[Federal Register Volume 73, Number 155 (Monday, August 11, 2008)]
[Notices]
[Pages 46667-46668]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-18367]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58289; File No. SR-ISE-2008-62]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule
Change To Amend Exchange Rules Related to the Imposition of Fines for
Minor Rule Violations
August 1, 2008.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on July 30, 2008, the International Securities Exchange, LLC (``ISE''
or the ``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The Exchange
has designated the proposed rule change as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and
Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective
upon filing with the Commission. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The ISE proposes to amend Rule 1614--Imposition of Fines for Minor
Rule Violations to increase the summary fines for violations of Rule
412--Position Limits. The text of the proposed rule change is available
at ISE, http://www.ise.com, and the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to increase and strengthen the sanctions
imposed pursuant to its Minor Rule Violation Plan (``MRVP'') in
connection with any member or customer who exceeds the Exchange's
position limits in accordance with Exchange Rule 412. The Exchange
believes that increasing the fine levels specified, consolidating
individual members, member organizations, and customers into one
category, and lengthening the surveillance period from a 12-month
period to a rolling 24-month period will serve as an effective
deterrent to such violative conduct. In addition, the Exchange, as a
member of the Intermarket Surveillance Group (``ISG''), as well as
certain other self-regulatory organizations (``SROs'') on October 29,
2007 executed and filed with the Commission a final version of an
Agreement pursuant to Section 17(d) of the Act (the ``17d-2
Agreement'').\5\ The members of the ISG intend to enter into an
amendment to the 17d-2 Agreement in the near future concerning the
surveillance and sanctions of position limit violations. As such, the
SROs have agreed that their respective rules concerning position limits
regarding options contracts are common rules. As a result, the proposal
to amend the Exchange's MRVP will further result in consistency in
sanctions among the SROs that are signatories to the 17d-2 Agreement
and the forthcoming amendment concerning position limit violations.
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\5\ See Letter to Richard Holley, Division of Market Regulation,
Securities and Exchange Commission from Nyieri Nazarian, Assistant
General Counsel, American Stock Exchange, October 29, 2007.
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the requirement under Section 6(b) of the Act,\6\ in general, and
furthers the objectives of Section 6(b)(5) of the Act,\7\ in
particular, in that it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, and to protect investors and the public interest
in that it is designed 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, this proposed
rule change will promote consistency in minor rule violations and
respective SRO reporting obligations as set forth pursuant to Section
240.19d-1(c)(2) of the Act.\8\
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
\8\ 17 CFR 240.19d-1(c)(2).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change will not 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 has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any written
[[Page 46668]]
comments from members or other interested parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The proposed rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \9\ and Rule 19b-4(f)(6) thereunder \10\ because
the foregoing proposed rule change: (1) Does not significantly affect
the protection of investors or the public interest; (2) does not impose
any significant burden on competition; and (3) by its terms, does not
become operative for 30 days after the date of filing, or such shorter
time as the Commission may designate if consistent with the protection
of investors and the public interest.\11\
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
\11\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the self-regulatory organization to give the
Commission notice of its intent to file the proposed rule change,
along with a brief description and text of 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. ISE has satisfied this requirement.
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The Exchange has asked the Commission to waive the 30-day operative
delay and designate the proposed rule change as operative upon filing.
The Commission hereby grants the Exchange's request and believes that
doing so is consistent with the protection of investors and the public
interest.\12\ The Exchange's proposed rule change is based on a similar
proposal that was previously approved by the Commission \13\ and does
not raise any novel or significant issues. Therefore, the Commission
designates the proposed rule change operative upon filing.
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\12\ For purposes only of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
\13\ See Securities Exchange Act Release No. 58119 (July 8,
2008), 73 FR 40646 (July 15, 2008) (SR-CBOE-2008-53).
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At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate 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 (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-ISE-2008-62 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, Station Place, 100 F Street, NE., Washington,
DC 20549-1090.
All submissions should refer to File Number SR-ISE-2008-62. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://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 inspection
and copying in the Commission's Public Reference Room, 100 F Street,
NE., Washington, DC 20549, on official business days between the hours
of 10 a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal 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 publicly available. All
submissions should refer to File Number SR-ISE-2008-62 and should be
submitted on or before September 2, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-18367 Filed 8-8-08; 8:45 am]
BILLING CODE 8010-01-P