20750 Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 

among other things, adoption of NASD Rule 2370 

as FINRA Rule 3240). 

7See Securities Exchange Release No. 59432 

(February 23, 2009), 74 FR 9121 (March 2, 

2009)(SR–FINRA–2009–005)(notice of filing and 

immediate effectiveness). 

8See Securities Exchange Release No. 56726 

(October 31, 2007), 72 FR 62719 (November 6, 

2007)(SR–NYSE–2007–96)(notice of filing and 

immediate effectiveness). 

9 15 U.S.C. 78f. 

10 15 U.S.C. 78f(b)(5). 

11 15 U.S.C. 78s(b)(3)(A). 

12 17 CFR 240.19b–4 (f)(6). 

13 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

changes, NASD Rule 2370 regarding 

borrowing from or lending to customers 

into the FINRA consolidated rulebook 

as FINRA Rule 3240, and added record 

retention requirements. FINRA Rule 

3240, like former NASD Rules 2370, 

focuses in general on the 

appropriateness of particular lending 

arrangements between FINRA member 

broker-dealers and their registered 

persons and customers (to the extent 

permitted by the member) and the 

potential for conflicts of interests 

between both the registered person and 

his or her customer and the registered 

person and the member with which he 

or she is associated. 

Additionally, in SR–FINRA–2009– 

005,7 FINRA renumbered crossreferences in its rules from NYSE Rule 

80A to NYSE Rule 132B on the basis of 

a New York Stock Exchange (‘‘NYSE’’ or 

NYSE Euronext’’) rule proposal.8 In that 

proposal, NYSE rescinded its Rule 80A 

regarding index arbitration [sic] 

restrictions and repositioned the 

definitions of ‘‘index arbitrage’’ and 

‘‘program trading’’ into NYSE Rule 132B. 

Because BX Rule 6951 refers in its 

definitions of index arbitrage and 

program trading to Rule 80A, BX is, by 

this filing, updating the references in its 

Rule 6951 from NYSE Rule 80A to 132B. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the provisions of Section 6 of the Act,9

in general, and with Sections 6(b)(5) of 

the Act,10 in particular, in that the 

proposal is designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, 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. The 

proposed changes will conform BX 

Rules 2360, 2361, 2370, and 6951 to 

recent changes made to several 

corresponding FINRA rules, to promote 

application of consistent regulatory 

standards. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will result in 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 11 and Rule 19b– 

4 (f)(6) thereunder.12

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 rulecomments@sec.gov. Please include File 

Number SR–BX–2011–021 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–BX–2011–021. 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 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 offices 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 

Number SR–BX–2011–021, and should 

be submitted on or before May 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–8911 Filed 4–12–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64253; File No. SR–EDGX– 

2011–09] 

Self-Regulatory Organizations; EDGX 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to Amendments 

to the EDGX Exchange, Inc. Fee 

Schedule 

April 7, 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 April 6, 

2011, the EDGX Exchange, Inc. (the 

‘‘Exchange’’ or the ‘‘EDGX’’) filed with 

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Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 20751 

3A Member is any registered broker or dealer, or 

any person associated with a registered broker or 

dealer, that has been admitted to membership in the 

Exchange. 

4 15 U.S.C. 78f. 

5 15 U.S.C. 78f(b)(4). 

6See SR–EDGX–2011–08 (April 1, 2011). 7The Exchange notes that ROUD/ROUE routing 

strategies route to the identical number of low cost 

destinations. 8See SR–EDGX–2011–08 (April 1, 2011). See 

Rule 11.9(b)(3)(c)(v). 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 19b–4(f)(2). 

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 selfregulatory organization. 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 amend its 

fees and rebates applicable to Members 3

of the Exchange pursuant to EDGX Rule 

15.1(a) and (c). All of the changes 

described herein are applicable to EDGX 

Members. The text of the proposed rule 

change is available on the Exchange’s 

Internet Web site at http:// 

www.directedge.com. 

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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization 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 reduce the 

rate on Flag T from $0.0020 per share 

to $0.0012 per share for routing using 

the ROUD/ROUE routing strategies, as 

defined in Rules 11.9(b)(3)(b) and 

11.9(b)(3)(c)(i). 

EDGX Exchange proposes to 

implement this amendment to the 

Exchange fee schedule on April 6, 2011. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the objectives of Section 6 of the 

Exchange Act,4 in general, and furthers 

the objectives of Section 6(b)(4),5 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. 

The Exchange believes that the 

proposed reduced rate for Flag T 

(routing using ROUD/ROUE routing 

strategies) of $0.0012 per share is an 

equitable allocation of reasonable dues, 

fees, and other charges. Lower fees are 

directly correlated with a higher number 

of intermediate low cost destinations as 

the more intermediate low cost 

destinations that there are, there is a 

greater potential for an execution at a 

lower cost destination before reaching a 

higher cost destination. For example, 

the ROUQ routing strategy, as defined in 

Rule 11.9(b)(3)(c)(iv),6 routes to the 

lowest number of low cost destinations 

compared to the ROUD/ROUE 7 and 

ROUZ 8 routing strategies. As a result, 

the Exchange charges a higher fee for 

such strategy of $0.0020 per share (flag 

Q). The ROUD/ROUE routing strategies 

route to a medium number of low cost 

destinations and the ROUZ routing 

strategy routes to the highest number of 

low costs destinations amongst these 

routing strategies. As a result, the 

Exchange will assess a proposed fee of 

$0.0012 per share for the ROUD/ROUE 

routing strategies and assesses the 

lowest fee for the ROUZ routing strategy 

of $0.0010 per share. The more low cost 

destinations that an order routes to 

allows the Exchange to pass on the 

savings it receives from such 

destinations to its members in lower 

fees. Therefore, it is equitable that 

ROUQ has the highest fee of $0.0020 per 

share, while ROUD/ROUE has an 

intermediate fee of $0.0012 per share, 

and ROUZ has the lowest fee of the 

three strategies of $0.0010 per share. 

The Exchange also notes that a 

difference between ROUQ and ROUZ 

routing strategies is that the additional 

routing destinations in the ROUZ 

routing strategy are intermediate 

between the routing destinations in 

ROUQ. This also accounts for the 

differences in fees. Therefore, for each 

additional intermediate low cost 

destination that an order routes to, the 

prices of the strategies mentioned above 

(ROUQ, ROUD/ROUE, ROUZ) decrease 

accordingly. 

The Exchange believes that the rate is 

reasonable when compared to other 

market centers using similar routing 

strategies. The comparable routing 

strategy to the ROUD/ROUE routing 

strategies is Parallel D or Parallel 2D 

with the DRT (Dark routing technique) 

option on BATS BZX Exchange 

(‘‘BATS’’). BATS charges $0.0020 per 

share for its DRT option. The Exchange 

believes that the proposed rebate is nondiscriminatory in that it applies 

uniformly to all Members. 

The Exchange notes that it 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 the 

Exchange. The Exchange believes that 

the proposed rates are equitable in that 

they apply uniformly to all Members. 

The Exchange believes the fees and 

credits remain competitive with those 

charged by other venues and therefore 

continue to be reasonable and equitably 

allocated to Members. 

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 9 and Rule 19b–4(f)(2) 10

thereunder. At any time within 60 days 

of the filing of such 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. 

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20752 Federal Register / Vol. 76, No. 71 / Wednesday, April 13, 2011 / Notices 

11The text of the proposed rule change is 

available on Exchange’s Web site at http:// 

www.directedge.com, on the Commission’s Web site 

at http://www.sec.gov, at EDGX, and at the 

Commission’s Public Reference Room. 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Exchange Act Release No. 53522 (March 20, 

2006), 71 FR 14975 (March 24, 2006) (SR–ISE– 

2006–09). 

4 Id. 

5See Exchange Act Release No. 56721 (October 

30, 2007), 72 FR 62502 (November 5, 2007) (SR– 

ISE–2007–91). 

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–EDGX–2011–09 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–EDGX–2011–09. 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,11 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 the 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 

available publicly. All submissions 

should refer to File Number SR–EDGX– 

2011–09 and should be submitted on or 

before May 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–8910 Filed 4–12–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64269; File No. SR–ISE– 

2011–21] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to API Fees 

April 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 April 6, 

2011, the International Securities 

Exchange, LLC (the ‘‘Exchange’’ or the 

‘‘ISE’’) filed with the Securities and 

Exchange Commission the proposed 

rule change, as described in Items I, II, 

and III below, which items have been 

prepared by the self-regulatory 

organization. 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 ISE is proposing to amend its 

Schedule of Fees regarding the 

Exchange’s API or login fees. The text of 

the proposed rule change is available on 

the Exchange’s Web site (http:// 

www.ise.com), at the principal office of 

the Exchange, 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 

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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization 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 ISE is proposing to amend its 

Schedule of Fees regarding the 

Exchange’s API or login fees. ISE 

currently charges its members a fee for 

each login that a Member utilizes for 

quoting or order entry, with a lesser 

charge for logins used for the limited 

purpose of ‘‘listening’’ to broadcast 

messages.3 The Exchange currently has 

the following categories of authorized 

logins: (1) Quoting, order entry and 

listening (allowing the user to enter 

quotes, orders, and perform all other 

miscellaneous functions, such as setting 

parameters and pulling quotes); (2) 

order entry and listening (allowing the 

user to enter orders and perform all 

other miscellaneous functions, such as 

setting parameters and pulling quotes 

(but not quoting)); and (3) listening 

(allowing the user only to query the 

system and to respond to broadcast 

messages).4 The Exchange notes that 

quoting, order entry and listening are 

functionalities available only to 

Exchange market makers, i.e., Primary 

Market Makers and Competitive Market 

Makers, while order entry and listening 

are functionalities available only to nonmarket makers, i.e., Electronic Access 

Members. 

ISE market makers currently receive 

an allocation of 1,300,000 quotes per 

day per user.5 If a market maker submits 

more quotes than those allocated, i.e., 

1,300,000 quotes per day per user as 

measured on average in a single month, 

the market maker is charged for 

additional users depending upon the 

number of quotes submitted. Each 

month, the total number of quotes 

submitted by a market maker across all 

bins (i.e., group of options to which the 

market maker is appointed), is divided 

by the number of trading days, resulting 

in the average quotes per day. This 

number is then divided by 1,300,000 

and rounded up to the nearest whole 

number, resulting in an implied number 

of users based on quotes. Market makers 

are invoiced on a monthly basis for the 

greater of (a) the greatest number of 

users that logged into the system, or (b) 

the number of implied users based on 

quotes. 

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