Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Appointment Cost of IWM Options, 58354-58356 [2013-23005]
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58354
Federal Register / Vol. 78, No. 184 / Monday, September 23, 2013 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–23010 Filed 9–20–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
At times, changes in Commission
priorities require alterations in the
scheduling of meeting items.
For further information and to
ascertain what, if any, matters have been
added, deleted or postponed, please
contact the Office of the Secretary at
(202) 551–5400.
Dated: September 18, 2013.
Elizabeth M. Murphy,
Secretary.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
appointment cost for options on the
iShares Russell 2000 Index Fund (IWM).
The text of the proposed rule change is
provided below. (Additions are
italicized; deletions are [bracketed].)
*
*
*
*
*
[FR Doc. 2013–23101 Filed 9–19–13; 11:15 am]
Sunshine Act Meeting
Notice is hereby given, pursuant to
the provisions of the Government in the
Sunshine Act, Public Law 94–409, that
the Securities and Exchange
Commission will hold a Closed Meeting
on Wednesday, September 25, 2013 at
10:00 a.m.
Commissioners, Counsel to the
Commissioners, the Secretary to the
Commission, and recording secretaries
will attend the Closed Meeting. Certain
staff members who have an interest in
the matters also may be present.
The General Counsel of the
Commission, or her designee, has
certified that, in her opinion, one or
more of the exemptions set forth in 5
U.S.C. 552b(c)(3), (5), (7), 9(B) and (10)
and 17 CFR 200.402(a)(3), (5), (7), 9(ii)
and (10), permit consideration of the
scheduled matter at the Closed Meeting.
Commissioner Aguilar, as duty
officer, voted to consider the items
listed for the Closed Meeting in a closed
session.
The subject matter of the Closed
Meeting will be:
Institution and settlement of injunctive
actions;
Institution and settlement of
administrative proceedings; and
Other matters relating to enforcement
proceedings.
Chicago Board Options Exchange,
Incorporated Rules
BILLING CODE 8011–01–P
*
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–70424; File No. SR–CBOE–
2013–088]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Relating to the
Appointment Cost of IWM Options
September 17, 2013.
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
September 13, 2013, 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.
*
*
*
*
Rule 8.3. Appointment of MarketMakers
(a)–(b) No change.
(c) Market-Maker Appointments.
Absent an exemption by the Exchange,
an appointment of a Market-Maker
confers the right to quote electronically
and in open outcry in the MarketMaker’s appointed classes as described
below. Subject to paragraph (e) below, a
Market-Maker may change its appointed
classes upon advance notification to the
Exchange in a form and manner
prescribed by the Exchange.
(i) Hybrid Classes. Subject to
paragraphs (c)(iv) and (e) below, a
Market-Maker can create a Virtual
Trading Crowd (‘‘VTC’’) appointment,
which confers the right to quote
electronically in an appropriate number
of Hybrid classes (as defined in Rule
1.1(aaa)) selected from ‘‘tiers’’ that have
been structured according to trading
volume statistics, except for the AA tier.
All classes within a specific tier will be
assigned an ‘‘appointment cost’’
depending upon its tier location. The
following table sets forth the tiers and
related appointment costs.
Appointment
cost
Hybrid options classes
AA ...
emcdonald on DSK67QTVN1PROD with NOTICES
Tier
• Options on the CBOE Volatility Index (VIX) .........................................................................................................................
• Options on the iShares Russell 2000 Index Fund (IWM) .....................................................................................................
• Options on the NASDAQ 100 Index (NDX) ..........................................................................................................................
• Options on the S&P 100 (OEX) ............................................................................................................................................
• Options on Standard & Poor’s Depositary Receipts (SPY) ..................................................................................................
• Options on the Russell 2000 Index (RUT) ...........................................................................................................................
• Options on the S&P 100 (XEO) ............................................................................................................................................
• Morgan Stanley Retail Index Options (MVR) ........................................................................................................................
• Options on the iPath S&P 500 VIX Short-Term Futures Index ETN (VXX) .........................................................................
• P.M.—Settled options on the Standard & Poor’s 500 (SPXPM) ..........................................................................................
Hybrid Classes 1–60 .................................................................................................................................................................
Hybrid Classes 61–120 .............................................................................................................................................................
Hybrid Classes 121–345 ...........................................................................................................................................................
Hybrid Classes 346–570 ...........................................................................................................................................................
Hybrid Classes 571–999 ...........................................................................................................................................................
All Remaining Hybrid Classes ..................................................................................................................................................
A * ...
B * ...
C * ...
D * ...
E * ...
F * ....
* Excludes Tier AA.
7 17
CFR 200.30–3(a)(27).
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.50
[.50].25
.50
.40
.25
.25
.10
.25
.10
1.0
.10
.05
.04
.02
.01
.001
Federal Register / Vol. 78, No. 184 / Monday, September 23, 2013 / Notices
(ii)–(vi) No change.
(d)–(e) No change.
*
*
*
*
*
The text of the proposed rule change
is also available on the Exchange’s Web
site (https://www.cboe.com/AboutCBOE/
CBOELegalRegulatoryHome.aspx), at
the Exchange’s Office of the Secretary,
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.
emcdonald on DSK67QTVN1PROD with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend the
appointment cost for options on the
iShares Russell 2000 Index Fund (IWM).
IWM options are part of Tier AA and
have a fixed appointment cost of .50.
The Exchange proposes to lower the
appointment cost of IWM options to .25.
While the appointment costs of Tier AA
classes are not subject to quarterly
rebalancing under Rule 8.3(c)(iv), the
Exchange regularly reviews the
appointment costs of Tier AA classes to
ensure that they continue to be
appropriate. The Exchange determines
appointment costs of Tier AA classes
based on several factors, including
competitive forces and trading volume.3
The Exchange believes that the reduced
appointment cost of IWM options is
consistent with its most recent analysis
of these factors. The Exchange believes
that lowering the appointment cost of
IWM options will encourage MarketMakers to select appointments in that
class, and thus enhance competition in
that class. Additionally, the Exchange
believes the lower appointment cost
will similarly promote competition in
other classes, as Market-Makers can
utilize the excess appointment credit of
.25 to select an appointment and quote
electronically in additional Hybrid
option classes. The proposed rule
change will become effective on
September 17, 2013.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to the Exchange
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 prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest.
Additionally, the Exchange believes the
proposed rule change is consistent with
the Section 6(b)(5) 6 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
In particular, the Exchange believes
that lowering the appointment cost of
IWM options will encourage MarketMakers to select appointments in that
class, which may increase liquidity and
enhance competition in that class.
Additionally, the Exchange believes the
lower appointment cost will similarly
promote competition in other classes, as
Market-Makers can utilize the excess
appointment credit of .25 to select an
appointment and quote electronically in
additional Hybrid option classes. The
Exchange believes this may result in
more competitive pricing in IWM and
other Hybrid option classes, which will
promote just and equitable principles of
trade and ultimately benefit investors.
The proposed rule change does not
result in unfair discrimination, as the
lower appointment cost for IWM
options will apply to all Market-Makers.
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. The lower
appointment cost for IWM options will
apply to all Market-Makers. Any
Market-Maker may select an
appointment in IWM options at the
lower appointment cost as long as it has
sufficient appointment credits to cover
the cost. CBOE does not believe the
proposed rule change will detriment
market participants on other exchanges,
as it relates solely to Market-Maker
appointment costs of options classes
listed on CBOE. Market participants on
other exchanges are welcome to become
CBOE Trading Permit Holders as
Market-Makers and trade at CBOE if
they determine that this proposed rule
change has made CBOE more attractive
or favorable.
CBOE believes that the proposed rule
change will relieve any burden on, or
otherwise promote, competition. As
discussed above, the Exchange believes
the lower appointment cost for IWM
options will promote competition in
IWM options and other option classes.
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 Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 7 and Rule
19b–4(f)(6) thereunder.8 Because the
proposed rule change does not: (i)
Significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
prior to 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, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)(iii)
thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) 9 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b–4(f)(6)(iii),10 the
Commission may designate a shorter
time if such action is consistent with the
protection of investors and the public
interest. The Exchange has asked the
Commission to waive the 30-day
operative delay so that the proposal may
7 15
3 Similarly,
the appointment costs of classes in all
tiers other than Tier AA are based on trading
volume statistics. See Rule 8.3(c)(i).
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4 15
U.S.C. 78f(b).
5 15 U.S.C. 78f(b)(5).
6 Id.
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U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
9 Id.
10 17
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CFR 240.19b–4(f)(6)(iii).
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58356
Federal Register / Vol. 78, No. 184 / Monday, September 23, 2013 / Notices
become operative immediately upon
filing. According to the Exchange, the
proposed rule change lowers an
appointment cost, so it will not cause
any Market-Maker to be out of
compliance with the rules. The
Exchange stated that waiving the 30-day
operative delay period will allow
Market-Makers with an appointment in
IWM to obtain appointments in
additional options classes in which they
want to make markets as soon as
possible and thus promote competition
in those classes without undue delay.
Based on the Exchange’s statements, the
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest. Accordingly, the
Commission hereby grants the
Exchange’s request and designates the
proposal operative upon filing.11
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. If the
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B) 12 of the Act to
determine whether the proposed rule
change 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:
emcdonald on DSK67QTVN1PROD with NOTICES
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–2013–088 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–2013–088. This file
number should be included on the
11 For
purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
12 15 U.S.C. 78s(b)(2)(B).
VerDate Mar<15>2010
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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 Section, 100 F Street NE.,
Washington, DC 20549–1090 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing will also 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–
2013–088 and should be submitted on
or before October 15, 2013.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–23005 Filed 9–20–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–70425; File No. SR–
NYSEArca–2013–90]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending Rule 6.91 To
Specify That LMMs Receive Execution
Allocations of Incoming Electronic
Complex Orders and Complex Order
Auction Eligible Orders in Accordance
With the Guaranteed Participation
Provision of Rule 6.76A(a)(1)(A),
Without Any Exceptions
September 17, 2013.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Rule 6.91 to specify that LMMs receive
execution allocations of incoming
Electronic Complex Orders and
Complex Order Auction (‘‘COA’’)
eligible orders in accordance with the
guaranteed participation provision of
Rule 6.76A(a)(1)(A), without any
exceptions. 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,
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 Exchange is proposing to amend
Rules 6.91(a)(2)(i), (a)(2)(ii), (c)(6)(A),
and (c)(6)(D) to specify that LMMs
receive execution allocations of the
individual components of a legged out
incoming Electronic Complex Order or
COA-eligible order in accordance with
the guaranteed participation provision
of Rule 6.76A(a)(1)(A), without any
exceptions, which is how the Exchange
currently operates.
13 17
2 15
1 15
3 17
PO 00000
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on
September 12, 2013, 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 and II below, which Items have
been prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
Frm 00090
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U.S.C. 78a.
CFR 240.19b–4.
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]]>Agencies
[Federal Register Volume 78, Number 184 (Monday, September 23, 2013)]
[Notices]
[Pages 58354-58356]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-23005]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-70424; File No. SR-CBOE-2013-088]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change Relating to the Appointment Cost of IWM Options
September 17, 2013.
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 September 13, 2013, 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 Exchange proposes to amend the appointment cost for options on
the iShares Russell 2000 Index Fund (IWM). The text of the proposed
rule change is provided below. (Additions are italicized; deletions are
[bracketed].)
* * * * *
Chicago Board Options Exchange, Incorporated Rules
* * * * *
Rule 8.3. Appointment of Market-Makers
(a)-(b) No change.
(c) Market-Maker Appointments. Absent an exemption by the Exchange,
an appointment of a Market-Maker confers the right to quote
electronically and in open outcry in the Market-Maker's appointed
classes as described below. Subject to paragraph (e) below, a Market-
Maker may change its appointed classes upon advance notification to the
Exchange in a form and manner prescribed by the Exchange.
(i) Hybrid Classes. Subject to paragraphs (c)(iv) and (e) below, a
Market-Maker can create a Virtual Trading Crowd (``VTC'') appointment,
which confers the right to quote electronically in an appropriate
number of Hybrid classes (as defined in Rule 1.1(aaa)) selected from
``tiers'' that have been structured according to trading volume
statistics, except for the AA tier. All classes within a specific tier
will be assigned an ``appointment cost'' depending upon its tier
location. The following table sets forth the tiers and related
appointment costs.
------------------------------------------------------------------------
Tier Hybrid options classes Appointment cost
------------------------------------------------------------------------
AA.......... Options on the CBOE .50
Volatility Index (VIX).
Options on the iShares [.50].25
Russell 2000 Index Fund (IWM).
Options on the NASDAQ 100 .50
Index (NDX).
Options on the S&P 100 .40
(OEX).
Options on Standard & .25
Poor's Depositary Receipts (SPY).
Options on the Russell .25
2000 Index (RUT).
Options on the S&P 100 .10
(XEO).
Morgan Stanley Retail .25
Index Options (MVR).
Options on the iPath S&P .10
500 VIX Short-Term Futures Index
ETN (VXX).
P.M.--Settled options on 1.0
the Standard & Poor's 500 (SPXPM).
A *......... Hybrid Classes 1-60................ .10
B *......... Hybrid Classes 61-120.............. .05
C *......... Hybrid Classes 121-345............. .04
D *......... Hybrid Classes 346-570............. .02
E *......... Hybrid Classes 571-999............. .01
F *......... All Remaining Hybrid Classes....... .001
------------------------------------------------------------------------
* Excludes Tier AA.
[[Page 58355]]
(ii)-(vi) No change.
(d)-(e) No change.
* * * * *
The text of the proposed rule change is also available on the
Exchange's Web site (https://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, 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 the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the appointment cost for options on
the iShares Russell 2000 Index Fund (IWM). IWM options are part of Tier
AA and have a fixed appointment cost of .50. The Exchange proposes to
lower the appointment cost of IWM options to .25. While the appointment
costs of Tier AA classes are not subject to quarterly rebalancing under
Rule 8.3(c)(iv), the Exchange regularly reviews the appointment costs
of Tier AA classes to ensure that they continue to be appropriate. The
Exchange determines appointment costs of Tier AA classes based on
several factors, including competitive forces and trading volume.\3\
The Exchange believes that the reduced appointment cost of IWM options
is consistent with its most recent analysis of these factors. The
Exchange believes that lowering the appointment cost of IWM options
will encourage Market-Makers to select appointments in that class, and
thus enhance competition in that class. Additionally, the Exchange
believes the lower appointment cost will similarly promote competition
in other classes, as Market-Makers can utilize the excess appointment
credit of .25 to select an appointment and quote electronically in
additional Hybrid option classes. The proposed rule change will become
effective on September 17, 2013.
---------------------------------------------------------------------------
\3\ Similarly, the appointment costs of classes in all tiers
other than Tier AA are based on trading volume statistics. See Rule
8.3(c)(i).
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange 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 prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and, in general, to protect investors and the public interest.
Additionally, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \6\ requirement that the rules of
an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(5).
\6\ Id.
---------------------------------------------------------------------------
In particular, the Exchange believes that lowering the appointment
cost of IWM options will encourage Market-Makers to select appointments
in that class, which may increase liquidity and enhance competition in
that class. Additionally, the Exchange believes the lower appointment
cost will similarly promote competition in other classes, as Market-
Makers can utilize the excess appointment credit of .25 to select an
appointment and quote electronically in additional Hybrid option
classes. The Exchange believes this may result in more competitive
pricing in IWM and other Hybrid option classes, which will promote just
and equitable principles of trade and ultimately benefit investors. The
proposed rule change does not result in unfair discrimination, as the
lower appointment cost for IWM options will apply to all Market-Makers.
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. The lower appointment cost for
IWM options will apply to all Market-Makers. Any Market-Maker may
select an appointment in IWM options at the lower appointment cost as
long as it has sufficient appointment credits to cover the cost. CBOE
does not believe the proposed rule change will detriment market
participants on other exchanges, as it relates solely to Market-Maker
appointment costs of options classes listed on CBOE. Market
participants on other exchanges are welcome to become CBOE Trading
Permit Holders as Market-Makers and trade at CBOE if they determine
that this proposed rule change has made CBOE more attractive or
favorable.
CBOE believes that the proposed rule change will relieve any burden
on, or otherwise promote, competition. As discussed above, the Exchange
believes the lower appointment cost for IWM options will promote
competition in IWM options and other option classes.
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 Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \7\ and Rule 19b-4(f)(6) thereunder.\8\
Because the proposed rule change does not: (i) Significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
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, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\8\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \9\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\10\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may
[[Page 58356]]
become operative immediately upon filing. According to the Exchange,
the proposed rule change lowers an appointment cost, so it will not
cause any Market-Maker to be out of compliance with the rules. The
Exchange stated that waiving the 30-day operative delay period will
allow Market-Makers with an appointment in IWM to obtain appointments
in additional options classes in which they want to make markets as
soon as possible and thus promote competition in those classes without
undue delay. Based on the Exchange's statements, the Commission
believes that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest. Accordingly, the
Commission hereby grants the Exchange's request and designates the
proposal operative upon filing.\11\
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\9\ Id.
\10\ 17 CFR 240.19b-4(f)(6)(iii).
\11\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \12\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\12\ 15 U.S.C. 78s(b)(2)(B).
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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 email to rule-comments@sec.gov. Please include
File Number SR-CBOE-2013-088 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-2013-088. 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 Section, 100 F Street
NE., Washington, DC 20549-1090 on official business days between the
hours of 10:00 a.m. and 3:00 p.m. Copies of the filing will also 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-2013-088 and should be submitted on or before October 15, 2013.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-23005 Filed 9-20-13; 8:45 am]
BILLING CODE 8011-01-P
