[Federal Register Volume 76, Number 70 (Tuesday, April 12, 2011)]
[Notices]
[Pages 20390-20392]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-8621]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64197; File No. SR-CBOE-2011-034]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated: Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Relating to Extension of Waiver of Transaction Fee for
Public Customer Orders in SPY Options Executed in Open Outcry or in the
Automated Improvement Mechanism
April 6, 2011.
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 March 31, 2011, Chicago Board Options Exchange, Incorporated
(``CBOE'' or the ``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 CBOE. 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
Chicago Board Options Exchange, Incorporated (``CBOE'' or
``Exchange'')
[[Page 20391]]
proposes to amend its Fees Schedule to extend through June 30, 2011, a
waiver of the transaction fee for public customer orders in options on
Standard & Poor's Depositary Receipts that are executed in open outcry
or in the Automated Improvement Mechanism. The text of the proposed
rule change is available on the Exchange's Web site (http://www.cboe.org/legal), at the Exchange's Office of the Secretary and at
the Commission.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, CBOE 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. CBOE 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, Proposed Rule Change
(a) Purpose
The Exchange currently waives the $.18 per contract transaction fee
for public customer (``C'' origin code) orders in options on Standard &
Poor's Depositary Receipts (``SPY options'') that are executed in open
outcry or in the Automated Improvement Mechanism (``AIM'').\3\ This fee
waiver is due to expire on March 31, 2011. The Exchange proposes to
extend the fee waiver through June 30, 2011.\4\ The proposed fee waiver
is intended to attract more customer volume on the Exchange in this
product.
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\3\ See Securities Exchange Act Release No. 34-62902 (September
14, 2010), 75 FR 57313 (September 20, 2010), Securities Exchange Act
Release No. 34-63422 (December 3, 2010), 75 FR 76770 (December 9,
2010) and CBOE Fees Schedule, footnote 8. AIM is an electronic
auction system that exposes certain orders electronically in an
auction to provide such orders with the opportunity to receive an
execution at an improved price. AIM is governed by CBOE Rule 6.74A.
\4\ The Exchange notes that transaction fees are also currently
waived for customer orders of 99 contracts or less in ETF (including
SPY options), ETN and HOLDRs options. See CBOE Fees Schedule,
footnote 9.
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(b) Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) of the Securities Exchange Act of 1934 (``Act''),\5\ in
general, and furthers the objectives of Section 6(b)(4) \6\ of the Act
in particular, in that it is designed to provide for the equitable
allocation of reasonable dues, fees, and other charges among CBOE
Trading Permit Holders and other persons using its facilities. The
Exchange believes the proposed extension of the fee waiver is equitable
because the fee waiver would apply uniformly to all public customers
trading SPY options. The Exchange believes the proposed extension of
the fee waiver is reasonable because it would continue to provide cost
savings during the extended waiver period for public customers trading
SPY options. Further, the Exchange believes the proposed fee waiver is
consistent with other fees assessed by the Exchange. Specifically, the
Exchange assesses manually executed broker-dealer orders a different
rate ($.25 per contract) as compared to electronically executed broker-
dealer orders ($.45 per contract).\7\ Other exchange fee schedules also
distinguish between electronically and non-electronically executed
orders.\8\
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(4).
\7\ See CBOE Fees Schedule, Section 1.
\8\ NASDAQ OMX PHLX, Inc. categorizes its equity options
transaction fees for Specialists, ROTs, SQTs, RSQTs and Broker-
Dealers as either electronic or non-electronic. See NASDAQ OMX PHLX
Fees Schedule, Equity Options Fees. NYSE Amex, Inc. categorizes its
options transaction fees for Non-NYSE Amex Options Market Makers,
Broker-Dealers, Professional Customers, Non BD Customers and Firms
as either electronic or manual. See NYSE Amex Options Fees Schedule,
Trade Related Charges. NYSE Arca, Inc. categorizes its options
transaction fees for Customers, Firms and Broker-Dealers as either
electronic or manual. See NYSE Arca Options Fees Schedule, Trade
Related Charges.
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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 that is not necessary or appropriate in
furtherance of purposes of the Act.
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 foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \9\ and subparagraph (f)(2) of Rule 19b-4 \10\
thereunder. 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.
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 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-CBOE-2011-034 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.
All submissions should refer to File Number SR-CBOE-2011-034. 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 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
[[Page 20392]]
Number SR-CBOE-2011-034 and should be submitted on or before May 3,
2011.
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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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-8621 Filed 4-11-11; 8:45 am]
BILLING CODE 8011-01-P