Federal Register / Vol. 76, No. 70 / Tuesday, April 12, 2011 / Notices 20411 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(2). 

5See Securities Exchange Act Release No. 63470 

(December 8, 2010), 75 FR 78284 (December 15, 

2010) (SR–CBOE–2010–108). 

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

7 15 U.S.C. 78f(b)(4). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64212; File No. SR–CBOE– 

2011–033] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to CBOE’s 

Marketing Fee Program 

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 and II 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated this proposal as one 

establishing or changing a due, fee, or 

other charge imposed by CBOE under 

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

Rule 19b–4(f)(2) 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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Chicago Board Options Exchange, 

Incorporated (‘‘CBOE’’ or ‘‘Exchange’’) 

proposes to amend its Fees Schedule 

and specifically make certain changes to 

its Marketing Fee Program. 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, the Proposed Rule 

Change 

1. Purpose 

CBOE proposes to amend its 

Marketing Fee Program to extend for an 

additional three months a pilot program 

it implemented on December 1, 2010, 

relating to the assessment of the 

marketing fee in the SPY option class.5

Specifically, CBOE previously 

determined not to assess the marketing 

fee on electronic transactions in SPY 

options, except that it would continue 

to assess the marketing fee on electronic 

transactions resulting from its 

Automated Improvement Mechanism 

(‘‘AIM’’) pursuant to CBOE Rule 6.74A 

and transactions in open outcry. This 

pilot program is scheduled to terminate 

on March 31, 2011, and CBOE now 

proposes to extend it until June 30, 

2011. 

As CBOE stated in its rule filing 

establishing this three month pilot 

program, this proposed change is 

intended to attract more customer 

volume to the Exchange in this option 

class and to allow CBOE market-makers 

to better compete for order flow. CBOE 

noted that the SPY option class is 

unique in the manner in which it trades 

and is one of the most active option 

classes. CBOE also noted that DPMs and 

Preferred Market-Makes [sic] can utilize 

the marketing fee funds to attract orders 

from payment accepting firms that are 

executed in AIM and in open outcry. 

Finally, CBOE noted that it believes that 

the marketing fee funds received by 

payment accepting firms may be used to 

offset transaction and other costs related 

to the execution of an order in AIM and 

in open outcry, including in the SPY 

option class. 

For the reasons noted above, CBOE 

believes that it would make sense to 

extend the pilot program until June 30, 

2011. CBOE believes that it is beneficial 

to continue to assess the fee on the 

limited bases as proposed and will 

continue to enable CBOE to compete for 

order flow in the SPY option class. 

However, because the SPY option class 

is unique in the manner in which it 

trades and is one of the most active 

option classes, CBOE would like to 

continue to evaluate for an additional 

three months the effect of not assessing 

the fee on all electronic transactions in 

the SPY option class, except for 

transactions resulting from AIM and in 

open outcry. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),6 in general, and furthers the 

objectives of Section 6(b)(4) 7 of the Act, 

in particular, in that it is designed to 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among Trading Permit Holders in that it 

is intended to attract more customer 

volume on the Exchange in SPY 

options. The SPY option class is one of 

the most active and liquid classes and 

trades with a significant electronic 

trading volume. Because of its current 

trading profile, CBOE believes it might 

be better able to attract electronic 

liquidity by not assessing the marketing 

fee on electronic SPY transactions and 

therefore proposes to extend the current 

waiver. However, CBOE believes that 

continuing to collect the marketing fee 

on open outcry transactions, as well as 

electronic orders submitted to AIM for 

price improvement, from market makers 

that trade with customer orders from 

payment accepting firms would 

continue to attract liquidity in SPY to 

the floor and AIM mechanism, 

respectively. Accordingly, CBOE 

believes continuing the waiver is 

equitable because it reflects the trading 

profile of SPY and is designed and 

intended to attract additional order flow 

in SPY to the Exchange, which would 

benefit all trading permit holders. 

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 [sic] 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 

Because the foregoing proposed rule 

change establishes or changes a due, fee, 

or other charge imposed by the 

Exchange, it has become effective 

pursuant to Section 19(b)(3)(A) of the 


srobinson on DSKHWCL6B1PROD with NOTICES
20412 Federal Register / Vol. 76, No. 70 / Tuesday, April 12, 2011 / Notices 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(2). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Exchange’s two modes of order interaction 

are described in NSX Rule 11.13(b). 

4 ‘‘Zero Display Orders’’ means ‘‘Zero Display 

Reserve Orders’’ as specified in NSX Rule 

11.11(c)(2)(A). 

Act 8 and subparagraph (f)(2) of Rule 

19b–4 9 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 

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–2011–033 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–2011–033. 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 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 

Number SR–CBOE–2011–033 and 

should be submitted on or before May 

3, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–8631 Filed 4–11–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64208; File No. SR–NSX– 

2011–02] 

Self-Regulatory Organizations; 

National Stock Exchange, Inc.; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change To Amend 

the NSX Fee and Rebate Schedule and 

NSX Rule 16.4 

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 29, 

2011, National Stock Exchange, Inc. 

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 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 National Stock Exchange, Inc. 

(‘‘NSX® ’’ or the ‘‘Exchange’’) is 

proposing a rule change, operative at 

commencement of trading on April 1, 

2011, which proposes to amend the 

NSX Fee and Rebate Schedule (the ‘‘Fee 

Schedule’’) to adjust certain liquidity 

taking rebates and fees in the Automatic 

Execution Mode of order interaction, 

eliminate the Exchange’s market data 

rebate in the Order Delivery Mode of 

order interaction and establish an 

exchange regulatory fee. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.nsx.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 

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 

With this rule change, the Exchange is 

proposing to modify the Fee Schedule 

and related text of Rule 16 in four 

respects. First, the proposed rule change 

would increase the highest rebate, and 

adjust the tier thresholds, for liquidity 

adding displayed orders in the 

Automatic Execution Mode of order 

interaction (‘‘AutoEx’’) 3 priced at least 

one dollar. Certain conforming changes 

are also proposed for rebates for 

liquidity adding Zero Display Orders 4

in AutoEx priced at least one dollar. 

Second, the proposed rule change 

would eliminate the $0.0028 taker fee 

on orders that take liquidity in AutoEx 

for securities one dollar and above. 

Third, the proposed rule change would 

eliminate the market data revenue 

rebate currently available in the Order 

Delivery Mode of order interaction 

(‘‘Order Delivery’’). Finally, the 

proposed rule change would establish a 

monthly exchange regulatory fee. Each 

of the proposed changes is further 

addressed below. 

AutoEx Liquidity Adding Rebate for 

Securities Priced at Least One Dollar 

Currently, for displayed orders in 

securities priced one dollar and above 

that provide liquidity in AutoEx, the 

Fee Schedule provides a (‘‘Tier 1’’) 

rebate of $0.0026 per share if an ETP 

Holder’s liquidity adding average daily 

volume (as such term is defined in 

Endnote 3 of the Fee Schedule, 

‘‘Liquidity Adding ADV’’) is less than 20 

basis points of Total Consolidated 

Average Daily Volume (as defined in 

Endnote 13 of the Fee Schedule, 


srobinson on DSKHWCL6B1PROD with NOTICES