3184 Federal Register / Vol. 76, No. 12 / Wednesday, January 19, 2011 / Notices 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 3See Securities Exchange Act Release No. 62386 

(June 25, 2010), 75 FR 38566 (July 2, 2010) (SR– 

CBOE–2010–073) [sic]. 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–FINRA–2010–068. 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 

FINRA. 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 publicly available. All 

submissions should refer to File 

Number SR–FINRA–2010–068 and 

should be submitted on or before 

February 9, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–949 Filed 1–18–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63706; File No. SR–CBOE– 

2011–004] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Its Fees 

Schedule and Circular Regarding 

Trading Permit Holder Application and 

Other Related Fees 

January 12, 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 January 3, 

2011, the 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 CBOE. 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 circular regarding Trading Permit 

Holder application and other related 

fees (‘‘Trading Permit Fee Circular’’).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’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, 

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 Rule 2.20 grants the Exchange 

the authority to, from time to time, fix 

the fees and charges payable by Trading 

Permit Holders. CBOE is proposing to 

amend its Fees Schedule and Trading 

Permit Fee Circular to (i) Amend the 

monthly fee for Market-Maker Trading 

Permits and establish a sliding scale for 

discounted Market-Maker Trading 

Permit Fees (subject to certain 

conditions); (ii) establish a VIX Tier 

Appointment; (iii) amend the monthly 

fee for Floor Broker Trading Permits and 

add an additional fee for Floor Brokers 

that conduct a certain level of activity 

in VIX; (iv) amend the monthly fee for 

Electronic Access Permits; (v) amend 

the monthly fees for bandwidth packets; 

(vi) increase the Inactive Nominee 

Status fee; (vii) increase the Fingerprint 

Processing Fee; and (viii) update the 

Fees Schedule to remove outdated 

language. 

CBOE Rule 3.1 provides, among other 

things, that the Exchange may issue 

different types of Trading Permits and 

determine the fees for those Trading 

Permits. Specifically, under Rule 

3.1(a)(iv), the Exchange may issue 

different types of Trading Permits that 

allow holders to trade one or more 

products authorized for trading on the 

Exchange and to act in one or more 

trading functions authorized by CBOE 

Rules. The Exchange currently has four 

types of Trading Permits: (i) MarketMaker Trading Permit; (ii) Floor Broker 

Trading Permit; (iii) Electronic Access 

Permit; and (iv) CBSX Trading Permit. 

Rule 3.1(a)(v) provides, in relevant part, 

that Trading Permits will be subject to 

such fees and charges as are established 

by the Exchange from time to time 

pursuant to CBOE Rule 2.20 and the 

Exchange Fees Schedule. 

In June 2010, and immediately 

following demutualization, CBOE 

amended its Fees Schedule to establish 

Trading Permit, tier appointment and 

bandwidth packet fees.3 The Fees 

Schedule established a monthly fee of 

$7,500 for a Market-Maker Trading 

Permit. At the time the Market-Maker 

Trading Permits were established, CBOE 

determined to discount the fees by 20% 

for the remainder of 2010. Thus, 

between July 2010 and December 2010, 

CBOE assessed a fee of $6,000 per 

month for a Market-Maker Trading 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 76, No. 12 / Wednesday, January 19, 2011 / Notices 3185 

4A Trading Permit Holder may pay more than the 

tier minimum for monthly access fees if the Trading 

Permit Holder has additional Trading Permits that 

are not eligible for the sliding scale. 5 15 U.S.C. 78f(b)(4). 

Permit. CBOE is proposing to decrease 

the standard $7,500 monthly fee for a 

Market-Maker Trading Permit to $6,000, 

which is the same as the current level 

of this fee. 

CBOE is also proposing to establish 

the following sliding scale for MarketMaker Trading Permits subject to the 

certain conditions: 

From To 

Amount 

per month 

per permit 

($) 

1 permit ..................................................... 10 permits ................................................. 6,000 

Tier 1 ......................................................... 11 permits ................................................. 20 permits ................................................. 4,800 

Tier 2 ......................................................... 21 or more permits ................................... ................................................................... 3,000 

The sliding scale will be available for 

all Market-Maker Trading Permits, held 

by affiliated Trading Permit Holders and 

TPH organizations, that are used for 

appointments in any options classes 

other than SPX, VIX, OEX and XEO. 

Any Market-Maker Trading Permits 

used for these four classes, whether in 

whole or in part, are excluded from this 

sliding scale and will be priced at 

$6,000 per month. To qualify for the 

rates set forth in Tiers 1 and 2 in the 

sliding scale, the applicable Trading 

Permit Holder(s) and/or TPH 

organization(s) must commit to a 

specific tier that includes a minimum 

number of eligible Market-Maker 

Trading Permits for each calendar year. 

To participate in the program, a MarketMaker Trading Permit Holder must 

notify the Registration Services 

Department by January 25th of each year 

(or the preceding business day if the 

25th is not a business day) of the tier of 

eligible Market-Maker Trading Permits 

committed to by the Market-Maker 

Trading Permit Holder for that calendar 

year. Market-Makers are not obligated to 

commit to either tier. However, the 

discounts will apply only to those that 

do commit to Tier 1 or Tier 2 for the 

calendar year (or remainder of the 

calendar year as described below). 

Trading Permit Holders that are not 

eligible for and/or that do not commit to 

Tier 1 or Tier 2 will continue to pay the 

standard rate for each Market-Maker 

Trading Permit, regardless of the total 

number of Market-Maker Trading 

Permits used. 

If a Trading Permit Holder chooses to 

commit to either Tier 1 or Tier 2, that 

Trading Permit Holder will be assessed 

fees for at least the minimum number of 

permits in the commitment tier for the 

remainder of the calendar year.4 Even if 

a Trading Permit Holder no longer 

maintains the minimum number of 

eligible Trading Permits in the 

committed tier, that Trading Permit 

Holder is still responsible for the 

minimum payment for that commitment 

tier for the remainder of the calendar 

year. For example, a Trading Permit 

Holder that commits to eleven eligible 

permits per month will be subject to a 

minimum monthly access fee of $64,800 

(10 × $6,000 plus $4,800 = $64,800) for 

that calendar year. Any additional 

permits will increase the fee by the 

applicable amount (i.e., if the subject 

Trading Permit Holder also maintains 

an additional Trading Permit that is 

associated with an appointment in OEX, 

the monthly access fee will be $70,800). 

Trading Permit Holders may also 

choose to commit to a higher tier of the 

sliding scale for the remainder of a 

calendar year, during a commitment 

year, if the Trading Permit Holder 

obtains enough eligible Market-Maker 

Trading Permits and provides written 

notification to the Registration Services 

Department by the 25th day of the 

month preceding the month in which 

the higher tier will be effective (or the 

preceding business day if the 25th is not 

a business day). For example, a Trading 

Permit Holder may provide written 

notice to commit to Tier 1 effective July 

1 for the remainder of the calendar year 

as long as the Trading Permit Holder 

obtains enough eligible Trading Permits 

and provides written notice by June 

25th that the Trading Permit Holder 

would like to participate in the sliding 

scale starting in July for the remainder 

of the calendar year. Even if that 

Trading Permit Holder subsequently 

falls below the minimum number of 

eligible Market-Maker Trading Permits 

(in the committed calendar year), for the 

committed tier, the Trading Permit 

Holder will remain responsible for 

paying at least the tier minimum for the 

remainder of the calendar year. 

Trading Permit Holders will be 

responsible to pay for the minimum 

amount of eligible Market-Maker 

Trading Permits (based on the 

commitment tier) for the calendar year 

on a monthly basis unless the Trading 

Permit Holder entirely terminates as a 

Trading Permit Holder during the year. 

If a Trading Permit Holder combines, 

merges, or is acquired during the course 

of the calendar year, the surviving 

Trading Permit Holder will maintain 

responsibility for the committed number 

of eligible Market-Maker Trading 

Permits. 

Section 6(b)(4) of the Securities 

Exchange Act of 1934 5 (the ‘‘Act’’) 

requires that: ‘‘the rules of the exchange 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among its members and issuers and 

other persons using its facilities.’’ The 

proposed sliding scale is available to all 

Trading Permit Holders that maintain 

eligible Market-Maker Trading Permits. 

In essence, CBOE is offering a 

discounted fee in return for a 

commitment for a designated period of 

time. Trading Permit Holders are not 

precluded from providing notice that 

they wish to participate in the sliding 

scale program throughout a calendar 

year as long as such notice is provided 

by the 25th day of the preceding month 

of effectiveness. CBOE is proposing to 

offer this sliding scale as a benefit to 

those Trading Permit Holders that 

commit in advance. There is no 

obligation to commit to either Tier 1 or 

Tier 2 of the sliding scale. Since Tier 2 

requires a commitment of twenty-one or 

greater permits, CBOE believes that 

Market-Makers quoting all multiply 

listed classes may consider committing 

in advance to Tier 2. It requires 

approximately thirty Trading Permits 

for a Trading Permit Holder to obtain 

Market-Maker appointments in all 

multiply-listed classes at the Exchange. 

CBOE Rule 8.3(e) provides that the 

Exchange may establish one or more 

types of tier appointments. In 

accordance with CBOE Rule 8.3(e), a tier 

appointment is an appointment to trade 

one or more options classes that must be 

held by a Market-Maker to be eligible to 

act as a Market-Maker in the options 

class or options classes subject to that 

appointment. CBOE currently maintains 

a tier appointment for Market-Maker 

mstockstill on DSKH9S0YB1PROD with NOTICES

3186 Federal Register / Vol. 76, No. 12 / Wednesday, January 19, 2011 / Notices 

6See Securities Exchange Act Release No. 63186 

(October 27, 2010), 75 FR 67417 (November 2, 2010) 

(SR–CBOE–2010–095). 

7See Securities Exchange Act Release No. 62704 

(August 12, 2010), 75 FR 51132 (August 18, 2010) 

(SR–CBOE–2010–073). 8 Id. 

Trading Permit Holders trading in SPX. 

The current Fees Schedule provides that 

the SPX Tier Appointment fee will be 

assessed to any Market-Maker Trading 

Permit Holder that either (a) has an SPX 

Tier Appointment at any time during a 

calendar month; or (b) conducts any 

open outcry transactions in SPX at any 

time during a calendar month. CBOE is 

proposing to delete this language from 

the section entitled Assessment of 

Trading Permit and Bandwidth Packet 

Fees and move this language to Section 

10(A)(ii) that describes the SPX Tier 

Appointment. In addition, in 

conjunction with a recent rule filing 

enabling the trading of certain series of 

options on the Hybrid trading platform 

even though that class generally trades 

on Hybrid 3.0,6 CBOE is proposing to 

clarify the description of the SPX Tier 

Appointment in Section 10(A)(2) [sic] to 

clarify that the SPX Tier Appointment 

fee will also be assessed to a MarketMaker Trading Permit Holder that 

submits open outcry transactions in SPX 

or electronic or open outcry transactions 

in SPX Weeklys. SPX options trade on 

Hybrid 3.0 but CBOE has recently listed 

series of SPX Weeklys that are currently 

trading on Hybrid. 

CBOE is now proposing to also 

establish a VIX Tier Appointment. 

Effective January 3, 2010, a MarketMaker Trading Permit Holder must 

obtain a VIX Tier Appointment to act as 

a Market-Maker in VIX. Further, 

consistent with the provisions of Rule 

8.3(e), each VIX Tier Appointment may 

only be used with one designated 

Market-Maker Trading Permit. The 

Exchange is proposing that the initial 

fee for a VIX Tier Appointment be set 

at $1,000 per month. 

VIX Tier Appointment fees are nonrefundable and will be assessed through 

the integrated billing system during the 

first week of the following month. The 

VIX Tier Appointment fee will be 

assessed to any Market-Maker Trading 

Permit Holder, registered with the 

Exchange to conduct business on the 

Exchange as a Market-Maker, that either 

(a) has a VIX Tier Appointment at any 

time during a calendar month; or (b) 

conducts any transactions in VIX at any 

time during a calendar month. VIX Tier 

Appointments will be renewed 

automatically for the next month unless 

the Trading Permit Holder submits by 

the 25th day of the prior month (or the 

preceding business day if the 25th is not 

a business day) a written notification to 

cancel the VIX Tier Appointment 

effective at or prior to the end of the 

applicable month. 

The Fees Schedule previously 

established a monthly fee of $2,000 for 

an Electronic Access Permit. At the time 

the Electronic Access Permits were 

implemented, CBOE determined to 

discount the fees by 20% for the 

remainder of 2010. Thus, between July 

2010 and December 2010, CBOE 

assessed a fee of $1,600 per month for 

an Electronic Access Permit. CBOE is 

proposing to decrease the $2,000 

monthly fee for an Electronic Access 

Permit to $1,600, which is the same as 

the current level of this fee. 

In August 2010, CBOE amended its 

Fees Schedule and Trading Permit Fee 

Circular to establish a fee scale for the 

purchase of Order Entry Bandwidth 

Packets under which the cost of an 

Order Entry Bandwidth Packet would 

decline at certain break points as 

additional Order Entry Bandwidth 

Packets are purchased.7 Specifically, the 

first through fifth Order Entry 

Bandwidth Packets obtained by a 

Trading Permit Holder cost $2,000 per 

packet per month, the sixth through 

eighth Order Entry Bandwidth Packets 

obtained by that Trading Permit Holder 

would cost $1,000 per packet per 

month, the ninth through thirteenth 

Order Entry Bandwidth Packets 

obtained by that Trading Permit Holder 

would cost $500 per packet per month, 

and the fourteenth and each additional 

Order Entry Bandwidth Packet obtained 

by that Trading Permit Holder would 

cost $250 per packet per month. CBOE 

also discounted these fees by 20% for 

the remainder of 2010. CBOE is now 

proposing to decrease the monthly fee 

scale for Order Entry Bandwidth Packets 

such that the first through fifth Order 

Entry Bandwidth Packets obtained by a 

Trading Permit Holder would cost 

$1,600 per packet per month, the sixth 

through eighth Order Entry Bandwidth 

Packets obtained by that Trading Permit 

Holder would cost $800 per packet per 

month, the ninth through thirteenth 

Order Entry Bandwidth Packets 

obtained by that Trading Permit Holder 

would cost $400 per packet per month, 

and the fourteenth and each additional 

Order Entry Bandwidth Packet obtained 

by that Trading Permit Holder would 

cost $200 per packet per month (which 

is the same as the current level of these 

fees). 

CBOE also amended its Fees Schedule 

in August 2010 to allow Trading Permit 

Holders to obtain and assign to a 

particular Sponsored User of the 

Trading Permit Holder one or more 

Order Entry Bandwidth Packets.8 In that 

event, the fees for the assigned 

bandwidth packet(s) would be assessed 

to the Trading Permit Holder and the 

bandwidth packet(s) could be utilized 

solely by the Sponsored User (and not 

by the Trading Permit Holder or any 

other Sponsored User). 

Fees for Order Entry Bandwidth 

Packets assigned to a particular 

Sponsored User are also subject to a fee 

scale, similar to the fee scale in place for 

the Order Entry Bandwidth Packet 

assigned to a particular Trading Permit 

Holder. Specifically, the full fee scale 

for Order Entry Bandwidth Packets 

assigned by a Trading Permit Holder to 

a Sponsored User provides that the first 

through sixth Order Entry Bandwidth 

Packets assigned to the Sponsored User 

would cost $2,000 per packet per 

month, the seventh through ninth Order 

Entry Bandwidth Packets assigned to 

that Sponsored User would cost $1,000 

per packet per month, the tenth through 

fourteenth Order Entry Bandwidth 

Packets assigned to that Sponsored User 

would cost $500 per packet per month, 

and the fifteenth and each additional 

Order Entry Bandwidth Packet assigned 

to that Sponsored User would cost $250 

per packet per month. CBOE also 

discounted these fees by 20% for the 

remainder of 2010. CBOE is now 

proposing to decrease the monthly fee 

scale for Order Entry Bandwidth Packets 

assigned by a Trading Permit Holder to 

a particular Sponsored User such that 

the first through sixth Order Entry 

Bandwidth Packets assigned to the 

Sponsored User would cost $1,600 per 

packet per month, the seventh through 

ninth Order Entry Bandwidth Packets 

assigned to that Sponsored User would 

cost $800 per packet per month, the 

tenth through fourteenth Order Entry 

Bandwidth Packets assigned to that 

Sponsored User would cost $400 per 

packet per month, and the fifteenth and 

each additional Order Entry Bandwidth 

Packet assigned to that Sponsored User 

would cost $200 per packet per month 

(which is the same as the current level 

of these fees). 

CBOE is also proposing to make two 

technical changes to Section 10 of the 

CBOE Fees Schedule. First, CBOE is 

proposing to modify the numbering of 

the section setting forth the Trading 

Permit and tier appointment fees and 

the accompanying descriptions to reflect 

the addition of the VIX Tier 

Appointment. In addition, CBOE is 

proposing to remove references 

throughout Section 10 of the Fees 

Schedule to Trading Permit, tier 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 76, No. 12 / Wednesday, January 19, 2011 / Notices 3187 

9See Securities Exchange Act Release No. 57191 

(January 24, 2008), 73 FR 5611 (January 30, 2008) 

(SR–CBOE–2007–150). 

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

11 15 U.S.C. 78f(b)(4). 

12 15 U.S.C. 78s(b)(3)(A). 

13 17 CFR 240.19b–4(f)(2). 

appointment and bandwidth packet fees 

regarding the assessment of these fees in 

2010 as this language is outdated and no 

longer necessary. 

CBOE is also proposing to make two 

changes to Section 11 of the CBOE Fees 

Schedule. First, CBOE is proposing to 

increase the Inactive Nominee Status fee 

from $750 to $900. This fee is payable 

quarterly by a TPH organization for each 

inactive nominee status that the TPH 

organization wishes to maintain. (e.g., a 

TPH organization firm desiring the 

ability to have three parking spaces 

within which to designate inactive 

nominees would pay this fee at the 

beginning of each quarter for each of the 

three parking spaces). In addition, CBOE 

is proposing to increase the Fingerprint 

Processing Fee from $50 to $60. This fee 

is assessed for employees of Trading 

Permit Holders and any other individual 

requesting the Exchange to process a 

fingerprint, electronically or otherwise, 

excluding fingerprint requirements for 

Individual Applicants, individuals 

applying for Renewal/Change of Status, 

and Associated Persons. CBOE is 

proposing to increase these fees to 

account for an increase in resources 

required to process inactive nominee 

information, fingerprints, and related 

requests. The Inactive Nominee Status 

Fee and the Fingerprint Processing Fee 

have not been increased in three years.9

In addition to the proposed changes to 

the Fees Schedule described above, 

CBOE is proposing to revise its 

regulatory circular that sets forth the 

existing Trading Permit Holder 

application and other related fees. The 

Exchange proposes to revise this 

circular to incorporate the changes to 

Sections 10 and 11 of the CBOE Fees 

Schedule that are described above, as 

well as to clarify the description of the 

Fingerprint Processing Fee to provide 

that only those associated persons that 

are subject to the Associated Person 

Application [sic] Fee are not subject to 

the Fingerprint Processing Fee. The 

proposed changes to the circular are 

included as Exhibit 2 to the Form 

19b–4. 

2. Statutory Basis 

The proposed rule change will treat 

similarly situated Trading Permit 

Holders in the same manner. 

Specifically, CBOE shall assess the same 

base Trading Permit, tier appointment 

and bandwidth packet fees to all 

Trading Permit Holders based on the 

type of tier appointment requested and 

type and number of Trading Permit(s) 

and bandwidth packet(s) requested. All 

Trading Permit Holders may elect to 

receive a discounted price if the Trading 

Permit Holder commits in advance to a 

minimum number of eligible MarketMaker Trading Permits for a calendar 

year. Trading Permit Holders that do not 

wish to commit in advance to a 

minimum number of eligible Trading 

Permits for a calendar year will be 

subject to the standard rate for each 

Market-Maker Trading Permit. Further, 

CBOE shall assess the Fingerprint 

Processing Fee and Inactive Nominee 

Status Fee in the same manner to all 

Trading Permit Holders. For the reasons 

stated in the purpose section, CBOE is 

also proposing to add a VIX Tier 

Appointment and assess a $1,000 

monthly fee to any Floor Broker Trading 

Permit Holder (a) that executes more 

than 20,000 VIX contracts during the 

month and (b) whose aggregate VIX 

executed contracts during the month 

comprise more than 30% of the Floor 

Broker Trading Permit Holder’s 

exchange-wide total executed contracts. 

Accordingly, the Exchange believes that 

the proposed rule change is consistent 

with Section 6(b) of the Act,10 in 

general, and furthers the objectives of 

Section 6(b)(4) of the Act 11 in 

particular, in that it is designed to 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among persons using its facilities for the 

reasons described above. 

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 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 foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 12 and subparagraph (f)(2) of 

Rule 19b–4 13 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–2011–004 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–2011–004. 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 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– 

2011–004 and should be submitted on 

or before February 9, 2011. 

mstockstill on DSKH9S0YB1PROD with NOTICES

3188 Federal Register / Vol. 76, No. 12 / Wednesday, January 19, 2011 / Notices 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Select Symbols refer to the symbols which are 

subject to ISE’s Rebates and Fees for Adding and 

Removing Liquidity in Select Symbols in ISE’s 

Schedule of Fees. 

4See SR–ISE–2010–120. 

5Firm is an order that clears as ‘‘Firm’’ with the 

Options Clearing Corporation (‘‘OCC’’). This fee of 

$0.55 is a fixed routing fee for routing orders for the 

account(s) of Firms. 

6This fee of $0.55 is a fixed routing fee for routing 

orders for the account(s) of Market Makers. The 

Exchange notes that some other options exchanges 

include Market Maker transaction and clearing fees 

as ‘‘broker-dealer’’ fees. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–955 Filed 1–18–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63705; File No. SR– 

NASDAQ–2011–006] 

Self-Regulatory Organizations; 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Routing Fees for the NASDAQ Options 

Market 

January 12, 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 January 6, 

2011, The NASDAQ Stock Market LLC 

(‘‘NASDAQ’’ or ‘‘Exchange’’) filed with 

the Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to modify 

Rule 7050 governing pricing for 

NASDAQ members using the NASDAQ 

Options Market (‘‘NOM’’), NASDAQ’s 

facility for executing and routing 

standardized equity and index options. 

The text of the proposed rule change 

is set forth below. Proposed new text is 

italicized and deleted text is in brackets. 

* * * * * 

7050. NASDAQ Options Market 

The following charges shall apply to 

the use of the order execution and 

routing services of the NASDAQ 

Options Market for all securities. 

(1)—(3) No Change. 

(4) Fees for routing contracts to 

markets other than the NASDAQ 

Options Market shall be assessed as 

provided below. The current fees and a 

historical record of applicable fees shall 

be posted on the NasdaqTrader.com 

Web site. 

Exchange Customer Firm MM Professional 

BATS ............................................................................................................................ $0.36 $0.55 $0.55 $0.36 

BOX ............................................................................................................................. 0.06 0.55 0.55 0.06 

CBOE ........................................................................................................................... 0.06 0.55 0.55 0.26 

CBOE orders greater than 99 contracts in NDX, MNX ETFs, ETNs & HOLDRs ....... 0.24 0.55 0.55 0.26 

ISE ............................................................................................................................... 0.06 0.55 0.55 0.24 

ISE Select Symbols* [of 100 or more contracts] ......................................................... 0.[26]18 0.55 0.55 0.3[1]4 

NYSE Arca Penny Pilot ............................................................................................... 0.50 0.55 0.55 0.50 

NYSE Arca Non Penny Pilot ....................................................................................... 0.06 0.55 0.55 0.06 

NYSE AMEX ................................................................................................................ 0.06 0.55 0.55 0.26 

PHLX (for all options other than PHLX Select Symbols) ............................................ 0.06 0.55 0.55 0.26 

PHLX Select Symbols** ............................................................................................... 0.30 0.55 0.55 0.46 

C2 ................................................................................................................................ 0.21 0.55 0.55 0.46 

* These fees are applicable to orders routed to ISE that are subject to Rebates and Fees for Adding and Removing Liquidity in Select Symbols. See ISE’s Schedule of Fees for the complete list of symbols that are subject to these fees. 

** These fees are applicable to orders routed to PHLX that are subject to Rebates and Fees for Adding and Removing Liquidity in Select Symbols. See PHLX’s Fee Schedule for the complete list of symbols that are subject to these fees. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.nasdaq.cchwall

street.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 

NASDAQ is proposing to modify Rule 

7050 governing the fees assessed for 

options orders entered into NOM but 

routed to and executed on away markets 

(‘‘Routing Fees’’). Specifically, the 

Exchange is proposing to amend its 

current Routing Fees that are currently 

assessed on orders routed to the 

International Securities Exchange LLC 

(‘‘ISE’’) in Select Symbols 3 for orders of 

100 or more contracts. ISE recently 

amended its fees and the amendments 

proposed herein reflect the proposed 

ISE amendments.4

The Exchange proposes to assess 

Customers a fee of $0.18 per contract 

and Professionals a fee of $0.34 per 

contract for orders routed to ISE in 

Select Symbols. The Routing Fees 

currently assessed on Firms and Market 

Makers will remain unchanged. 

Currently, the Exchange assesses the 

following fees to route to ISE in Select 

Symbols of 100 or more contracts: $.26 

per contract for Customers, $0.55 per 

contract for Firms 5 and Market Makers 6

and $0.31 per contract for Professionals. 

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