15 U.S.C. 78q–1(b)(3)(F). 14 15 U.S.C. 78q–1. 67037 PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 The purpose of the filing is to eliminate Rule 53.24(b) (Automatic Quote Regeneration) and Rule 53.24(c) (Quote Risk Monitor Function) from CBOE Stock Exchange, LLC’s (‘‘CBSX’’) Rule 53.24 (Quote Maintenance). Pursuant to Rule 53.24(b), once the CBSX system is so enabled, a CBSX Remote Market-Maker may have the CBSX system automatically regenerate its quote when its bid or offer is filled. Pursuant to Rule 53.24(c), the CBSX system may provide a CBSX MarketMaker the opportunity to establish a share volume limit for a specific security for a specific period of time. In the event that trades against a CBSX Market-Maker’s quotes exceed the established volume limit, the CBSX System will cancel that Market-Maker’s remaining quotes for that security. To date, neither the automatic quote regeneration nor the quote risk monitor function has been made available or been used. The Exchange also has no E:\FR\FM\08NON1.SGM 08NON1 67038 Federal Register / Vol. 77, No. 217 / Thursday, November 8, 2012 / Notices intention of enabling the CBSX system to provide for either function. Reference to these features is therefore unnecessary and accordingly, the Exchange proposes to eliminate Rule 53.24(b) (Automatic Quote Regeneration) and Rule 53.24(c) (Quote Risk Monitor Function) from its rules. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ‘‘Act’’) 3 and the rules and regulations thereunder and, in particular, the requirements of Section 6(b) of the Act.4 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 5 requirements that the rules of an exchange be designed to promote just and equitable principles of trade, to prevent fraudulent and manipulative acts, to remove impediments to and to perfect the mechanism for a free and open market and a national market system, and, in general, to protect investors and the public interest. Since neither the automatic quote regeneration nor the quote risk monitor functions have ever been made available or used, and as the Exchange has no intention of providing for such, the Exchange would like to remove reference to them from its rules, which would maintain clarity in the rules and reduce possible confusion. 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 No written comments were solicited or received with respect to the proposed rule change. tkelley on DSK3SPTVN1PROD with NOTICES III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing rule does not (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the U.S.C. 78s(b)(1). U.S.C. 78f(b). 5 15 U.S.C. 78f(b)(5). public interest, provided that the selfregulatory organization has given the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change or such shorter time as designated by the Commission, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 6 and Rule 19b–4(f)(6) thereunder.7 At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rulecomments@sec.gov. Please include File Number SR–CBOE–2012–103 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–2012–103. 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 3 15 18:34 Nov 07, 2012 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2012–27318 Filed 11–7–12; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–68142; File No. SR–FINRA– 2012–040] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving Proposed Rule Change To Amend the By-Laws of FINRA Dispute Resolution, Inc. To Clarify That Services Provided by Mediators Should Not Cause Them To Be Classified as Industry Members Under the By-Laws November 2, 2012. I. Introduction On August 23, 2012 the Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Exchange Act’’ or ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend the By-Laws of FINRA Dispute Resolution, Inc. (‘‘By-Laws’’) to clarify that services provided by mediators, when acting in such capacity and not representing parties in mediation, should not cause the individuals to be classified as Industry Members under the By-Laws. Specifically, the proposed rule change would amend the definitions of Industry 8 17 4 15 VerDate Mar<15>2010 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 such filing also will be available for inspection and copying at the principal office of the 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– 2012–103 and should be submitted on or before November 29, 2012. CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 6 15 U.S.C. 78s(b)(3)(A). 7 17 CFR 240.19b–4(f)(6). Jkt 229001 PO 00000 Frm 00088 Fmt 4703 1 15 Sfmt 4703 E:\FR\FM\08NON1.SGM 08NON1

Agencies

[Federal Register Volume 77, Number 217 (Thursday, November 8, 2012)]
[Notices]
[Pages 67037-67038]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-27318]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68144; File No. SR-CBOE-2012-103]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change to CBSX Rule 53.24

November 2, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on October 25, 2012, Chicago Board Options Exchange, Incorporated 
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange 
Commission (the ``Commission'') the proposed rule change as described 
in Items I and II below, which Items have been prepared by the 
Exchange. The 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 purpose of the filing is to amend Rule 53.24 (Quote 
Maintenance) of the CBOE Stock Exchange, LLC (``CBSX'') to delete 
references to the automatic quote regeneration and quote risk monitor 
functions. 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, 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the filing is to eliminate Rule 53.24(b) (Automatic 
Quote Regeneration) and Rule 53.24(c) (Quote Risk Monitor Function) 
from CBOE Stock Exchange, LLC's (``CBSX'') Rule 53.24 (Quote 
Maintenance). Pursuant to Rule 53.24(b), once the CBSX system is so 
enabled, a CBSX Remote Market-Maker may have the CBSX system 
automatically regenerate its quote when its bid or offer is filled. 
Pursuant to Rule 53.24(c), the CBSX system may provide a CBSX Market-
Maker the opportunity to establish a share volume limit for a specific 
security for a specific period of time. In the event that trades 
against a CBSX Market-Maker's quotes exceed the established volume 
limit, the CBSX System will cancel that Market-Maker's remaining quotes 
for that security. To date, neither the automatic quote regeneration 
nor the quote risk monitor function has been made available or been 
used. The Exchange also has no

[[Page 67038]]

intention of enabling the CBSX system to provide for either function. 
Reference to these features is therefore unnecessary and accordingly, 
the Exchange proposes to eliminate Rule 53.24(b) (Automatic Quote 
Regeneration) and Rule 53.24(c) (Quote Risk Monitor Function) from its 
rules.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') \3\ and the rules and 
regulations thereunder and, in particular, the requirements of Section 
6(b) of the Act.\4\ Specifically, the Exchange believes the proposed 
rule change is consistent with the Section 6(b)(5) \5\ requirements 
that the rules of an exchange be designed to promote just and equitable 
principles of trade, to prevent fraudulent and manipulative acts, to 
remove impediments to and to perfect the mechanism for a free and open 
market and a national market system, and, in general, to protect 
investors and the public interest. Since neither the automatic quote 
regeneration nor the quote risk monitor functions have ever been made 
available or used, and as the Exchange has no intention of providing 
for such, the Exchange would like to remove reference to them from its 
rules, which would maintain clarity in the rules and reduce possible 
confusion.
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 78s(b)(1).
    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    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 rule does not (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate if consistent with the protection of investors 
and the public interest, provided that the self-regulatory organization 
has given the Commission written notice of its intent to file the 
proposed rule change at least five business days prior to the date of 
filing of the proposed rule change or such shorter time as designated 
by the Commission, the proposed rule change has become effective 
pursuant to Section 19(b)(3)(A) of the Act \6\ and Rule 19b-4(f)(6) 
thereunder.\7\ At any time within 60 days of the filing of such 
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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

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 rule-comments@sec.gov. Please include 
File Number SR-CBOE-2012-103 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-2012-103. 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 such filing also will be available 
for inspection and copying at the principal office of the 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-2012-103 and should be 
submitted on or before November 29, 2012.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-27318 Filed 11-7-12; 8:45 am]
BILLING CODE 8011-01-P
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