Federal Register / Vol. 75, No. 36 / Wednesday, February 24, 2010 / Notices 8421 

25 Id. 

26 15 U.S.C. 78f(b). 

27 15 U.S.C. 78f(b)(4), (b)(5) and (b)(8). 

28 15 U.S.C. 78f(b). 

29 15 U.S.C. 78s(b)(3)(A)(iii). 

30 17 CFR 240.19b–4(f)(3). 

31 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

and Section 6(b)(8) requires CBOE’s 

rules to ‘‘not impose any burden on 

competition not necessary or 

appropriate in furtherance of the 

purposes of’’ the Exchange Act.25 CBOE 

believes that its act of making the 

Payment should not be viewed as 

treating an Eligible CBOE Temporary 

Member differently from a non-Eligible 

CBOE Temporary Member. Rather, 

CBOE believes that its act of making the 

Payment should be viewed as an 

undertaking to give full effect to the 

business decision it made to resolve the 

CBOT Lawsuit. 

2. Statutory Basis 

For the reasons described above, the 

Exchange believes that this proposed 

rule change is not inconsistent with its 

obligations under Section 6(b) of the 

Exchange Act.26 In particular, CBOE 

believes that its act of making the 

Payment does not implicate its 

obligations under Sections 6(b)(4), 

6(b)(5) and 6(b)(8) of the Exchange 

Act,27 or other obligations it has under 

Section 6(b) of the Exchange Act.28

Rather, CBOE believes that its act of 

making the Payment should be viewed 

as an undertaking to give full effect to 

the business decision it made to resolve 

the CBOT Lawsuit. 

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)(iii) of the Act 29 and 

subparagraph (f)(3) of Rule 19b–4 

thereunder.30 At any time within 60 

days of the filing of the proposed rule 

change, the Commission may summarily 

abrogate 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–2010–014 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–2010–014. 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 the filing also 

will be available for inspection and 

copying at the principal office of the 

self-regulatory organization. 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–2010–014 and 

should be submitted on or before March 

17, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–3641 Filed 2–23–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61529; File No. SR–Phlx– 

2010–17] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NASDAQ 

OMX PHLX, Inc. Relating to the 

Options Regulatory Fee 

February 17, 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 February 

4, 2010, NASDAQ OMX PHLX, Inc. 

(‘‘Phlx’’ 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 amend its 

Options Regulatory Fee. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://nasdaqtrader.com/ 

micro.aspx?id=PHLXfilings, at the 

principal office of the Exchange, at the 

Commission’s Public Reference Room, 

and on the Commission’s Web site at 

http://www.sec.gov. 

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 


pwalker on DSK8KYBLC1PROD with NOTICES
8422 Federal Register / Vol. 75, No. 36 / Wednesday, February 24, 2010 / Notices 

3See Securities Exchange Act Release Nos. 60405 

(July 30, 2009), 74 FR 39362 (August 6, 2009) 

(National Market System Plan Relating to Options 

Order Protection and Locked/Crossed Markets). 

4The ORF would apply to all ‘‘C’’ account origin 

code orders executed by a member on the Exchange. 

Exchange rules require each member to record the 

appropriate account origin code on all orders at the 

time of entry in order to allow the Exchange to 

properly prioritize and route orders and assess 

transaction fees pursuant to the rules of the 

Exchange and report resulting transactions to the 

OCC. See Exchange Rule 1063, Responsibilities of 

Floor Brokers, and Options Floor Procedure Advice 

F–4, Orders Executed as Spreads, Straddles, 

Combinations or Synthetics and Other Order Ticket 

Marking Requirements. The Exchange represents 

that it has surveillances in place to verify that 

members mark orders with the correct account 

origin code. 

5For example, non-broker-dealer customers 

generally are not charged transaction fees to trade 

equity options on the Exchange. 

6See Securities and Exchange Act Release No. 

61133 (December 9, 2009), 74 FR 66715 (December 

16, 2009) (SR–Phlx–2009–100). 

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

8 15 U.S.C. 78f(b)(4). 

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

10 17 CFR 240.19b–4(f)(2). 

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 amend the Options 

Regulatory Fee to eliminate the 

minimum one-cent charge per trade. 

The Exchange notes that the total 

monthly charges to be assessed in a 

given month will be rounded to the 

nearest $0.01. The Exchange believes 

that by eliminating the one-cent charge 

per trade this should reduce fees related 

to the ORF for members. 

Currently, the Exchange assesses 

$.0035 per contract to each member for 

all options transactions executed or 

cleared by the member that are cleared 

by The Options Clearing Corporation 

(‘‘OCC’’) in the customer range (i.e., that 

clear in the customer account of the 

member’s clearing firm at OCC), 

excluding P/A Orders as defined in the 

Options Intermarket Linkage Plan 

(‘‘Linkage’’).3 The ORF is imposed upon 

all such transactions executed by a 

member, even if such transactions do 

not take place on the Exchange.4 The 

ORF also includes options transactions 

that are not executed by an Exchange 

member but are ultimately cleared by an 

Exchange member. The Exchange 

charges members $.0035 per contract for 

all options transactions executed or 

cleared by the member that are cleared 

by OCC in the customer range, 

excluding Linkage P/A Orders, 

regardless of the marketplace of 

execution. In the case where one 

member both executes a transaction and 

clears the transaction, the ORF is 

assessed to the member only once on 

the execution. In the case where one 

member executes a transaction and a 

different member clears the transaction, 

the ORF is assessed only to the member 

who executes the transaction and is not 

assessed to the member who clears the 

transaction. In the case where a nonmember executes a transaction and a 

member clears the transaction, the ORF 

is assessed to the member who clears 

the transaction. The ORF is not charged 

for member options transactions 

because members incur the costs of 

owning memberships and through their 

memberships are charged transaction 

fees, dues and other fees that are not 

applicable to non-members.5 The dues 

and fees paid by members go into the 

general funds of the Exchange, a portion 

of which is used to help pay the costs 

of regulation. The ORF is collected 

indirectly from members through their 

clearing firms by OCC on behalf of the 

Exchange. Currently, there is a 

minimum one-cent charge per trade.6

The ORF is designed to recover a 

portion of the costs to the Exchange of 

the supervision and regulation of its 

members, including performing routine 

surveillances, investigations, 

examinations, financial monitoring, and 

policy, rulemaking, interpretive, and 

enforcement activities. The Exchange 

believes that revenue generated from the 

ORF, when combined with all of the 

Exchange’s other regulatory fees, will 

cover a material portion, but not all, of 

the Exchange’s regulatory costs. The 

Exchange monitors the amount of 

revenue collected from the ORF to 

ensure that it, in combination with its 

other regulatory fees and fines, do not 

exceed regulatory costs. If the Exchange 

determines regulatory revenues would 

exceed regulatory costs, the Exchange 

would adjust the ORF by submitting a 

fee change filing to the Commission. 

Presently, the Exchange, in 

monitoring its revenue, has determined 

that regulatory revenues may exceed 

regulatory costs on an annual basis. The 

Exchange is proposing to adjust the ORF 

to ensure that it, in combination with its 

other regulatory fees and fines, does not 

exceed regulatory costs. The Exchange 

will continue to monitor the amount of 

revenue collected from the ORF. 

2. Statutory Basis 

The Exchange believes that its 

proposal to amend its schedule of fees 

is consistent with Section 6(b) of the 

Act7 in general, and furthers the 

objectives of Section 6(b)(4) of the Act8

in particular, in that it is an equitable 

allocation of reasonable fees and other 

charges among Exchange members. The 

Exchange believes that this fee proposal 

is equitable because it eliminates the 

minimum one-cent charge per trade and 

reduces the monthly ORF charge for all 

members. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

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)(ii) of the Act9 and paragraph 

(f)(2) of Rule 19b–410 thereunder. At any 

time within 60 days of the filing of the 

proposed rule change, the Commission 

may summarily abrogate 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–Phlx–2010–17 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–Phlx–2010–17. This file 


pwalker on DSK8KYBLC1PROD with NOTICES
Federal Register / Vol. 75, No. 36 / Wednesday, February 24, 2010 / Notices 8423 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b-4. 

3The Commission notes that Exhibit 5 is not 

attached to this Notice which is being published in 

the Federal Register, however it will be posted on 

the Commission’s Web site. 

4See http://www.directedge.com/SubscriberInfo/ 

FeeSchedule.aspx. 

5 17 CFR 242.610. 

6 15 U.S.C. 78f. 

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

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 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–Phlx– 

2010–17 and should be submitted on or 

before March 17, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–3546 Filed 2–23–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61514; File No. SR–BX– 

2010–013] 

Self-Regulatory Organizations; 

NASDAQ OMX BX, Inc.; Notice of Filing 

of Proposed Rule Change To Modify 

Fees for Members Using the NASDAQ 

OMX BX Equities System 

February 12, 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 January 

29, 2010, NASDAQ OMX BX, Inc. 

(‘‘BX’’) 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 from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

BX is filing a proposed rule change to 

modify pricing for BX members using 

the NASDAQ OMX BX Equities System. 

BX will implement the proposed rule 

change on February 1, 2010. The text of 

the proposed rule change is attached as 

Exhibit 5 3and is available at http:// 

nasdaqomxbx.cchwallstreet.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, BX 

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. BX 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 

BX is proposing to modify its fees to 

execute transactions on the NASDAQ 

OMX BX Equities System. BX is 

modifying its fee structure for securities 

that execute at prices below $1. For 

these securities, BX currently charges 

members accessing liquidity a fee equal 

to 0.1% (10 basis points) of the total 

transaction cost and provides no credit 

to members providing liquidity. Under 

the new fee structure, members 

accessing liquidity will be charged 0.3% 

(30 basis points) of the total transaction 

cost, and members providing liquidity 

will be provided a credit equal to 0.25% 

(25 basis points) of the total transaction 

cost. The change is intended to provide 

a competitive response to another 

trading venue that has adopted a similar 

‘‘maker-taker’’ pricing structure for 

securities priced below $1.4 The 

proposal is consistent with the 

provisions of Rule 610 under Regulation 

NMS5 that govern access fees. 

2. Statutory Basis 

BX believes that the proposed rule 

change is consistent with the provisions 

of Section 6 of the Act,6 in general, and 

with Section 6(b)(4) of the Act,7 in 

particular, in that it provides for the 

equitable allocation of reasonable dues, 

fees and other charges among members 

and issuers and other persons using any 

facility or system which BX operates or 

controls. BX is adapting the ‘‘makertaker’’ pricing model that is prevalent 

across most U.S. transaction venues for 

securities priced at $1 or higher and 

applying it [sic] securities priced below 

$1. This change is a competitive 

response to another trading venue that 

has already introduced this pricing 

model for low-priced securities. The 

change will result in a fee increase for 

firms when they access liquidity in 

these securities and a fee reduction for 

firms when they provide liquidity in 

these stocks. The proposed fee change 

applies uniformly to all BX members. 

The impact of the changes upon the 

net fees paid by a particular market 

participant will depend upon the types 

of stocks that it trades, the order types 

that it uses, and the prices of its quotes 

and orders (i.e., its propensity to add or 

remove liquidity). BX 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. BX 

believes that its fees remain competitive 

with other venues and are reasonable 

and equitably allocated to those 

members on the basis of whether they 

opt to direct orders to BX. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

BX 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. 


pwalker on DSK8KYBLC1PROD with NOTICES