13690 Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See CBOE Fees Schedule, Section 20. See, also, 

Securities Exchange Act Release No. 63701 (January 

11, 2011), 76 FR 2934 (January 18, 2011) (SR– 

CBOE–2010–116) and Securities Exchange Act 

Release No. 62793 (August 30, 2010), 75 FR 54408 

(September 7, 2010) (SR–CBOE–2010–076). 

4The Floor Broker Workstation is a system for 

electronically entering and managing orders on the 

Exchange floor. Floor Broker Workstations are 

operated by Floor Brokers. 

5 15 U.S.C. 78f(b). 

6 15 U.S.C. 78f(b)(4). 

7 15 U.S.C. 78s(b)(3)(A)(ii). 

8 17 C.F.R. 240.19b–4(f)(2). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64057; File No. SR–CBOE– 

2011–019] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Modify the CBOE Fees 

Schedule 

March 8, 2011. 

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 February 

25, 2011 [sic], 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 and II 

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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to modify the 

Fees Schedule to amend its linkage fees. 

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, the 

self-regulatory organization 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 those 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 

Currently, when the Exchange 

receives a customer order that has an 

original size of 500 or more contracts 

that is routed for execution, in whole or 

in part, to one or more exchanges in 

connection with the Options Order 

Protection and Locked/Crossed Market 

Plan (a ‘‘Customer Linkage 

Transaction’’), the Exchange charges 

$0.35 per contract in addition to the 

customary CBOE execution charges.3

The Exchange proposes to reduce the 

qualifying customer order size from 500 

or more contracts to 100 or more 

contracts. This change will allow the 

Exchange to pass through some of the 

transaction costs incurred by the 

Exchange associated with the execution 

and handling of larger orders. 

The Exchange further proposes to 

eliminate the flat $0.35 per contract fee 

for Customer Linkage Transactions, and 

instead pass through the actual 

transaction fee(s) assessed on the 

transaction(s) by the exchange(s) to 

which the order was routed, minus a 

$0.05 per contract discount. These 

changes allow the Exchange to more 

accurately pass through some of the 

transaction costs incurred by the 

Exchange associated with Customer 

Linkage Transactions while still offering 

an added incentive to route orders to 

CBOE. 

The Exchange does not propose to 

collect these fees for orders initially 

routed for manual handling by CBOE 

Floor Brokers. More specifically, the 

Exchange will exempt from these passthrough fees customer orders that 

originate from the trading floor via an 

Exchange sponsored terminal like a 

Floor Broker Workstation.4 The primary 

objective of the fee change is to recoup 

some of the costs associated with large 

electronic orders that are initially 

transmitted to CBOE by parties who, in 

many instances, could be seeking to 

avoid being assessed another market’s 

transaction fees. Orders that are initially 

routed to CBOE Floor Brokers are not 

attempting to avoid fees since they incur 

brokerage commission charges in 

connection with manual handling. 

Rather, orders that are handled by CBOE 

Floor Brokers are large, complex orders 

that are primarily executed on the 

CBOE, which only are transmitted to 

away markets if, during their execution 

on CBOE, it is necessary to sweep some 

away markets. 

The proposed fee change will take 

effect on March 1, 2011. 

2. Statutory Basis 

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 the passing through 

of the actual transaction fees assessed 

on away exchanges for Customer 

Linkage Transactions is designed to 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among CBOE Trading Permit Holders 

and other persons using Exchange 

facilities. Exempting customer orders 

that originate from an Exchangesponsored terminal from the passthrough fees is equitable because Floor 

Brokers and their customers are already 

assessed a number of fees in connection 

with trading on the Exchange Floor. 

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 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 proposed rule change is 

designated by the Exchange as 

establishing or changing a due, fee, or 

other charge, thereby qualifying for 

effectiveness on filing pursuant to 

Section 19(b)(3)(A)(ii) 7 of the Act and 

subparagraph (f)(2) of Rule 19b–4 8

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. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

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Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / Notices 13691 

9 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3The product measures latency of orders whether 

the orders are rejected, executed or partially 

executed. 

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 rulecomments@sec.gov. Please include File 

Number SR–CBOE–2011–019 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–CBOE–2011–019. 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 website (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 website 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–CBOE– 

2011–019 and should be submitted on 

or before April 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–5761 Filed 3–11–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64052; File No. SR–C2– 

2011–010] 

Self-Regulatory Organizations; C2 

Options Exchange, Incorporated: 

Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change To Establish a Revenue 

Sharing Program With Correlix, Inc. 

March 8, 2011. 

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 March 1, 

2011, C2 Options Exchange, 

Incorporated (‘‘C2’’ 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 C2. The Commission 

is publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

C2 Options Exchange, Incorporated 

(‘‘C2’’ or ‘‘Exchange’’) proposes to 

establish a revenue sharing program 

with Correlix, Inc. 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, C2 

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. C2 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 is filing a proposed rule 

change to establish a revenue sharing 

program with Correlix. The Exchange 

has entered into an agreement with 

Correlix to provide to users of the 

Exchange real-time analytical tools to 

measure the latency of orders to and 

from its systems. Under the agreement, 

the Exchange will receive 30% of the 

total monthly subscription fees received 

by Correlix from parties who have 

contracted directly with Correlix to use 

their RaceTeam latency measurement 

service for the Exchange’s systems. The 

Exchange will not bill or contract with 

any Correlix RaceTeam customer 

directly. 

Pricing for the Correlix RaceTeam 

product for the Exchange varies 

depending on the number of unique 

acronyms and logons selected by the 

customer for monitoring by Correlix. For 

the Exchange, the fee will be an initial 

$1,500 monthly base fee for the first 

unique acronym monitored. For each 

additional unique acronym sought to be 

monitored, an additional monthly 

charge of $1,500 will be assessed. The 

monthly price for each unique acronym 

includes the monitoring of up to 25 

Exchange logons associated with that 

particular acronym. Customers that 

wish to exceed 25 logons per-acronym 

for monitoring can purchase additional 

25 logon blocks for an additional fee of 

$750 per month per acronym. 

Under the program, Correlix will see 

an individualized unique Exchangegenerated identifier that will allow 

Correlix RaceTeam to determine round 

trip order time,3 from the time the order 

reaches the Exchange extranet, through 

the Exchange matching engine, and back 

out of the Exchange extranet. The 

RaceTeam product offering does not 

measure latency outside of the Exchange 

extranet. The unique identifier serves as 

a technological information barrier so 

that the RaceTeam data collector will 

only be able to view data for Correlix 

RaceTeam subscriber firms related to 

latency. Correlix will not see 

subscriber’s individual order detail such 

as security, price or size. Individual 

RaceTeam subscribers’ logins will 

restrict access to only their own latency 

data. Correlix will see no specific 

information regarding the trading 

activity of non-subscribers. The 

Exchange believes that the above 

arrangement will provide users of its 

systems greater transparency into the 

processing of their trading activity and 

allow them to make more efficient 

trading decisions. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

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