Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Withdrawal of Proposed Rule Change To Amend the Fees Schedule, 77037-77038 [2015-31179]
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Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices
among other things, to promote just and
equitable principles of trade, 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. The Exchange believes
that the proposed rule change to make
the Series 57 Examination the qualifying
exam for individuals engaged solely in
proprietary trading is appropriate
because the Series 57 Examination
addresses industry topics that establish
the foundation for the regulatory and
procedural knowledge necessary for
such individuals to appropriately
register under Exchange rules. In
addition, the Series 57 Examination is
expected to be shared by other
exchanges and become the industry
standard.14 Accordingly, adopting the
Series 57 Examination will help to
promote consistency in examination
requirements and uniformity across
markets.
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. The
proposed rule change does not impose
any additional examination burdens on
persons who are already registered.
There is no obligation to take the Series
57 examination in order to continue in
their present duties, so the proposed
rule change is not expected to
disadvantage current registered persons
relative to new entrants in this regard.
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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
The Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 15 and Rule
19b–4(f)(6) thereunder.16 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) 17 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b4(f)(6)(iii),18 the Commission
may designate a shorter time if such
action is consistent with the protection
of investors and the public interest.
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) 19 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:
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. Copies of
the filing will also be available for
inspection and copying at the NYSE’s
principal office and on its Internet Web
site at www.nyse.com. 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–
NYSEMKT–2015–99 and should be
submitted on or before January 4, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015–31279 Filed 12–10–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
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–
NYSEMKT–2015–99 on the subject line.
[Release No. 34–76575; File No. SR–CBOE–
2015–101]
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEMKT–2015–99. 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
December 7, 2015.
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Withdrawal of
Proposed Rule Change To Amend the
Fees Schedule
On November 2, 2015, the Chicago
Board Options Exchange, Incorporated
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 1 and Rule 19b–4 thereunder,2 a
proposed rule change to amend the
Exchange’s fees schedule. The proposed
rule change was published for comment
in the Federal Register on November 25,
2015.3 The Commission received no
comment letters on the proposal. On
December 1, 2015, the Exchange
20 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4
3 See Securities Exchange Act Release No. 34–
76442 (November 16, 2015), 80 FR 72761.
1 15
supra, note 7.
U.S.C. 78s(b)(3)(A)(iii).
16 17 CFR 240.19b–4(f)(6).
14 See
17 17
15 15
18 17
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14:55 Dec 10, 2015
CFR 240.19b–4(f)(6).
CFR 240.19b–4(f)(6)(iii).
19 15 U.S.C. 78s(b)(2)(B).
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Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices
withdrew the proposed rule change
(SR–CBOE–2015–101).
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.4
Brent J. Fields,
Secretary.
[FR Doc. 2015–31179 Filed 12–10–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–76585; File No. SR–CBOE–
2015–107]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of a
Proposed Rule Change, as Modified by
Amendment No. 1 Thereto, Relating to
Price Protection Mechanisms
December 8, 2015.
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 November
24, 2015, 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, II and III
below, which Items have been prepared
by the Exchange. On December 4, 2015,
the Exchange filed Amendment No. 1 to
the proposal.3 The Commission is
publishing this notice to solicit
comments on the proposed rule change,
as modified by Amendment No. 1, from
interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to enhance
current and adopt new price protection
mechanisms for orders and quotes.
The text of the proposed rule change
is 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.
4 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 In Amendment No. 1, the Exchange proposed
changes to amend the proposed rule text of Rule
6.53C, Interpretation and Policy .08(c) in Exhibit 5
and the purpose and statutory basis sections of each
of the Form 19b–4 and Exhibit 1 regarding the
applicability of the proposed enhancement to the
debit/credit price reasonability check to index
options with European-style exercises. The
Exchange also amended Item 7(d) of the Form 19b–
4 to delete redundant language.
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II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
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 Exchange has in place various
price check mechanisms that are
designed to prevent incoming orders
from automatically executing at
potentially erroneous prices.4 These
mechanisms are designed to help
maintain a fair and orderly market by
mitigating potential risks associated
with orders trading at prices that are
extreme and potentially erroneous. The
Exchange proposes to adopt Rule 6.14,
which was previously deleted, and
amend Rule 6.53C, Interpretation and
Policy .08, to add new, as well as
enhance current, price protection
mechanisms for orders and quotes to
help further prevent potentially
erroneous executions.
Put Strike Price and Call Underlying
Value Checks
Proposed Rule 6.14(a) provides price
protections for simple orders to buy put
and call options based on the strike
price or underlying value, respectively.
The proposed rule provides that the
System 5 will reject back to the Trading
Permit Holder a quote 6 or buy limit
order for (i) a put if the price of the
quote bid or order is equal to or greater
than the strike price of the option or (ii)
a call if the price of the quote bid or
4 See, e.g., Rules 6.12(a)(3) and (4) (limit order
price parameters), 6.13(b)(v) (market-width and
drill-through price check parameters), 6.53C,
Interpretation and Policy .08 (price check
parameters for complex orders), and 8.18 (quote risk
monitor).
5 The ‘‘System’’ refers to the Exchange’s Hybrid
Trading System, which is (i) the Exchange’s trading
platform that allows Market-Makers to submit
electronic quotes in their appointed classes and (ii)
any connectivity to the foregoing trading platform
that is administered by or on behalf of the
Exchange, such as a communications hub. See Rule
1.1(aaa).
6 The term quote includes both sides of a quote
that is entered as a two-sided quote.
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order is equal to or greater than the
consolidated last sale price of the
underlying security, with respect to
equity and exchange-traded fund
(‘‘ETF’’) options, or the last
disseminated underlying index value,
with respect to index options.7
With respect to put options, a Trading
Permit Holder seeks to buy an option
that could be exercised into the right to
sell the underlying. The value of a put
can never exceed the strike price of the
option, even if the underlying goes to
zero. For example, one put for stock
ABC with a strike price of $50 gives the
holder the right to sell 100 shares of
ABC for $50, no more or less. Therefore,
it would be illogical to pay more than
$50 for the right to sell shares of ABC,
regardless of the price of ABC. Pursuant
to proposed Rule 6.14(a)(i)(A), the
Exchange would deem any put bid or
buyer order with a price that equals or
exceeds the strike price of the option to
be erroneous, and the Exchange believes
it would be appropriate to reject these
bids and buy orders.
With respect to call options, a Trading
Permit Holder seeks to buy an option
that could be exercised into the right to
buy the underlying. The Exchange does
not believe that a derivative product
that conveys the right to buy the
underlying should ever be priced higher
than the prevailing value of the
underlying itself. In that case, a market
participant could just purchase the
underlying at the prevailing value rather
than pay a larger amount for the call.
Accordingly, pursuant to proposed Rule
6.14(a)(i)(B), the Exchange believes it is
appropriate to reject bids or buy orders
for call options with prices that are
equal to or in excess of the value of the
underlying. As an example, suppose a
Trading Permit Holder submits Order 1
to buy an ABC call for $8 and Order 2
to buy an ABC call for $11 when the last
sale price for stock ABC is $10. Because
the price to buy for Order 2 is greater
than the last sale price of the
underlying, the System will reject Order
2. The System will either execute or
book Order 1 in accordance with
CBOE’s rules.
Pursuant to the proposed rule, with
respect to equity and ETF options, the
Exchange would use the consolidated
last sale price of the underlying
security, with respect to equity and ETF
7 These price checks would also apply to buy
auction responses submitted in the various
Exchange auctions, such as the Hybrid Agency
Liaison (‘‘HAL’’) and the Automated Improvement
Mechanism (‘‘AIM’’). See proposed Rule 6.14(a)(iii).
The Exchange believes responses can cause
erroneous executions in the same manner as quotes
and orders and thus should be subject to this
proposed price protection to further help prevent
potentially erroneous executions.
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]]>Agencies
[Federal Register Volume 80, Number 238 (Friday, December 11, 2015)]
[Notices]
[Pages 77037-77038]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-31179]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-76575; File No. SR-CBOE-2015-101]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Withdrawal of Proposed Rule Change To Amend the
Fees Schedule
December 7, 2015.
On November 2, 2015, the Chicago Board Options Exchange,
Incorporated (``Exchange'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 \1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change to amend the Exchange's fees schedule. The
proposed rule change was published for comment in the Federal Register
on November 25, 2015.\3\ The Commission received no comment letters on
the proposal. On December 1, 2015, the Exchange
[[Page 77038]]
withdrew the proposed rule change (SR-CBOE-2015-101).
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4
\3\ See Securities Exchange Act Release No. 34-76442 (November
16, 2015), 80 FR 72761.
\4\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\4\
Brent J. Fields,
Secretary.
[FR Doc. 2015-31179 Filed 12-10-15; 8:45 am]
BILLING CODE 8011-01-P
