[Federal Register Volume 74, Number 166 (Friday, August 28, 2009)]
[Notices]
[Pages 44412-44414]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-20784]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60547; File No. SR-Phlx-2009-70]


Self-Regulatory Organizations; NASDAQ OMX PHLX, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Eliminate 
Late Charges and Provide for Suspension or Termination for Failure To 
Pay Dues, Fees, or Assessments Owed

August 20, 2009.
    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 August 12, 2009, NASDAQ OMX PHLX, Inc. (``Phlx'' or ``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 the Exchange. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASDAQ OMX PHLX, Inc., pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act'') \3\ and Rule 19b-4 
thereunder,\4\ proposes to amend Exchange By-Law 14-1 to eliminate the 
reference to late charges for failure to pay any fees, dues or charges 
owed to the Exchange. The Exchange also proposes to amend Exchange By-
Law 14-5 to dispose of the foreign currency options participation of a 
member, member organization, participant or participant organization if 
monies due

[[Page 44413]]

and owed are not paid within 90 days. Additionally, the Exchange 
proposes to amend Exchange Rule 50 to eliminate the assessment of late 
charges for dues, fees and other charges not made to the Exchange as 
required and provide for suspension or termination of membership of any 
member or member organization or any person associating with any member 
that fails to pay, after written notice, any required dues, fees or 
other charges or fails to submit a required report or information 
related to the required dues, fees or other charges. The Exchange also 
proposes to amend Exchange Rule 960.6 to extend the requirement that 
the respondents may file a written reply to a summary decision within 
21 days instead of 15 days.
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    \3\ 15 U.S.C. 78s(b)(1).
    \4\ 17 CFR 240.19b-4.
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    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaqomxphlx.cchwallstreet.com/NASDAQOMXPHLX/Filings/.

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
    Generally the Exchange proposes to amend its rules relating to the 
failure to pay dues, fees and other charges to harmonize the Exchange 
rules with Equity Rule 9553 of The NASDAQ Stock Market LLC 
(``NASDAQ''). To effectuate the proposal, a series of minor amendments 
are introduced. More specifically, the Exchange proposes to amend 
Exchange By-Law 14-1 to eliminate the reference to late charges for 
failure to pay any fees, dues or charges owed to the Exchange. The 
Exchange is proposing to no longer charge a late charge for the failure 
to pay any fees, dues or charges owed to the Exchange.
    The Exchange also proposes to amend Exchange By-Law 14-5 to change 
the length of time allowed to dispose the foreign currency options 
participation of a member, member organization, participant or 
participant organization if monies due and owing are not paid. More 
specifically the proposed amendment will change the termination of a 
foreign currency options participation of a member, member 
organization, participant or participant organization if monies due and 
owing are not paid from within one year to within 90 days to comport 
with more efficient processing of regular membership or participation.
    Additionally, the Exchange proposes to amend Exchange Rule 50 to 
eliminate the assessment of late charges for dues, fees and other 
charges not made to the Exchange as required. Instead, the proposal 
provides for suspension of membership of any member or member 
organization or suspension of any person associating with any member or 
member organization that fails to pay, within 21 days of service of 
written notice of suspension, any required dues, fees or other charges. 
The proposal also provides for termination of membership of any member 
or member organization or termination of any person associating with 
any member or member organization that fails to pay, within 21 days of 
service of written notice of termination, any required dues, fees or 
other charges. Certain Exchange dues, fees or other charges are based 
upon self-reported information.\5\ For this reason, the proposal also 
provides suspension of membership of any member or member organization 
or suspension of any person associating with any member or member 
organization that fails to submit the required report or information 
related to the dues, fees or other charges within 21 days of service of 
written notice of suspension. Similarly, the proposal also provides for 
termination of membership of any member or member organization or 
termination of any person associating with any member or member 
organization that fails to submit any report or information related to 
the dues, fees or other charges within 21 days of service of written 
notice of termination. The proposed changes will result in a more 
efficient systematic process of the collection of fees, dues and other 
charges owed the Exchange and comports with NASDAQ Equity Rule 9553. 
The proposed changes also provide guidance regarding service of notice 
of suspension or termination; contents of the notice; effective date of 
suspension or termination; request for hearing; the failure to request 
a hearing; and a request for termination of the suspension.
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    \5\ For a list of fees, see the NASDAQ OMX PHLX Fee Schedule at 
http://www.nasdaqtrader.com/Micro.aspx?id=phlx, Equity Options 
Customer Fees, NASDAQ OMX PHLX Fee Schedule. Also see NASDAQ OMX 
PHLX Rules 703(e), Due Dates, Fees for Late Filing, and 712, 
Independent Audit.
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    The Exchange also proposes to amend Exchange Rule 960.6 to change 
the requirement that the respondents may file a written reply to a 
summary decision within 21 days of service of written notice instead of 
15. This proposal is similar to the requirements of the NASDAQ Equity 
Rule 9553(f).
2. Statutory Basis
    The Exchange believes that its proposal to amend By-Laws 14-1 and 
14-5 and to eliminate Rule 50 and amend Rule 960.6 is consistent with 
Section 6(b) of the Act \6\ in general, and furthers the objectives of 
Section 6(b)(7) of the Act \7\ in particular in that the proposed 
amendments provide a fair procedure for the disciplining of members and 
persons associated with members and the prohibition or limitation by 
the Exchange of any person with respect to access to services offered 
by the Exchange of a member, member organization, participant or 
participant organization thereof. The Exchange believes that the 
proposal is consistent with these obligations in that the amendments 
provide that members, member organizations, participants, participant 
organizations or persons associated with such may be suspended or 
terminated, after written notice, for the failure to pay dues, fees and 
other charges owed to the Exchange. The Exchange believes that 
eliminating references to charges for the failure to pay fees, dues and 
other charges owed the Exchange and to provide for a systematic process 
to suspend or terminate members or persons associated with members 
provides for a fair and efficient process for handling the collection 
of dues, fees and other charges owed to the Exchange. The Exchange's 
proposal is similar to that of the NASDAQ Stock Market LLC.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(7).
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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.

[[Page 44414]]

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
becomes operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-
4(f)(6) thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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    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

    <bullet> Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an e-mail to <a href="/cdn-cgi/l/email-protection#3240475e571f515d5f5f575c4641724157511c555d44"><span class="__cf_email__" data-cfemail="1d6f687178307e7270707873696e5d6e787e337a726b">[email protected]</span></a>. Please include 
File Number SR-Phlx-2009-70 on the subject line.

Paper Comments

    <bullet> Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-Phlx-2009-70. 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 inspection and 
copying 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 publicly available. All 
submissions should refer to File Number SR-Phlx-2009-70 and should be 
submitted on or before September 18, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-20784 Filed 8-27-09; 8:45 am]
BILLING CODE 8010-01-P


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