[Federal Register Volume 75, Number 71 (Wednesday, April 14, 2010)]
[Notices]
[Pages 19451-19452]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-8540]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-61865; File No. SR-ISE-2010-29]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change Relating To Amending the Direct Edge ECN Fee Schedule
April 7, 2010.
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 April 5, 2010, International Securities Exchange, LLC (``ISE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II
and III 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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Direct Edge ECN's (``DECN'') fee
schedule for ISE Members \3\ to (i) eliminate a rebate on EDGX for
securities priced less than $1; and (ii) to lower the removal rate on
EDGX for securities priced less than $1. All of the changes described
herein are applicable to ISE Members. The text of the proposed rule
change is available on ISE's Web site at http://www.ise.com, on
[[Page 19452]]
the Commission's Web site at http://www.sec.gov, and at the
Commission's Public Reference Room.
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\3\ References to ISE Members in this filing refer to DECN
Subscribers who are ISE Members.
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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
DECN, a facility of ISE, operates two trading platforms, EDGX and
EDGA.\4\
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\4\ This fee filing relates to the trading facility operated by
ISE and not EDGA Exchange, Inc. and EDGX Exchange, Inc. Direct Edge
ECN LLC (EDGA and EDGX) will cease to operate in its capacity as an
electronic communications network following the commencement of
operations of EDGA Exchange, Inc. and EDGX Exchange, Inc. as
national securities exchanges.
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The Exchange is proposing to: (i) Eliminate the current rebate of
0.15% of the total dollar value of the transaction (number of shares
multiplied by price) for securities priced less than $1.00; and (ii)
lower the removal rate for securities priced less than $1 from .30% of
the total dollar value of the transaction to 0.10% of the total dollar
value of the transaction. This is being done because: (i) There was not
an appropriate relationship between the size of the rebate offered and
the minimum trading increment for securities priced less than $1; and
(2) the Exchange is seeking to incentivize the removal of liquidity
from EDGX in securities priced less than $1.00.
The changes discussed in this filing will become operative on April
5, 2010.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 of the Act,\5\ in general, and
furthers the objectives of Section 6(b)(4),\6\ in particular, as it is
designed to provide for the equitable allocation of reasonable dues,
fees and other charges among its members and other persons using its
facilities. ISE notes that DECN operates in a highly competitive market
in which market participants can readily direct order flow to competing
venues if they deem fee levels at a particular venue to be excessive.
The proposed rule change reflects a competitive pricing structure
designed to incent market participants to direct their order flow to
DECN. Finally, the Exchange believes that the proposed rates are
equitable in that they apply uniformly to all Members and provide
higher rebates for higher volume thresholds, resulting from lower
administrative costs. ISE believes the fees and credits remain
competitive with those charged by other venues and therefore continue
to be reasonable and equitably allocated to those members that opt to
direct orders to DECN rather than competing venues.
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\5\ 15 U.S.C. 78f.
\6\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does 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 unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3) of the Act \7\ and Rule 19b-4(f)(2) \8\ thereunder. At any
time within 60 days of the filing of such 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.
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\7\ 15 U.S.C. 78s(b)(3).
\8\ 17 CFR 240.19b-4(f)(2).
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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 (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-ISE-2010-29 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-ISE-2010-29. 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,\9\ 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 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 No. SR-ISE-2010-29 and should be
submitted on or before May 5, 2010.
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\9\ The text of the proposed rule change is available on the
Commission's Web site at http://www.sec.gov.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-8540 Filed 4-13-10; 8:45 am]
BILLING CODE 8011-01-P