[Federal Register Volume 75, Number 192 (Tuesday, October 5, 2010)]
[Notices]
[Pages 61538-61539]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-24895]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63001; File No. SR-CBOE-2010-85]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Increase the Class Quoting Limit in One Option Classes
September 28, 2010.
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 16, 2010, the Chicago Board Options Exchange,
Incorporated (``CBOE'' or ``Exchange'') filed with the Securities and
Exchange Commission (``Commission'') the proposed rule change as
described in Items I and II, which Items have been prepared by the
CBOE. The Exchange has designated this proposal as one constituting a
stated policy, practice, or interpretation with respect to the meaning,
administration, or enforcement of an existing rule under Section
19(b)(3)(A)(i) of the Act,\3\ and Rule 19b-4(f)(1) 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)(i).
\4\ 17 CFR 240.19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to increase the class quoting limit in one
option class. The text of the proposed rule change is available on
CBOE's Web site (http://www.cboe.org/legal), at the CBOE'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 parts of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
CBOE Rule 8.3A, Maximum Number of Market Participants Quoting
Electronically per Product, establishes class quoting limits (``CQLs'')
for each class traded on the Hybrid Trading System.\5\ A CQL is the
maximum number of quoters that may quote electronically in a given
product and Rule 8.3A, Interpretation .01(a) provides that the current
levels are generally established at 50.
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\5\ See Rule 8.3A.01.
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In addition, Rule 8.3A, Interpretation .01(b) provides a procedure
by which the President of the Exchange may increase the CQL for an
existing or new product. In this regard, the President of the Exchange
may increase the CQL in a particular product when he deems it
appropriate. The effect of an increase in the CQL is procompetitive in
that it increases the number of market participants that may quote
electronically in a product. The purpose of this filing is to increase
the CQL in options on the CBOE Volatility Index (VIX) from its current
limit of 50 to 60, which CBOE's President has determined would be
appropriate.\6\ Increasing the CQL also may enhance the liquidity
offered in the option class. Lastly, CBOE represents that it has the
systems capacity to support this increase in the CQL.
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\6\ CBOE's President has determined that this increase would be
appropriate, in part, due to the relocation of several option
classes, including VIX, to a larger trading station on the trading
floor which may enhance the liquidity offered in the option class.
E-mail dated September 28, 2010, from Patrick Sexton, Associate
General Counsel, CBOE.
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2. Statutory Basis
CBOE believes the proposed rule change is consistent with the Act
and the rules and regulations under the Act applicable to a national
securities exchange and, in particular, the requirements of section
6(b) of the Act.\7\ Specifically, the Exchange believes the proposed
rule change is consistent with the Section 6(b)(5) \8\ requirements
that the rules of an exchange be designed to promote just and equitable
principles of trade, to prevent fraudulent and manipulative acts and,
in general, to protect investors and the public interest. As indicated
above, the Exchange believes that increasing the CQL in this
[[Page 61539]]
option class is procompetitive and may enhance the liquidity offered.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
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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 not necessary or appropriate in furtherance of
the purposes of the Exchange Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange neither received nor solicited written comments on the
proposal.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing proposed rule change will take effect upon filing
with the Commission pursuant to Section 19(b)(3)(A)(i) of the Act \9\
and Rule 19b-4(f)(1) thereunder,\10\ because it constitutes a stated
policy, practice, or interpretation with respect to the meaning,
administration, or enforcement of an existing rule.
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\9\ 15 U.S.C. 78s(b)(3)(A)(i).
\10\ 17 CFR 240.19b-4(f)(1).
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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.
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-CBOE-2010-85 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2010-85. 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 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 a.m. and 3 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-2010-85 and should be submitted on or before October 26, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-24895 Filed 10-4-10; 8:45 am]
BILLING CODE 8010-01-P