78792 Federal Register / Vol. 75, No. 241 / Thursday, December 16, 2010 / Notices 

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

10 17 CFR 240.19b–4(f)(2). 11 17 CFR 200.30–3(a)(12). 

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). 

of the benefits to members of direct 

market access. In addition, the Exchange 

believes that its fees are equitably 

allocated among its constituents based 

upon the number of access ports that 

they require to submit orders to the 

Exchange. Furthermore, the fees 

associated with logical and physical 

ports will be equitably allocated to all 

constituents as the fees will be uniform 

in application to all Members and nonmembers. Finally, the Exchange believes 

that the fees obtained will enable it to 

cover its infrastructure costs associated 

with allowing Members and nonmembers to establish logical and 

physical ports to connect to the 

Exchange’s systems and continue to 

maintain and improve its infrastructure, 

market technology, and services. 

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. 

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–EDGA–2010–22 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–EDGA–2010–22. 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 

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–EDGA– 

2010–22 and should be submitted on or 

before January 6, 2011. 

For the Commission, by the Division 

of Trading and Markets, pursuant to 

delegated authority.11

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–31626 Filed 12–15–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63525; File No. SR–CBOE– 

2010–104] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to Professional 

and Voluntary Professional Fees 

December 10, 2010. 

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 December 

2, 2010, 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, II and III 

below, which Items have been prepared 

by CBOE. 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 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 is proposing to amend 

its Fees Schedule as it relates to fees for 

certain orders. 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. 


srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 75, No. 241 / Thursday, December 16, 2010 / Notices 78793 

5The ‘‘Hybrid Trading System’’ refers to the 

Exchange’s trading platform that allows MarketMakers to submit electronic quotes in their 

appointed classes. The ‘‘Hybrid 3.0 Platform’’ is an 

electronic trading platform on the Hybrid Trading 

System that allows one or more quoters to submit 

electronic quotes, which represent the aggregate 

Market-Maker quoting interest in the series for the 

trading crowd. See Rule 1.1(aaa). 

6The term ‘‘Professional’’ means any person or 

entity that (i) is not a broker or dealer in securities, 

and (ii) places more than 390 orders in listed 

options per day on average during a calendar month 

for its own beneficial account. A Professional will 

be treated in the same manner as a broker or dealer 

in securities for purposes of various CBOE Rules. 

The term ‘‘Voluntary Professional’’ means any 

person or entity that is not a broker or dealer in 

securities that elects, in writing, to be treated in the 

same manner as a broker or dealer in securities for 

purposes of various CBOE Rules. The Professional 

and Voluntary Professional designations are not 

available in Hybrid 3.0 classes. See CBOE Rules 

1.1(fff) and (ggg). 

7 Id. 

8See Securities Exchange Act Release No. 63186 

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

(SR–CBOE–2010–095). 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(4). 

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

12 17 CFR 240.19b–4(f)(2). 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of this rule change is to 

adopt fees for Professional and 

Voluntary Professional transactions in 

S&P 500 Index option series (‘‘SPX’’) that 

trade on the Hybrid Trading System. 

The fees, which are described in more 

detail below, will be effective December 

2, 2010. 

By way of background, the Exchange 

currently operates the Hybrid Trading 

System and the Hybrid 3.0 Platform.5

For the Hybrid Trading System, the 

Exchange has Professional and 

Voluntary Professional designations for 

non-broker-dealer customer orders.6

However, these two designations are not 

available for non-broker-dealer customer 

orders in option classes trading on the 

Hybrid 3.0 Platform (which currently is 

only SPX).7 Also by way of background, 

the particular trading platform on which 

index options trade is designated by the 

Exchange on a class-by-class basis 

pursuant to Rule 8.14, Index Hybrid 

Trading System Classes: Market-Maker 

Participants. However, CBOE recently 

amended Rule 8.14 to provide that, for 

each Hybrid 3.0 class, the Exchange may 

determine to authorize a group of series 

of the class for trading on the Hybrid 

Trading System.8

Currently, all series of the SPX option 

class trade on the Hybrid 3.0 Platform. 

Therefore, at this time there are no 

Professional or Voluntary Professional 

designations for SPX. Pursuant to Rule 

8.14, as amended, however, the 

Exchange may determine to designate a 

group of series in the SPX index option 

class for trading on the Hybrid Trading 

System. As a result, the Professional and 

Voluntary Professional designations 

would be applicable to any such SPX 

series trading on the Hybrid Trading 

System. 

In anticipation of the Exchange 

designating a group of SPX series for 

trading on the Hybrid Trading System, 

the Exchange is proposing to adopt fees 

for Professional and Voluntary 

Professional transactions in SPX that 

trade on the Hybrid Trading System. 

The Exchange proposes to charge such 

Professional and Voluntary Professional 

orders in the same manner that it 

charges broker-dealer orders. 

Specifically, the Exchange is proposing 

to amend the text of its Fees Schedule 

to assess a fee of $0.40 per contract for 

Professional and Voluntary Professional 

transactions in SPX option series that 

trade on the Hybrid Trading System. 

The Exchange notes that, in accordance 

with footnote 14 of its Fees Schedule, 

the index option surcharge fee would 

also apply to Professional and Voluntary 

Professional transactions in such SPX 

series. The Exchange also notes that the 

Options Regulatory Fee (‘‘ORF’’) 

contained in section 12 of the Fees 

Schedule will apply to Professional and 

Voluntary Professional transactions in 

such SPX series. In addition, the 

Exchange notes that Professional and 

Voluntary Professional orders in such 

SPX series will not be subject to the 

order handling system order 

cancellation fee contained in section 14 

of the Fees Schedule. No changes to the 

text are needed to reflect the 

applicability of these surcharge, ORF 

and cancellation fee provisions. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the Act,9

in general, and furthers the objectives of 

Section 6(b)(4) of the Act,10 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. 

The proposed fee changes would 

provide clarity on how the Exchange 

intends to implement the Professional 

and Voluntary Professional designation 

for SPX series trading the Hybrid 

Trading System. 

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 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) of the Act 11 and 

subparagraph (f)(2) of Rule 19b–4 12

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–2010–104 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–2010–104. 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 


srobinson on DSKHWCL6B1PROD with NOTICES
78794 Federal Register / Vol. 75, No. 241 / Thursday, December 16, 2010 / Notices 

13The text of the proposed rule change is 

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

www.cboe.org/Legal, on the Commission’s Web site 

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

Commission’s Public Reference Room. 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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 Direct Sessions will consist on one port at the 

Exchange’s primary data center and one port at the 

Exchange’s secondary data center. 

5The ECN translator allows a Member or nonmember who previously connected to Direct Edge’s 

ECN to be re-directed automatically to EDGX 

Exchange, Inc. It can only be accessed through a 

FIX port. 

6See, e.g., Rule 7015 of The NASDAQ Stock 

Market LLC (‘‘NASDAQ’’) (setting forth, among 

other fees for access services, port fees charged to 

members and non-members used to enter orders 

into NASDAQ trading systems). See also Securities 

Exchange Act Release Nos. 60546 (August 20, 

2009), 74 FR 43184 (August 26, 2009) (SR– 

NASDAQ–2009–058) (increasing the monthly fee 

for each port used to enter orders in NASDAQ 

trading systems from $400 per month to $500 per 

month); 59337 (February 2, 2009), 74 FR 6441 

(February 9, 2009) (SR–BX–2009–004) (establishing 

fees for ports used by members to enter orders). See 

Securities Exchange Act Release No. 60586 (August 

28, 2009), 74 FR 46256 (September 8, 2009) (SR– 

BATS–2009–026) (establishing fees for ports used 

by members and non-members to enter orders). 

submission,13 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 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–2010–104 and 

should be submitted on or before 

January 6, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–31634 Filed 12–15–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63520; File No. SR–EDGX– 

2010–21] 

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 

December 10, 2010. 

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 December 

3, 2010, the EDGX Exchange, Inc. (the 

‘‘Exchange’’ or the ‘‘EDGX’’) 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 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 amend its 

fee schedule applicable to Members 3

and non-members of the Exchange 

pursuant to EDGX Rule 15.1(a) and (c). 

Pursuant to the proposed rule change, 

the Exchange will commence charging 

fees for Members and non-members for 

certain logical ports used to enter orders 

into the Exchange’s systems. The 

Exchange also proposes to amend its 

fees for physical ports. 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 

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 

The purpose of the proposed rule 

change is to begin charging a monthly 

fee for logical ports used to enter orders 

in the Exchange’s trading system. The 

Exchange recently began charging for 

‘‘physical’’ ports, which are ports that 

are used by a Member or non-member 

to literally plug into the Exchange at the 

data centers where the Exchange’s 

servers are located (i.e., either a crossconnection or an external 

telecommunication circuit). By contrast, 

a ‘‘logical’’ port (also commonly referred 

to as a TCP/IP port) represents a port 

established by the Exchange within the 

Exchange’s system for trading and 

billing purposes. Each logical port 

established is specific to a Member or 

non-member and grants that Member or 

non-member the ability to operate a 

specific application, such as FIX or High 

Performance API for order entry, or to 

receive market data. Multiple logical 

ports can be created and exist over a 

single physical port. The Exchange 

proposes to charge $500 per month for 

any logical ports other than ports used 

to receive or request retransmission of 

market data. Thus, this proposed charge 

will apply to all Exchange FIX, High 

Performance API, and DROP ports for 

both accessing the Exchange directly 

(Direct) 4 or through the ECN 

Translator.5 Members and non-members 

will receive the first ten (10) sessions 

free of charge for Direct Sessions only 

and thereafter be charged the $500 fee 

per month. Free sessions will not apply 

to ECN Translator sessions to incent 

members and non-members to use 

Direct Sessions. 

Based on the proposal, the change 

applies to Members that obtain ports for 

direct access to the Exchange and nonmember service bureaus that act as 

conduit for orders entered by Exchange 

Members that are their customers. The 

Exchange believes that the imposition of 

logical port fees will help the Exchange 

to continue to maintain and improve its 

infrastructure, while also encouraging 

Exchange customers to request and 

enable only the ports that are necessary 

for their operations related to the 

Exchange. 

The Exchange notes that other market 

centers provide similar services to their 

Members and non-members.6

Physical Ports 

The Exchange currently charges 

Members and non-members the 

following annual fees for physical ports 

based on the connectivity service type: 


srobinson on DSKHWCL6B1PROD with NOTICES